Jean-Claude Lupis and Eric S. Langer, BioPlan Associates05.06.15
Contract manufacturing organizations (CMOs) are pretty much on board with their suppliers’ current disposable, single-use bioprocessing device offerings. But they’re becoming increasingly frustrated with how to efficiently hook them into their current biomanufacturing operations. According to our annual industry study, the 12th Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production1, CMOs are more interested in how to integrate single-use devices with existing biomanufacturing platforms, and other suppliers’ devices, in standardized, easier-to-use ways.
This integration problem is part of what is holding up commercial scale manufacturing using disposables. And because CMOs tend to lead the pack in adoption, their demands for better integration are likely to mirror the overall industry’s over the coming several years.
As part of our annual study, we asked CMOs to identify the single most important biomanufacturing trend or operational area that the industry must focus its efforts on this year. The integration of single-use systems emerged as the top trend among CMO respondents, outranking both manufacturing productivity/efficiency and manufacturing cost reductions. This doesn’t necessarily mean CMOs aren’t concerned with efficiency, but rather that their overall process models are different from in-house single-product manufacturers.
By comparison, when we singled out biotherapeutic developers, we found manufacturing productivity and efficiency topped the list of important trends, followed by downstream processing advances. Single-use implementation trailed in the seventh position, behind the likes of continuous processing and biosimilars/biogenerics.
CMOs place single-use integration ahead of manufacturing efficiency and cost reductions because of how disposable device benefits can be leveraged in a multi-product environment (e.g., increased flexibility, reduced contamination risks, rapid turnaround times, and lower capital investments). Nevertheless, it’s telling that CMOs chose a specific trend—single-use implementation—over broader goals such as efficiency and cost reductions.
Surprisingly, few CMOs tabbed biosimilars and biogenerics as a critical trend this year: these follow-on products are more strategic business decisions. So they tended to rank behind operational trends including downstream processing advances, assay methods development and supply chain regulatory compliance. That’s an interesting result because the CMOs with a more strategic focus are likely to have a significant role in the manufacture of biosimilars. While biologics developers may focus on higher-value products with greater profit margins, CMOs with a focus on efficient manufacturing may be able to ride the biosimilars wave. Today, many CMOs have reported revenue increases of up to 15% owing to biosimilars and bio-betters, especially around process development work.
CMOs Bullish on Single-Use Implementation
CMOs see single-use system integration as a top trend because these applications can improve CMOs performance. Indeed, an impressive 86% of CMOs surveyed for our study described “significant” or “some” improvements in biomanufacturing performance based solely on the use of disposable/single-use devices. The only other area to come close was “better process development”, which improved performance for 82% of CMOs. In fact, nearly a third of CMOs credit single-use devices with “significant” improvements. So it’s not surprising that the implementation and integration of these devices is top of mind for them this year.
On the other hand, almost two-thirds of biotherapeutic developers reported improvements, albeit more modest, from disposable devices. Yet these developers focus more on areas like better control of processes, and better analytical testing. So, while the overall industry has recognized benefits of disposable devices, the CMO business model makes them more attractive; and thus, CMOs are more interested in speeding their implementation and integration.
CMOs have long led the way in evaluating new technologies. This year, CMOs outpaced biotherapeutic developers in adoption of the majority of single use systems identified, with the differences particularly stark for applications such as membrane adsorbers, mixing systems, and pre-assembled tubing sets and rigging kits.
Meanwhile, beyond use of disposable devices and better process development, there were some interesting year-over-year trends to note in terms of CMOs’ performance improvements:
Given the trends, we weren’t surprised to see that CMOs want their suppliers to focus their development efforts on single-use systems. CMOs identified their top 5 new product and service areas they want their suppliers to focus on, and disposables occupy three of the top four positions (See Figure 1).
Biotherapeutic developers, in comparison, showed a similar bent towards single-use devices, though not quite as clearly as CMOs, and in a different ranking order. Their top areas of demand are shown in Figure 2.
Developers’ greater demand for disposable bioreactors in comparison to CMOs may reflect their adoption rates. Bioreactors are one of the only disposable systems shown to have greater penetration rates among developers than CMOs. As such, developers may be more demanding of improvements in this particular area. Interestingly, CMOs’ desire for disposables innovation appears to be on a downward trend from last year. For example:
Still, there are some new technologies that are more in demand this year than last, including analytical assays, cited by 30% of CMO respondents this year as a top-5 area for innovation development efforts, up from 11% last year. Also up were cell line services and validation services.
Budgeting for Innovation
Shifts in spending on new technologies are clear indications of shifts in demand. While most CMOs we surveyed expect some degree of increase in spending on new technologies, the results indicate that respondents are projecting greater increases for operations staff and new capital equipment than they are for new upstream and downstream technologies. Specifically:
Conclusion
Data from our 12th annual survey of the industry confirm that single-use devices continue to have a high impact on the performance of both biomanufacturers and their CMO’s. This is particularly the case for contract manufacturing organizations, who view the implementation and integration of these devices as the single biggest trend the industry needs to focus on this year. This is putting increased pressure on suppliers and innovators for these devices to ensure they are developing devices with better integration and implementation in mind.
As biomanufacturers place greater emphasis on single-use integration, and less on innovation, we expect to see continuing growth in the installed base for these disposable devices. CMOs continue to demonstrate that disposable devices can improve productivity, and the data suggest this experience is migrating to in-house biomanufacturers’ clinical scale operations, as well.
With the increasing focus on integration, standardization may become a bigger topic in the near-term. In past studies, we’ve noted strong demand for single-use standardization, with the majority of industry respondents wanting single-use vendors to work harder to standardize characteristic testing, materials, connector compatibility and components, among others. This chorus is likely to grow louder—certainly among CMOs—as they seek to further integrate available devices into their facilities.
It’s not unexpected to see CMOs earmarking greater budget increases for operations staff training than for new upstream and downstream technologies. Short-term demand for manufacturing services is increasing, and CMOs are staffing up. Moreover, rather than demanding more novel technologies, we note that CMOs are seeking supplier developments that improve the actual in-use experience of disposable systems.
In a sense, this represents a maturation of the single-use equipment industry. The widespread penetration of single-use devices at commercial-scale manufacturing, as opposed to clinical production, remains some years off. But with CMOs leading disposables adoption, their focus on implementation and integration signals that standardization may be the next single-use industry mandate.
References
Jean-Claude “JC” Lupis
BioPlan Associates
Experienced market research and data trends analyst, author and editor. JC is a Columbia University master’s graduate, with background in life sciences, media, and international politics.
Eric S. Langer
BioPlan Associates
Eric S. Langer is president and managing partner at BioPlan Associates, Inc., a biotechnology and life sciences marketing research and publishing firm established in Rockville, MD in 1989. He is editor of numerous studies, including “Biopharmaceutical Technology in China,” “Advances in Large-scale Biopharmaceutical Manufacturing”, and many other industry reports. elanger@bioplanassociates.com 301-921-5979.
This integration problem is part of what is holding up commercial scale manufacturing using disposables. And because CMOs tend to lead the pack in adoption, their demands for better integration are likely to mirror the overall industry’s over the coming several years.
As part of our annual study, we asked CMOs to identify the single most important biomanufacturing trend or operational area that the industry must focus its efforts on this year. The integration of single-use systems emerged as the top trend among CMO respondents, outranking both manufacturing productivity/efficiency and manufacturing cost reductions. This doesn’t necessarily mean CMOs aren’t concerned with efficiency, but rather that their overall process models are different from in-house single-product manufacturers.
By comparison, when we singled out biotherapeutic developers, we found manufacturing productivity and efficiency topped the list of important trends, followed by downstream processing advances. Single-use implementation trailed in the seventh position, behind the likes of continuous processing and biosimilars/biogenerics.
CMOs place single-use integration ahead of manufacturing efficiency and cost reductions because of how disposable device benefits can be leveraged in a multi-product environment (e.g., increased flexibility, reduced contamination risks, rapid turnaround times, and lower capital investments). Nevertheless, it’s telling that CMOs chose a specific trend—single-use implementation—over broader goals such as efficiency and cost reductions.
Surprisingly, few CMOs tabbed biosimilars and biogenerics as a critical trend this year: these follow-on products are more strategic business decisions. So they tended to rank behind operational trends including downstream processing advances, assay methods development and supply chain regulatory compliance. That’s an interesting result because the CMOs with a more strategic focus are likely to have a significant role in the manufacture of biosimilars. While biologics developers may focus on higher-value products with greater profit margins, CMOs with a focus on efficient manufacturing may be able to ride the biosimilars wave. Today, many CMOs have reported revenue increases of up to 15% owing to biosimilars and bio-betters, especially around process development work.
CMOs Bullish on Single-Use Implementation
CMOs see single-use system integration as a top trend because these applications can improve CMOs performance. Indeed, an impressive 86% of CMOs surveyed for our study described “significant” or “some” improvements in biomanufacturing performance based solely on the use of disposable/single-use devices. The only other area to come close was “better process development”, which improved performance for 82% of CMOs. In fact, nearly a third of CMOs credit single-use devices with “significant” improvements. So it’s not surprising that the implementation and integration of these devices is top of mind for them this year.
On the other hand, almost two-thirds of biotherapeutic developers reported improvements, albeit more modest, from disposable devices. Yet these developers focus more on areas like better control of processes, and better analytical testing. So, while the overall industry has recognized benefits of disposable devices, the CMO business model makes them more attractive; and thus, CMOs are more interested in speeding their implementation and integration.
CMOs have long led the way in evaluating new technologies. This year, CMOs outpaced biotherapeutic developers in adoption of the majority of single use systems identified, with the differences particularly stark for applications such as membrane adsorbers, mixing systems, and pre-assembled tubing sets and rigging kits.
Meanwhile, beyond use of disposable devices and better process development, there were some interesting year-over-year trends to note in terms of CMOs’ performance improvements:
- Fewer CMOs reported improvements owing to optimized cell culture processes (55% in 2015 vs. 67% in 2014);
- Fewer saw improvements as a result of better Design of Experiments (DoE) related to process development (50% this year vs. 72% in 2014); but
- More reported performance improvements from automated control of processes (41% vs. 33%).
Given the trends, we weren’t surprised to see that CMOs want their suppliers to focus their development efforts on single-use systems. CMOs identified their top 5 new product and service areas they want their suppliers to focus on, and disposables occupy three of the top four positions (See Figure 1).
Biotherapeutic developers, in comparison, showed a similar bent towards single-use devices, though not quite as clearly as CMOs, and in a different ranking order. Their top areas of demand are shown in Figure 2.
Developers’ greater demand for disposable bioreactors in comparison to CMOs may reflect their adoption rates. Bioreactors are one of the only disposable systems shown to have greater penetration rates among developers than CMOs. As such, developers may be more demanding of improvements in this particular area. Interestingly, CMOs’ desire for disposables innovation appears to be on a downward trend from last year. For example:
- Disposable purification products (48% in 2015,vs 56% in 2014);
- Disposable probes and sensors (39%, vs 67%);
- Disposable bioreactors (22%, vs33%).
Still, there are some new technologies that are more in demand this year than last, including analytical assays, cited by 30% of CMO respondents this year as a top-5 area for innovation development efforts, up from 11% last year. Also up were cell line services and validation services.
Budgeting for Innovation
Shifts in spending on new technologies are clear indications of shifts in demand. While most CMOs we surveyed expect some degree of increase in spending on new technologies, the results indicate that respondents are projecting greater increases for operations staff and new capital equipment than they are for new upstream and downstream technologies. Specifically:
- 52% of CMOs expect a significant increase in spending on new capital equipment;
- 48% plan to increase budgets for hiring new operations staff;
- 35% predict budget increases for operations staff training;
- 30% expect increases in budgets for new technologies to improve upstream production; and
- 22% will increase budgets for new downstream production technologies.
Conclusion
Data from our 12th annual survey of the industry confirm that single-use devices continue to have a high impact on the performance of both biomanufacturers and their CMO’s. This is particularly the case for contract manufacturing organizations, who view the implementation and integration of these devices as the single biggest trend the industry needs to focus on this year. This is putting increased pressure on suppliers and innovators for these devices to ensure they are developing devices with better integration and implementation in mind.
As biomanufacturers place greater emphasis on single-use integration, and less on innovation, we expect to see continuing growth in the installed base for these disposable devices. CMOs continue to demonstrate that disposable devices can improve productivity, and the data suggest this experience is migrating to in-house biomanufacturers’ clinical scale operations, as well.
With the increasing focus on integration, standardization may become a bigger topic in the near-term. In past studies, we’ve noted strong demand for single-use standardization, with the majority of industry respondents wanting single-use vendors to work harder to standardize characteristic testing, materials, connector compatibility and components, among others. This chorus is likely to grow louder—certainly among CMOs—as they seek to further integrate available devices into their facilities.
It’s not unexpected to see CMOs earmarking greater budget increases for operations staff training than for new upstream and downstream technologies. Short-term demand for manufacturing services is increasing, and CMOs are staffing up. Moreover, rather than demanding more novel technologies, we note that CMOs are seeking supplier developments that improve the actual in-use experience of disposable systems.
In a sense, this represents a maturation of the single-use equipment industry. The widespread penetration of single-use devices at commercial-scale manufacturing, as opposed to clinical production, remains some years off. But with CMOs leading disposables adoption, their focus on implementation and integration signals that standardization may be the next single-use industry mandate.
References
- 12th Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production, BioPlan Associates, Inc. Rockville, MD., April 2015, www.bioplanassociates.com/12th
Jean-Claude “JC” Lupis
BioPlan Associates
Experienced market research and data trends analyst, author and editor. JC is a Columbia University master’s graduate, with background in life sciences, media, and international politics.
Eric S. Langer
BioPlan Associates
Eric S. Langer is president and managing partner at BioPlan Associates, Inc., a biotechnology and life sciences marketing research and publishing firm established in Rockville, MD in 1989. He is editor of numerous studies, including “Biopharmaceutical Technology in China,” “Advances in Large-scale Biopharmaceutical Manufacturing”, and many other industry reports. elanger@bioplanassociates.com 301-921-5979.
