Current and Future Trends
CMOs are expecting cost savings from innovations, including expanded use of disposable equipment and increased yields from improved expression systems and cell lines. This complements trends among drug innovators, particularly larger ones, which are becoming increasingly risk- and cost-averse.
The biopharmaceuticcal industry is also outsourcing projects at an increasing rate, which contributes to the future prospects for CMOs. Despite this additional business, CMOs continue to be a competitive bunch, as they vie for projects to keep their facilities running. The ongoing credit crunch could end up slowing major expansion projects, forcing both innovator companies and CMOs to implement technological fixes to further increase capacity.
New CMOs continue to enter the market, both in developed and developing countries, with many countries offering lower costs but having limited requisite expertise, facilities, and quality programs to manufacture at FDA/EU cGMP standards. The market for CMOs will continue to expand as dozens of companies enter the biosimilars/biogeneric markets.
BioPlan’s 7th Annual Report & Survey of Biopharmaceutical Manufacturing & Capacity provides new perspectives regarding current and future capacity issues facing CMOs and the broader biopharmaceutical industry. Preliminary data from this year’s study shows continued investments in capacity expansion for manufacture of both clinical- and commercial-scale biologics. With biopharmaceuticals one of the few bright spots for expected growth in pharmaceutical industry sales and profits now and in coming years, investments in biopharmaceuticals development and manufacturing capacity simply make good economic sense.
Recent years have seen significant investments in and expansions by biopharmaceutical CMOs, paralleling capacity expansions by innovator companies. However, while investments in biopharmaceuticals increase, especially in comparison with other pharmaceuticals, most respondents indicated that their companies are also working hard to decrease operational expenses as much as possible.
When CMOs were asked in this year’s study whether they have increased prices for biopharmaceutical manufacturing services, about 75% reported no significant increases. In terms of specific areas where prices were reported to have increased, the largest proportion of responses (20%) reported price increases for clinical supply manufacture. There has been a significant increase in demand in recent years for smaller-scale manufacturing as biologics make it through the pipeline.