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    Features

    Contract Pharma’s 20th Anniversary Retrospective

    A look back a the pharma/biopharma industry and the future of outsourcing.

    Contract Pharma’s 20th Anniversary Retrospective
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    Kristin Brooks, Managing Editor, Contract Pharma10.15.19
    From CAR-T therapies and Artificial Intelligence (AI), to the enactment of the Drug Supply Chain Security Act (DSCSA), the past five years alone have been transformative for the industry. Unimaginable innovation in drug development has led to more complex and increasingly targeted therapies for smaller patient populations, particularly in the orphan disease and emerging cell and gene space, resulting in manufacturing challenges that require technically advanced solutions. Complexities related to formulation and delivery, and manufacturing and cold chain management of highly-potent drug products and biologics, have all led to increased outsourcing across the continuum, from drug discovery and development through to manufacturing and packaging.

    Some of the factors influencing the industry and outsourcing are more drug approvals requiring advanced manufacturing techniques, rigorous quality and regulatory demands requiring extensive data and validation of operations, and continuous manufacturing efforts to modernize drug production and improve operations, as well as overcoming waste and potential drug shortages. 

    To keep pace, contract service providers have had to evolve to accommodate the changing and growing needs of Pharma and Biopharma influenced by the unique and complex development and smaller scale manufacturing that biologics require, as well as increased quality and regulatory requirements.

    Contract Pharma looks at changes in the industry and outsourcing, what it looked like then, how it has evolved, and where it is today. Global contract service providers and industry analysts offer their insights on how business operations have evolved to accommodate changing industry needs and what we can expect for the future of the industry and outsourcing.


    Today’s drugs
    Several key drugs have had a significant impact on the industry in recent years, transforming cancer treatment and paving the way for breakthrough individualized cell and gene therapies. For example, in 2017 Novartis’ Kymriah was the first chimeric antigen receptor T cell (CAR-T) therapy approved by the U.S. FDA. Kymriah is a treatment for B-cell acute lymphoblastic leukemia which uses the body’s own T cells to fight cancer. The manufacture of Kymriah is a 22-day process, in which T cells are purified from the patient’s blood, and those cells are then modified by a virus that inserts a gene into the cells’ genome. The gene encodes a chimeric antigen receptor (CAR) that targets leukemia cells.

    Additionally, immunotherapies have become game changers in the treatment of cancer. Among the most popular of which is Merck’s Keytruda, a programmed death receptor-1 (PD-1)-blocking antibody for the treatment of various cancers—including those with previously poor outcomes, such as melanoma and lung cancer—which leverages the body’s immune system to fight cancer. Keytruda is projected to be the best-selling drug by 2023 with an estimated $22.2 billion in sales by 2025, according to GlobalData.

    Similarly, Bristol-Myers Squbb’s Opdivo, with sales of $7.6 billion in 2018, is a cancer medicine that is used alone or in combination with other medicines that works with your immune system to interfere with the growth and spread of cancer cells in the body.

    Also notable in the viral space in recent years, is Gilead’s Harvoni and follow on Sovaldi, offering a cure for Hepatitis C. At their peak in 2015, sales reached $19.1 billion. With a cure rate hovering at 100%, sales have since fizzled due to several competitor products and a limited patient population.

    Lastly, surpassing the next top selling dug by nearly $10 billion, Abbvie’s Humira, which treats numerous auto-immune diseases, maintains a stronghold. First approved in the U.S. in 2002, the drug now faces competition from several biosimilars. 

    Amidst these lifesaving drugs, is a pipeline of assets waiting to join the ranks, and a technically advanced CDMO industry to take them there. Over the years, pharma and biopharma companies have increasingly relied on contract service providers to help address increased development and manufacturing complexity, and quality and safety requirements that demand skilled and flexible services.  


    Pharma/biopharma industry changes have significantly impacted contract service providers 
    “Vetter has been an active part of the industry for several decades now and during that time we have experienced some strong developments in our industry. The major one that we see is the ever-increasing quality and regulatory requirements of both customers and authorities alike. Pairing state-of-the-art technology with experienced personnel is essential to fulfill these increasing requests.
    “In the past decades, our customer portfolio has also changed and evolved, from primarily large pharma customers to biotechnology and pharmaceutical customers both large and small, often serving them in the supply of global markets.”
    –Oskar Gold, Senior Vice President Key Account Management and Marketing/ Corporate Communications, Vetter Pharma International GmbH

    “We’ve entered what some might call a golden age for pharma and biotech discovery and development. After years of scientific advancement, marked by the discovery of many new molecules, the industry is now poised to deliver therapies at scale, and this is great for patients. What’s particularly exciting for the future of medicine is the accelerated discovery taking place around large molecule therapies, or biologics, which is leading to personalized treatments and precision medicine.

    “The complexity of large molecule discovery and development has created tremendous opportunity for contract development and manufacturing organizations (CDMOs). What they provide is expertise and capacity to help the industry move from bench scale to commercial scale. The demand for new medicines, especially when one considers smaller patient cohorts suffering from rare diseases, has far outpaced capacity, but that’s changing. And CDMOs are an important part of that change, playing critical roles across discovery, manufacturing and the increasingly complex cold chain for biologics.”
    –Michel Lagarde, Executive Vice President, Thermo Fisher Scientific

    “As many large pharma companies have consolidated into even larger pharma companies, their need to reduce costs and drive shareholder value has initiated many changes in the industry. Where large pharma companies once employed hundreds of research scientists to drive new therapy discovery, much of that innovation today comes from partnerships or outright acquisitions of smaller pharma and biotech companies. CDMOs now have a more diverse, less concentrated pool of potential clinical customers to attract and are less reliant on large pharma for new products, yet it has created even more price pressure on their commercial stage portfolio. This has created the need for CDMOs to be more scientifically savvy and technically capable to compete.”
    –Mark Millar, Director and Business Unit Head, API, Alcami

    “Saying the industry has ‘changed’ in the last 20 years is an understatement. The globalization of healthcare, the advent of patient-centered regulatory regimes focused on quality, and the advancement of genetic and biopharmaceutical science, have all had a significant impact on the industry. 

    “For example, pharmaceutical innovation is not just the provenance of large pharmaceutical companies. Today’s pharmaceuticals are being created by a diverse array of companies around the world employing any number of strategic contract service partners including CDMOs and specialist CMOs.

    “According to the FDA, more than half of the novel drugs approved over the last decade came from enterprises with less than 500 employees.1 Regardless of how large or small the company, more and more drug developers are engaging partners and relying on them to take a greater strategic role in the successful development and commercial manufacture of their products. It’s a dynamic that is changing the industry in very fundamental ways.”
    –JoyL Silva, General Manager, Pfizer CentreOne


    Evolution of C(D)MO service offerings and operations 
    “Following the needs and demands of pharma and biotech, CDMOs have also followed the trend of consolidation. As the pharmaceutical industry is increasingly looking to simplify their supply chain, they look more and more to find partners that offer end-to-end or multiple services. This is especially true with biotech and virtual companies. With limited staff and resources at their disposal, having a single supplier handle multiple aspects of their clinical supply chain can be instrumental to their success. This includes providing more than just product as a CDMO, but also services and strategies to help them navigate the CMC portion of their submission.”
    –Mark Millar, Director and Business Unit Head, API, Alcami

    “Technological advancements in formulation development, in manufacturing process, and development of new methods from “old” processes, have helped the CDMO industry evolve. The technologies we now use for development work, were not around 20, even 15 years ago. The advancements are in pace with the changes in biopharma clients’ needs, providing a competitive edge in manufacturing costs as they shift towards fewer chemical processes and more biologics, potent and targeted and orphan drugs, as well.”
    –David Enloe, President & CEO, Ajinomoto Bio-Pharma Services

    “CDMOs have had to evolve and become more flexible, and investments have been made by many of the larger companies to widen service provision and capacity in specific areas where the industry can benefit. This may be in new areas as research grows, such as cell and gene therapy, or increasing access to manufacturing technologies such as spray drying, where historically there was insufficient capacity to meet increasing global demand for a means of overcoming solubility issues.”
    –Elliott Berger, Vice President, Marketing and Strategy, Catalent


    Global market changes
    “We see discovery and manufacturing taking place in more geographies and by smaller and smaller manufacturers. And that’s an important trend given the potential of more hands across science and medicine to serve patients in need. Yes, expansion has created bottlenecks, but those bottlenecks are a signal of future opportunity for the industry, CDMOs and, most important, for patients seeking treatment. The increased availability of next-generation sequencing, mass spectrometry and cryo-electron microscopy and other technologies, once limited to the few, has unleashed discovery on a global scale. Now it’s incumbent on our industry, i.e., CDMOs, to ensure that capacity is never the reason life-saving therapies are slow to reach patients.”
    –Michel Lagarde, Executive Vice President, Thermo Fisher Scientific

    “The decline in “blockbuster” drugs and rise of smaller, niche therapies have been matched by a rise in the number of smaller/virtual companies that now feature more in the development pipeline. This change has seen service models transform from a fee-for-service “contract manufacturing” basis, to a far more collaborative approach. The smaller companies that lack expertise and resources are more reliant on outsourcing, and look to choose a CDMO development partner by its experience with ‘their type of molecule’, technology offerings, intellectual property and access to specialized dose forms, rather than solely capacity or cost.”
    –Elliott Berger, Vice President, Marketing and Strategy, Catalent

    “From a small molecule API and fine chemical manufacturer perspective, the industry has evolved primarily as a result of the actions of big pharmaceutical companies. Initially the blockbuster wave in the 1990s placed huge demands on European manufacturing capacities and led to the birth of the CDMO industry. This eventually subsided following the dearth of new blockbusters reaching the market, and led to increased economic pressures and the rise of outsourcing to low-cost countries such as India and China. Contract manufacturers were all but commoditized and considered “capacity for hire” with reduced emphasis on a company’s experience or expertise. The industry has now come full circle, driven in large part by the quality concerns of low-cost manufacturing, and the new types of molecules in the pipeline requiring advanced capabilities. This has led to a focus on quality and expertise and projects being re-shored back to western CDMOs.”
    –Matthew Moorcroft, Vice President, Marketing & Intelligence, Cambrex


    Major regulatory changes 
    “On the regulatory side, we have seen some major changes over the past 20 years that have not only advanced the industry, but also our regulatory program. Regulatory filings require higher quality, more data and are undergoing more scrutiny, in addition to requiring electronic filing. We have also seen more robust validation requirements (especially for process validation, continuous process validation, computer system validation, and QC method validation), stronger aseptic requirements (better best practices, thorough media simulations, and preference for isolator technology), and increased regulation of combination products, such as prefilled syringes. We continue and expect to see a strong focus on data integrity management and risk management systems, including risk assessments and escalation as the regulatory industry continues to advance practices and governance.”
    –David Enloe, President & CEO, Ajinomoto Bio-Pharma Services

    “Ongoing collaboration with regulators is essential to accelerating drug development. Recently, manufacturers and CDMOs have engaged more openly and actively in discussions about what’s needed to ensure the consistency, efficacy and safety of drugs for patients.
    “In the U.S., the FDA’s breakthrough therapy designation and regenerative medicine advanced therapy (RMAT) programs have accelerated production of much-needed drugs without compromising FDA’s gold standards. Streamlining approvals doesn’t mean the process is less rigorous, however. In fact, it’s more so, and CDMOs are constantly investing to meet and exceed existing standards. CDMOs are now working closely with the FDA, the European Medicines Agency and other regulatory authorities on improving process validation and data sharing, all important steps toward continuous manufacturing, which promises to lower capital costs, reduce ecological footprints, curtail manual handling of products and improve process control. Thermo Fisher is working closely with industry and regulators around the world to prove continuous manufacturing can work efficiently, safely and at scale.”
    –Michel Lagarde, Executive Vice President, Thermo Fisher Scientific

    “Recent guidance on continuous manufacturing and quality by design manufacturing concepts, is prompting innovation and new capital investment to assure quality and lower manufacturing costs. The introduction of more efficient, direct paths for improving medicines has also had a great impact. Recent guidance supporting both the accelerated approval of drugs for small and underserved patient groups, as well as defining clearer more economic paths to improve existing formulations, are just a few more ways regulators will be driving the industry’s best efforts for decades to come.
    “In February of 2019 the FDA published new draft guidelines to address the quality aspects derived from adopting continuous manufacturing of pharmaceuticals. Covering topics related to development, process validation, marketing authorization and routine production, the FDA is advancing continuous production as the “most important tool” pharma can implement to modernize and improve drug manufacturing.

    “According to the FDA, some 20 companies are working with the agency on continuous manufacturing. During this same period an ICH guideline for continuous manufacturing of medicinal products was also initiated and is planned for a 2021 release.”
    –JoyL Silva, General Manager, Pfizer CentreOne

    The future of the industry and outsourcing
    “I would expect improvement and advances in the discovery process starting with rigid scientific and regulatory requirements built into the process—rigor that goes from validation and clinical trials to QA/QC. This will help us get closer to the promise of continuous manufacturing and, most important, we’ll be able to improve the speed and lower the cost of bringing life-saving therapies to patients.”
    –Michel Lagarde, Executive Vice President, Thermo Fisher Scientific

    “A further significant change is taking place. While identifying a positive development in the number of new drug approvals—59 this year vs. 46 in 2018, particularly injectables—the market size for many drug products is getting smaller. Nowadays, a number of medicines being developed are ever-more targeted, and consequently designed for smaller patient groups, representing a greater understanding and knowledge of precision medicine. Also, the business of data and intelligence is receiving a great deal of attention and is a topic that will continue to evolve. This is primarily due to new methods in the area of digital health.”
    –Oskar Gold, Senior Vice President Key Account Management and Marketing/ Corporate Communications, Vetter Pharma International GmbH

    “Drug molecules are becoming increasingly complex, and the challenges of bringing a successful drug to market are increasing while timescales for projects, and patient populations decrease. One specific area where innovators are looking to development partners for guidance is in dose design and thinking earlier on in the development process about decisions that will impact important patient-related factors such as patient adherence and ultimately, outcomes. A drug will only be successful if the active molecule is efficacious, and it is formulated into an optimal dose form that can be taken easily and as prescribed.”
    –Elliott Berger, Vice President, Marketing and Strategy, Catalent

    “Currently pharma is outsourcing the development and manufacture of about 25 percent of all its products.2 A 2018 vision gain report forecasts the overall pharmaceutical contract manufacturing market is growing fast, achieving revenues of $84.0 billion in 2020 at a compound annual growth rate of 6.4 percent over the last five years. The market is expected to keep pace with this growth through 2026 as more pharmaceutical companies strategically outsource their manufacturing.3

    “Contract manufacturing partners are being tasked with making more complex types of products under increasing regulatory, quality and patient requirements—and that’s something that is here to stay.”
    “We’re seeing a patient-centered focus on delivering medicine through a more personalized and targeted way to treat complex disease processes. Advanced, highly potent oral solid dose formulations are on the rise. The use of pre-filled combination devices to deliver advanced therapies like monoclonal antibodies, gene therapies and new classes of personalized medicines are now available.”
    –JoyL Silva, General Manager, Pfizer CentreOne

    References
    1. https://www.pharmacist.com/article/fda-helping-small-businesses-get-big-results
    2. https://resultshealthcare.com/wp-content/uploads/2017/01/Results-Healthcare_Pharma-Biotech-2017-Review-of-outsourced-manufacturing_Whitepaper.pdf
    3. https://www.visiongain.com/market-for-pharmaceutical-contract-manufacturing-will-reach-84-0bn-in-2020-according-to-new-visiongain-data
    Publisher’s Note
    Contract Pharma would like to thank our advertisers, show exhibitors, sponsors, along with our loyal readership and show attendees for their continued support. We hope that Contract Pharma has kept you informed with the many changes in our industry during the past 20 years. My business partner Damaris Kope and I have enjoyed this amazing 20-year run. We’ve seen businesses grow from concept to major industry players along with the many mergers and acquisitions over the years. Through it all, Contract Pharma has adapted and thrived. We started out in 1999 with just the print product and added our conference two years later. Then we added digital services, webinars, and videos to our offerings to address the changing media landscape. Our editors Tim Wright and Kristin Brooks have done an amazing job supplying topical information and news to our readers and conference attendees. I would also like to thank former Editor, Gil Roth (PBOA), for his 15 years of outstanding service. For some this will be a trip down memory lane, and for others newer to the industry, this issue will give you a perspective on how the industry has changed and what the future might hold. I hope you enjoy the Contract Pharma 20th Anniversary Issue.  
    —Gary Durr

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