Many companies choose to use an end-to-end contract delivery and manufacturing organization (CDMO) to quicken the creation and production of certain medicines, treatments, and drugs.
Usually, CDMOs offer segmented active pharmaceutical ingredients (APIs) or drug products. Some companies provide APIs and manufacturing solutions where others offer drug-product manufacturing and formulation development.
The end-to-end model has grown in popularity and high profile companies have built end-to-end business models to create, formulate, and manufacture pharmaceuticals. Companies who use this business model, which is also called "one-stop shopping," see a faster turnaround from start to finish and have greater control over the consistency and quality of their products.
CDMO companies, also known as CMO or contract manufacturing organizations, are contract pharmaceutical companies.
In the 1990s, big pharma outsourcing trends gained traction, although most CDMOs were contracted to provide services for early drug development stages rather than end-to-end services.¹
Recently, more high-profile companies partnered with established and reliable end-to-end providers than in the past. The pharma outsourcing trends make the drug development process faster and scientists hope better results are produced through this method.
Historically, the pharmaceutical industry trends leaning towards third-party manufacturing were taken up by small to mid-sized pharmaceutical companies. Outsourced manufacturing helped small companies compete with larger ones that had more sourcing, procurement, and chemistry manufacturing control resources than the little guys.
Pharmaceutical clients intending to outsource drug sourcing, manufacturing, and production to one contract manufacturer often do so for the early stages of drug development. This can act as a trial run so that, if the partnership doesn't seem like it will help implement value-added pricing to the end product, pharma companies can terminate the agreement.²
Drugs and medicine are produced in stages.³ Medications begin in the lab and end on a pharmacist's shelf, but the journey from beginning to end includes milling, mixing active and inactive ingredients, pressing tablets, and more.
To create and market a successful medicine, clinical trials must be conducted, patents obtained, and any supporting innovation explored. On the whole, it takes four to five years from start to finish to create an effective, marketable drug. End-to-end CDMOs make this process quicker, more efficient, and cheaper for the patient who needs the medication.
A CDMO can offer a pharmaceutical client all-in-one services in two different ways: a vertical model or a virtually outsourced model. Both methods of approaching an end-to-end model are profitable and more efficient than outsourcing all drug manufacturing steps to different companies.⁴
In the first approach - the vertically outsourced model - clients tend to be large pharmaceutical companies with global reach and deep pockets. Often, the CDMO and the pharmaceutical company are knowledge-neutral, meaning both entities have a similar level of expertise and knowledge when it comes to API components.
The virtually outsourced model is often used by smaller companies with budgetary constraints and limited access to API and other crucial ingredients. In this scenario, the CDMO will procure API, and anything else needed to create the drug, from a reliable source.
CDMOs working with smaller companies in the virtually outsourced model often have third-party logistical capabilities, giving them a lot of control over the manufacturing process's quality and efficiency. In this case, the CDMO is the guide, and the client, who may not employ a subject-matter expert, relies heavily on the expertise and network of the CDMO.
One major issue with end-to-end CDMOs is that these pharmaceutical contract manufacturers exist within a fractured market that is reconsolidating itself.
Especially for smaller to mid-sized companies, an all-inclusive CDMO provides better communication across the whole process than the pharmaceutical companies could provide on their own. Traditionally, the client, a pharmaceutical company, would have to engage multiple constituents to source, produce, and manufacture a single drug.
With a CDMO, drug production efficiency increases because the client doesn't have to be a conduit of information between two separate companies. The CDMO can transfer the necessary information and resources to wherever they're needed in the production supply line.
A CDMO that provides the full spectrum of services needed to create, produce, and market a drug has a lot more quality control and assurances than if several independent companies made that drug.
In the pharmaceutical industry, the popularity of one-stop drug manufacturing contractors is rising. Smaller companies with limited resources can rely on the guidance, network, and expertise of a CDMO to initiate the procurement of API, clinical trials, patents, and anything else needed. Large companies use an end-to-end CDMO to augment their high level of skills and global reach.
For the consumer, an end-to-end CDMO means a higher quality assurance and sooner access to new, effective drugs. If you're interested in outsourcing your drug manufacturing process to a reliable and knowledgeable company, contact BioStem Life Sciences.
(1) Campbell, Ian B., Simon JF Macdonald, and Panayiotis A. Procopiou. "Medicinal chemistry in drug discovery in big pharma: past, present and future." Drug Discovery Today 23.2 (2018): 219-234.
(2) Piachaud, B. S. "Outsourcing in the pharmaceutical manufacturing process: an examination of the CRO experience." Technovation 22.2 (2002): 81-90.
(3) Ciociola, Arthur A., et al. "How drugs are developed and approved by the FDA: current process and future directions." American Journal of Gastroenterology 109.5 (2014): 620-623.
(4) Doig, Alfred, and S. D. Jones. "From CMO to CDMO: Opportunities for Specializing and Innovation." Bioprocess International. Tuesday, May 17 (2016): 2016.
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