GEN Exclusives

More »

Point of View

More »
Aug 1, 2005 (Vol. 25, No. 14)

Taking a Journey-Based Approach to Manufacturing Development

Collaboration on a Rocky Road!

  • Click Image To Enlarge +

    Contract manufacturers are increasingly key players in the development of biotech drugs. However, industry trends are flagging the need for a new business model to serve the CMO/product owner relationship. These trends suggest that the historical, transaction-based business model between biotech product owners and their contract manufacturers is becoming less suitable as the default basis of the relationship.

    In its place, there is an increasing need for a journey-based approach, with a clearer understanding of the relative contributions of the parties, the management of risk, and the desired rewards of each party. I prefer to call this a collaborative approach (see Figure on p.12).

    This should not be confused with the often-trumpeted and over-played partnership between customer and supplier, which really is not appropriate for relationships where there are clear differences in each partys drivers and expectations.

    As with any journey, the travellers need to be clear on their destination, have a good route map, be prepared for inclement weather, and choose their companions wisely! A frequent challenge on journeys in biotech is that the destination can change rapidly and unexpectedly. Clinical trial ambiguity or failure often leads to severe road blocks as a minimum and, more likely, the journeys end.

    Funding problems can often lead to the need to change the route map as companies look for alternative roads to move their product to market. A strong collaboration between CMO and product owner is needed to overcome these challenges.

    The manufacturing journey is generally considered dull and boringa wearying trek through the Badlandsrelative to the fresh air and excitement of scaling the Rockies to secure financing and deliver positive clinical results.

    Consequently, manufacturing development is frequently undervalued and underfunded. It also commands much less attention than it deserves when nonindustry media look at the success stories and challenges in biotech.

    However, recent regulatory trends in both the U.S. and Europe toward improved continuity and a more risk-based approach will demand that the route map of process development be better defined, better recorded, and more effectively implemented.

    Investors are increasingly attuned to these trends and an in-depth assessment of the supply route and the traveling companions is becoming a regular feature of due diligenceeven for early-stage products.

  • Click Image To Enlarge +
  • Critical Success Factors

    Given these trends, the transaction-based business model of the last couple of decades is just no longer fit for purpose. It should not be difficult for traveling companions to co-design and implement a new business model geared to critical success factors other than $ per gram.

    Relationships must start farther upstream, be flexible to development uncertainties and avoid the relationship surprises that always eat time and cost.

    Successful relationships need to look at the relative contribution of each party in adding value to the program. In purely transactional relationships the supplier may never know the value of its contribution and therefore the potential impact of failure to deliver.

    By taking a collaborative approach, the parties can make the best use of each others competencies and deploy appropriate resources to best effect, by agreement. It is important, however, to ensure clarity of the contribution from each side so that the route map is seamless.

    Technical agreements (not to be confused with commercial and quality agreements) are increasingly the norm; addressing relative contributions in the full development journey rather than just focusing purely on elements of QA has become a new way of thinking.

    It is also important to understand and accommodate each others desired goals. These will not be common goals, as might be expected in a partnership, as the business drivers for a CMO are entirely different from those of a product owner.

    Typically, a CMO will desire to work toward long-term commercial supply, whereas the product owner may see (and even conceal) their destination as being some earlier stepping-off point. Lack of clarity on the destination could lead to significant differences of opinion on which route to take.

  • Potential Risks

    By definition, a rocky road is fraught with risk. Identifying the potential risks and contingencies is, therefore, a prerequisite for a successful journey. However, each party must take accountability for risks within their direct control.

    For example, the product owner will not expect to be unduly burdened by product quality and compliance issues; conversely, the CMO must be able to mitigate program delays or stoppages.

    The concept of shared risk, usually assumed in a partnership, is unworkable when the rewards for each party are so different in time and magnitude.

    Finally, inclement weather is forecast! To overcome the inevitable issues, true engagement must occur, requiring sustained interaction and open communication. Those in process development, analysis, and manufacturing must be up-front about process, manufacturing and capacity issues, compliance, and timescales.

    CMOs, in turn, need to be confident that product owners will also be transparent on clinical progress/delay, product need, regulatory feedback, and the financial climate. This approach is essential if the overall program is to respond flexibly to inevitable change, resolve conflicting priorities, and be underpinned by a realistic and living plan.

    The biotech business forecast includes rising demand for smaller quantities of more complex biologics, with CMOs being responsible for a growing percentage of the capacity that delivers these future products.

    This journey promises to be exciting, but not without risks associated with crossing difficult financial terrain. So choose your traveling companions and 4x4 business model wisely.



Jobs

GEN Jobs powered by HireLifeScience.com connects you directly to employers in pharma, biotech, and the life sciences. View 40 to 50 fresh job postings daily or search for employment opportunities including those in R&D, clinical research, QA/QC, biomanufacturing, and regulatory affairs.
 Searching...
More »

GEN Poll

More » Poll Results »

Companion Animal Care

Do you think Americans spend too much on companion animal care?