CDMOs (contract development and manufacturing organisations) and CMOs (contract manufacturing organisations) have been a feature of the life sciences sector for many decades. However, this part of the sector is changing and growing, making externalisation an even more critical element of worldwide pharmaceutical and medical device development and production.
A lot of the change taking place within CDMOs and CMOs concerns the business models and strategies they are increasingly deploying. Traditionally, CDMOs and CMOs focused on capacity, often acquiring manufacturing facilities as the primary method of business growth. Today, however, the focus of CDMOs and CMOs is on offering value-adding services.
Capacity is still important, but the ability to offer hard-to-find expertise, industry-leading knowledge, and advanced technologies are some of the things that are making partnerships with CDMOs and CMOs such an attractive option for pharmaceutical and medical device companies.
An example is the ability to manufacture complex and challenging cell and gene therapies. CDMOs and CMOs with this capability offer so much more than straightforward manufacturing capacity.
How CDMOs and CMOs Work
The partnership arrangements between life sciences sector companies and CDMOs/CMOs vary depending on requirements and objectives. For example, large pharmaceutical and medical device companies often choose to outsource elements of a product development project to a CDMO. They could do this because of internal capacity or capability challenges, i.e., where internal resources are either not available or don’t have the right expertise or skillsets.
Startup companies, on the other hand, commonly choose to outsource entire projects, from product design and development to regulatory support to manufacturing and commercialisation. Choosing this approach means the startup doesn’t have to invest in premises, equipment, people, and technologies.
Common services that CDMOs and CMOs offer include drug development, medical device design, regulatory support, and manufacturing.
The Advantages of Partnering with a CDMO or CMO
In general, outsourcing to a CDMO or CMO can distribute the risks associated with manufacturing, especially in startups where a company doesn’t have prior manufacturing experience.
However, there is an even more important factor specifically related to the life sciences sector – mitigating business and process risks without compromising patient safety, compliance, or manufacturing productivity. One example is the risk of supply chain security, as partnering with a CDMO or CMO can improve the robustness of a product’s supply chain.
Speed to Market
Using a CDMO or CMO can accelerate the process of getting a product to market, especially if the partner has available capacity. Given the high levels of competition in the life sciences sector, faster speed to market timescales can have a considerable impact on everything from competitiveness to viability to profitability.
Access to One-Stop-Shop Providers
CDMOs often promote their offering as a one-stop-shop solution, covering all the stages of getting a product from the concept stage to scale-up manufacturing – and even beyond to ongoing product development and end-of-life processes.
These end-to-end capabilities are attractive to many companies in the life sciences sector as it reduces management complexity and can also reduce costs and risks.
Getting access to available capacity is another major benefit of CDMOs and CMOs, whether that is compliance expertise to navigate the regulatory submission process, design and development expertise to develop a viable product, or manufacturing capacity to meet market demand.
As pharmaceutical and medical device products become more advanced with new and innovative technologies, it is becoming increasingly necessary to have access to specialist expertise. That expertise isn’t always available in-house, so partnering with a CDMO or CMO is an attractive solution.
Setting up in-house facilities and capabilities is costly, whether you are employing talent or investing in manufacturing equipment. These costs can be significantly reduced or eliminated by partnering with a CDMO or CMO.
This applies not only at the outset of a contract or project, but also ongoing as it will be the CDMO’s or CMO’s responsibility to ensure manufacturing equipment is upgraded and maintained, as well as to invest in new technologies.
Focus on Core Competencies
Partnering with a CDMO or CMO means your team can focus on your core business functions and competencies, such as R&D, marketing, and sales.
Scalability and Flexibility
Scaling up or down is easier when you partner with a CDMO or CMO. This flexibility ensures you can meet customer requirements when demand is high while minimising costs when demand is low.
Access to Advanced Technologies
Innovative and forward-thinking CDMOs and CMOs invest in the latest equipment and cutting-edge technologies to remain competitive. Partnering with a CDMO or CMO will mean you can also benefit from these investments.
Robust Systems and Infrastructure
CDMOs and CMOs will have robust and long-established procedures that can be immediately deployed on your project. This means you won’t have to spend time and resources developing these systems in-house.
Ultimate Responsibility for Patient Safety and Compliance
There is one final point to highlight before closing. More and more companies in the life sciences sector are partnering with CDMOs and CMOs as they calculate the benefits. However, it is always important to remember that, in the eyes of regulators (and patients), you remain ultimately responsible for product quality, patient safety, and regulatory compliance.
This needs to be considered when deciding to go down the CDMO/CMO route. If you decide this is the best option for your business, make sure you set clear expectations and requirements and ensure there is frequent, timely, and transparent communication. It is also important to continuously measure and monitor the performance of the CDMO/CMO, keeping a record of all monitoring activities in your quality management system.
By taking these steps, partnering with a CDMO or CMO can help companies in the life sciences sector achieve their objectives. As a result, we can expect the trend of growing CDMO/CMO use to continue.