When your company decides to work with a CMO or CDMO on a drug API manufacturing project, the depth of the onboarding process dictates the success of the project. Onboarding is more than just signing a proposal and being introduced to the team. It’s a multi-faceted process that ensures everyone has done their due diligence and considered all of the project’s various components.
How to Set Your Pharmaceutical Contract Manufacturing Project Up for Success.
We are frequently asked what a pharma company working with a contract manufacturer should expect during onboarding. In this initial engagement, your CMO should be focusing on building a strong foundation for systems and processes. At Neuland, we call this the Evaluation and Planning phase. The goal here is to understand the marketing and product requirements. From there, a scientifically sound plan – a project roadmap – is created for project development and delivery.
The entire project initiation/onboarding process should involve representatives from every team involved in the project. You want to make sure all stakeholders are taking ownership and understand their roles.
A Focus on the Science.
The focus of any onboarding process should be on the science. The team will review information from literature or technical packages – including reaction conditions, isolation, characterization, quality and yields. As a part of this, they will also need to evaluate the safety requirements and understand the material balance and reaction mechanism for every step of the project. The more the contract manufacturing team can learn early in the process, the more successful the project will be later.
Concurrent with building this process understanding, the team will be identifying the costs of raw materials, relevant vendors, target timelines, licensing information and other logistics pertinent to the project’s successful execution. For example, at Neuland we’re vigilant about mapping out the manufacturing facility and equipment to ensure we’ve planned accordingly.
Address Potential Obstacles.
It’s no secret that no matter how much planning is involved, a project can still get off-track. A critical part of a solid onboarding process is anticipating and addressing obstacles. A proactive approach that identifies potential chemistry, analytical and practical challenges gives the team an opportunity to develop possible resolutions.
We find that this detailed preparation allows us to develop a systematic work plan which provides our customers with a smooth experience – regardless of what happens. This work plan must be approved by all the internal and external stakeholders involved in the process to ensure they understand the scope of the work and are prepared for execution.
In our experience, a collaborative approach is ideal as it leverages each person’s unique expertise. One way to ensure accountability is to use a responsibility assignment matrix. This is particularly helpful when projects include team members from numerous departments – such as Tech Transfer, Development QA, and Analytical.
A Robust CMO Onboarding Process Leads to Delivering Projects On-Time.
A finalized work plan marks the end of the onboarding process and provides a roadmap for the next steps – the first of which we call Feasibility/Familiarization.
This is where the science begins. Experiments are developed & launched in order to start learning about the process and develop recommendations. If adequate planning has been completed during onboarding, the team can quickly move through this phase and onto Step Two, Optimization.
Step Two is the part of the project where we prepare for – and launch – manufacturing. First, we ensure the process is robust and that we are consistently achieving maximum yield at the appropriate quality levels. We then make any final adjustments to processes and align all stakeholders in preparation for the final phase–manufacturing. With a robust onboarding process, manufacturing should be just as efficient and expeditious as in all the previous steps.
We know our onboarding procedures are rigorous, but we’ve designed them to ensure project success and customer satisfaction throughout the process. We have found that when a comprehensive onboarding process is implemented, the following steps go smoothly and are completed on time.
If your company is considering engaging a contract manufacturing partner, pay close attention to how robust their onboarding process is since it will have a lasting impact during your project.
There’s an eye-popping amount of good news for pharma floating around out there. One report claims a ‘Golden decade of unbelievable innovation’ lies ahead. Others point to COVID19 as the ultimate regulatory process-shortening tool – getting vaccines into arms worldwide in under than year.
And yes – this has been a year in which expectations seem to have shifted broadly. When the world shut down, it was quickly re-opened in new ways, using new technologies and processes.
But how many of these changes will be lasting? It’s a safe bet regulators still won’t go to such calendar-condensing lengths for a new hair growth therapeutic!
At the same time, things are likely to change, aren’t they? After all, we’ve solved some very large challenges and many of the lessons can still be applied when we return to a semblance of normality.
There are many opinions on the subject.
“An analysis of all new drugs developed since 2000 shows that the mean development timeline—from the start of clinical testing (Phase 1) to approval—is nearly ten years. The same holds true for new anti-infective vaccines: the development of vaccines for the human papillomavirus, shingles, and pneumococcal infections, for instance, clocked in at between nine and 13 years. Most academics and pharmaceutical-industry stalwarts would consider a development timeline of less than five years to be highly unusual.”
This is the way things have always been done.
Drugs generally take ten years and X billion dollars to reach market, with some variability over the years. Costs typically rise, and time-to-market holds reasonably steady. It doesn’t change too much.
And then COVID.
McKinsey put together the following graphic demonstrating the difference between ‘then’ and ‘now,’ comparing the compression of the vaccine commercialization timeline with a sample baseline scenario:
But could this be the new path forward, with drug approvals accelerated to the kinds of timelines we’re seeing with the vaccines?
Let’s explore what experts believe will endure and forever change how we operate in the drug discovery, development, commercialization and distribution space.
Regulatory Fast Tracking – the System Worked
Coronavirus vaccine development and distribution demonstrated a functional high-speed ramp up process, made possible due to fast-track regulatory approvals in key geographies and a public-private partnership approach to investment. Speed was the name of the game, especially when it came to investigating the safety and efficacy of countless compounds and treatment protocols.
McKinsey reports that regulators “increased the frequency and intensity of sponsor engagement,” building on the regulatory collaboration model “used by agencies to facilitate alternate pathways in drug and medical-device development over the past decade.”
Examples of such engagement in the past include “the US Food and Drug Administration’s breakthrough therapy designation, fast-track designation program, and the Real-Time Oncology Review pilot. Similarly, the European Medicines Agency created its accelerated-assessment timetable and guidelines, and Japan’s Pharmaceuticals and Medical Devices Agency developed its Sakigake designation program.”
The pandemic’s expedited development will be studied and evaluated, and new programs or processes are likely to emerge that could help accelerate aspects of the approval process.
Unfortunately, according to McKinsey: “Many of the factors that helped compress development timelines for the COVID-19 vaccine were specific to this global pandemic and likely cannot be replicated in all future drug-development programs.
However, McKinsey agrees that there are lessons to be learned from COVID. “There are lessons companies can take from this experience to potentially reduce development timelines by several years, including revamping their design and execution of clinical trials, their approach to risk investment, and their engagement with regulatory agencies.”
Here are two more aspects of drug discovery, development and commercialization which are likely to prevail based on these newer ways of thinking.
Partnering and collaboration have been a dominant business models in the life sciences for decades, and that won’t change. But what has changed in a post-COVID era is the scale and range – as well as the groundswell of projects that have brought competitors together. We are collaborating more and reaching further. The irony isn’t lost on me, as governments and companies work together to improve supply chain resilience by chipping away at the supply chain globalization.
The breadth of collaboration has been stunning. A Wall Street Journal headline captured it perfectly earlier this year in To Make More Covid-19 Vaccines, Rival Drugmakers Team Up. “Sanofi and Novartis are among the big pharmaceutical companies that have agreed to help make a competitor’s shots. Sanofi and GlaxoSmithKline announced a vaccine development partnership in September 2020. More recently, Merck partnered with Johnson & Johnson to manufacture J&J’s one-shot Covid-19 vaccine.”
Collaboration has flourished not only among drug companies, but with the public health sector, academia, governments and NGOs, and more.
The big question is: will we see a longer-term, continuing collaborative trend in the industry? The challenge may be the lens we use to view things post-COVID. The pandemic has dominated news and sucked a lot of oxygen out of the room. For the last 1-1/2 years, it was healthcare. It was bio/pharma, and diagnostics, and food supply chains, and new social rules & practices. Collaboration in the COVID-era was – much like the use of fast track designations – something of a one-off, a perfect convergence of events.
But a newfound sense of collaboration – not just to share and spread risk, but to speed discovery – has taken hold and is likely to reproduce itself at smaller scale in numerous life science silos. Cancer immunotherapy is one such area, as is cell & gene therapy.
Last month, Bioprocess International predicted the Big Pharma collaborative trend would continue beyond COVID. “Manufacturing collaboration between traditional rivals will be normal post-pandemic say GSK and Merck & Co., both of which are using their capacity to support fellow Big Pharma COVID-19 efforts.”
Others have mirrored the same sentiment. From PharmTech, for example: “The rapid and efficient delivery of innovative treatments through the COVID-19 pandemic has demonstrated the value of collaborations within the bio/pharma industry.”
Digital health is one of those areas of drug industry partnership that pre-dated COVID and will continue to expand and play an increasingly important role in healthcare. With what would seem to be prophetic timing, this 2018 article at Xconomy explored how Novartis, Sanofi, AstraZeneca and JNJ were already exploring the nascent field of digital medicine just a few years before it became a global priority.
Digital health is perhaps one area in which it would be difficult to return to the way things were once done.
We’ve added a number of tools to our toolboxes that would be reckless of us to abandon – for patient health, healthcare practitioners and manufacturers.
Five years ago this month, we published a post on emerging analytical R&D trends, discussing key techniques such as Multi-Dimensional Liquid Chromatography, Hyphenated Mass Spectrometric Techniques, Error Analysis, Semi-Micro Methacrylate Monolithic Columns, LC/NMR/MS Integration and Supercritical Fluid Chromatography (SFC). Suffice it to say, 5 years later, most pharmaceutical companies now have many (or all) of these instruments in their labs.
Pharmaceutical sciences have spent the last 2 decades witnessing improvement after exponential improvement – with numerous new techniques and technologies which we now take for granted. This trend has only accelerated over the last five years. We thought it would be a good time to revisit analytical R&D and see what’s on the industry’s radar.
In our annual report, we pointed to digitization as one of the key pillars of agile business practices to future-proof Neuland and ensure our continued success.
As we inch closer to Pharma 4.0, the industry is focused on ‘all things data’ – from the Internet of Things (IoT), to cybersecurity, to analytics, AI and automation. This ‘digitization’ of healthcare will only continue to accelerate as data-driven results lead to faster time-to-market and lower failure rates earlier in development.
Advances in technology are creating exponential improvements. One key aspect of such advances in instrumentation has been better data integration – the ability to share data across instruments and platforms to speed up results, improve decision-making or better address scientific complexity – whether through more sophisticated workflows and capabilities or via improved accuracy and lower limits of detection.
Equipment is also getting smaller. Portability and miniaturization have become a key factor as labs are increasingly packed with more and more equipment.
Key instruments that have become ubiquitous in the pharma analytical R&D lab?
Many of the advances in instrumentation have occurred alongside the adoption of QbD and PAT – both of which stress orthogonal approaches to analysis. All of these common lab instruments are following the model of smaller, more portable equipment designed for rapid analysis.
Most instrument makers are also in some cases ignoring size as a key driver for some equipment, choosing to focus instead on massive increases in capability – whether speed & volume (high throughput) or precision (e.g., lower levels of detection/increased sensitivity). This concurrent development will continue, driving newer and more capable equipment into even rudimentary labs while further extending the capabilities of higher-end equipment.
3. Improvements in Speed & Time
Analytical scientists spend much more of their time prepping experiments, rather than running them or analyzing the results. Ironically, as sample sizes have shrunk, the time spent on sample prep has grown. This should come as no surprise, given the higher value of some APIs and the smaller, more concentrated volumes and complexity of molecules. These added complexities often demand highly specific (and more costly) analytical technologies as well as the expertise necessary to handle the samples.
To address these challenges, technologies are increasingly adapting to the need for faster processing or turnaround times.
4. Ease of Operation
Speed of analysis is important, but another key factor is ease of operation – opening up the opportunity for additional lab personnel to utilize advanced systems. Analytical instruments are increasingly easy to calibrate and operate. In many cases, one-touch operations have reduced the need for instrumentation training and have broadened the number of lab personnel who can perform complex analyses with minimal background in a tool’s operation. This leads to faster results and less operator error – both critical in an age of increasing compound complexity.
These are just a few of the factors influencing the evolution of analytical R&D in modern pharmaceutical labs. As drug development & commercialization becomes increasingly complex, the instruments & methods used to facilitate development will continue to evolve, further transforming the drug industry.
When a drug transitions from early-stage development to late-stage development, the drugmaker has some big decisions to make. Chief among them:
The pandemic made it quite clear that many late-stage life sciences companies are choosing the last option. The contract manufacturing industry experienced a significant jump in 2020, as companies realized that outsourcing manufacturing could help improve the bottom line. As we discussed in our previous post (‘How CMO Expertise Can Solve Key Challenges in Late-Phase Drug API Projects’), when a CMO has the right expertise, they can alleviate bottlenecks in the process – saving valuable time and money.
Many CMOs and CDMOs claim to be experts in late-phase CMS. But what qualities are needed to become a true specialist in contract manufacturing services for late-stage drug development and commercialization?
Here are the top 4 skills your CMO needs to specialize in late-phase CMS:
At Neuland, we do this using a series of data analysis tools and approaches, such as Quality by Design (for lab optimization) and Design of Experiment (for understanding variables). These techniques, along with others, generate data that influences the manufacturing process. This is why it’s so critical that a CMS team be data-driven, and that there is a clear understanding of how to interpret the data.
For example, when we launch a late phase project, we begin by studying data from earlier stages to determine how the products will scale.
Then, as we build out the process, we implement simulations and examine variables, such as solvent volume, temperature, and humidity. We use that data to define operating conditions clearly and to ensure quality, reproducibility and process robustness. With so many potential variables to consider at scale, understanding and being able to effectively use data is a critically important skill.
EHS is an underappreciated core capability of large-scale manufacturers, responsible for avoiding potential risks to our team, to business continuity, and to product capacity. It should always be a priority consideration in late-phase CMS.
We’ve found that our team must be able to bring down the costs –without making cost the focus. In part, this means knowing which lower-cost vendors to use, while also understanding and implementing green chemistry processes to lower cost and waste. Bringing down the cost is also done by paying close attention to yield and waste generation, as well as ensuring reactions are sustainable from an atom economy perspective.
In the case of one Neuland Labs client, a third-party vendor backed out of supplying materials. We created the compound in-house, substantially reducing costs by using our expertise to design a safe, economical process. Our new process increased yield from 30% to 70% while significantly reducing reagent use and waste generation.
These are just a few of the top skills a team needs to specialize in late-phase contract manufacturing services. Of course, communication skills and regulatory experience are vital as well. All of these traits and skills help avoid the risk of lengthening the commercialization process and impacting the patients relying on a drug – risks that few life sciences companies would be willing to take.
To learn more about Neuland’s late-stage capabilities, visit: https://www.neulandlabs.com/capabilities/facilities-overview/
Stating the obvious here, but drug development is a protracted, expensive and risky process. From the lab bench to pharmacy shelves, bringing a new drug to market often stretches 10+ years and costs in excess of $1 billion.
Costs certainly rise as production scales ramp up and compounds enter clinical trials, but much of the drug development work – the honest-to-goodness benchtop scientific research – happens at the earlier discovery & process development stages.
At least, it should.
In many cases, API manufacturers like Neuland are contracted at later stages when companies are ready to scale-up compounds. Late-phase development, which generally refers to the period of Phase II clinical studies and beyond, tends to involve much greater regulatory scrutiny. Challenges with later stages often arise when the early-stage benchwork was limited in scope and focused on creating a viable process rather than the most efficient – and scalable – process.
Perfecting Processes for Scale
Earlier this month, we published a post on route scouting INSERT LINK WHEN LIVE – a key practice for optimizing and scaling a process. It’s a timely topic, given that the bulk of late phase CMS work aims to develop practical, scalable and sustainable drug manufacturing processes which minimize environmental, health and safety liabilities by selecting the right method of synthesis.
Early & Late Phase Development – Delivery Versus Data
Early phase drug development is driven by delivery, whereas later phase work (notably Phase 2 and beyond) is guided by data. In the early phases, the focus is on ‘delivery on time in quality’ – even if this means using a tedious, inefficient, or labor-intensive technology. The precedence is that the product meets the requirement of that particular phase, which is typically a one-time small-scale delivery rather than recurring deliveries in larger quantities.
[In fairness to earlier stage development efforts, it should be noted that ‘driven by delivery’ is not exempt from process R&D. A good amount of work is performed in the earlier stages, but late phase programs tend to embrace more tools and assess more process options during optimization.]
As products continue through clinical trials with increasingly larger patient populations, delivery dates take on secondary importance and data becomes the key driver of additional development work. However, this does not mean that time is no longer a factor. Clinical materials still must be delivered for late phase programs. But at this stage strong emphasis is placed on ensuring the robustness of the manufacturing process – regardless of the scale of operation. The idea is to develop a process that consistently generates the same quality of product, whether it is the first batch or the hundredth batch.
Improving COGS During Late-Phase Development
During late-phase development, the overarching objective shifts to identifying a process which lowers cost of goods while delivering consistency in quality and yield.
What are some of the measures pharma companies (or their manufacturing partners) can take to lower COGS during late-phase development?
The Late-Phase CMS Toolkit
Regulatory authorities worldwide, driven largely by the U.S. FDA and its European counterpart, are making increasing demands in the interest of patient safety. Pharma companies and organizations in the health sector must apply more complete and complex techniques – mainly for process validation but also for the monitoring and the evaluation of the performance of production processes (traditionally called SPC – Statistical Process Control).
As projects progress through scale-up and into later stage clinical trials, there are a range of tools used to ensure an optimized, safe, reproducible process is in place. Approaches such as Quality by Design and Design of Experiment alongside data analysis tools are used to ascertain that all impurities are well below the thresholds of risk to human health, and that the drug manufacturing process is performing as intended.
These and other techniques generate quantifiable data using precise engineering controls and analytical checks. During late-phase development, the data generated can include an understanding of the design space of operations during manufacturing through QbD and DoE, the identification of Normal Operating Range (NOR), Proven Acceptable Ranges (PAR) and Critical Quality Attributes (CQA), and an understanding of impurity profiles and their limits to meet the specifications.
There are also greater regulatory demands for the use of statistical procedures for method or measurement validation, notably to check for measurement imprecision and bias. To meet these demands, it is good practice to follow these three ‘critical checks.’
Quality by Design (QbD)
Using the risk-based Quality by Design approach, late-phase pharmaceutical projects should focus on building a comprehensive understanding of both the end product and process used to deliver it. QbD allows companies to fully understand any potential risks, and control strategies to mitigate those risks. The QbD approach is typically applied during the lab optimization stage at Neuland, after feasibility lab work has been concluded.
Design of Experiment (DoE)
Design of Experiment focuses on selecting independent, dependent, and control variables in order to understand and predict variations in a process. The emphasis is on establishing the validity and reliability of the drug’s chemistry, and ensuring the method is appropriately documented. Along with QbD, DoE helps identify the final optimized ranges in the desired chemistry for both early- and late-phase drug development projects. In the past, DOE studies were typically performed at the request of a client. It has since become a key tool for all large-scale projects – both early- and late-phase.
There are a broad range of data tools used by the pharma industry to characterize, analyze, secure and otherwise ensure the optimal use and storage of relevant process data. In the realm of QbD and DoE, for example, Minitab statistical software is used to increase performance and improve quality & reliability of a process by reducing the uncertainty of measurement systems. The rationale behind statistical analysis software in drug manufacturing is to look at current and past data to discover trends, find and predict patterns and uncover hidden relationships between variables to develop thorough process understanding.
What to Consider in a Late-Phase Manufacturing Partner
What important factors should pharma companies consider when choosing a CMO/partner for late phase development? Here are the top four:
Late-phase CMS projects tend to have a lot of moving parts. Processes must be optimized for production scales, product quality – especially as regards mutagenic and genotoxic impurities – becomes critical, regulatory oversight grows more meticulous, and any delays will likely have a significant bottom-line impact. Selecting a manufacturing partner with a strong reputation in your space and the capabilities to deliver per your project timeline is mission critical.
Demands on a drug’s synthetic processes naturally evolve during its lifecycle. Scouting alternative methods for synthesizing active pharmaceutical ingredients (APIs) early in process development — before they are needed by changing market conditions or other circumstances — offers you many benefits.
What are some of the key benefits of alternate route development?
Very simply, it reduces risks and costs, while providing improvements to your speed, efficiency, and safety. You may achieve:
When developing a new synthetic API route, you should look for a route that:
Naturally, meeting all three of these criteria yields the most benefit, and can often fulfill 80–90% of typical business goals. But even focusing on just one or two of these criteria can provide significant process improvements. For niche products, most companies can expect to reduce cost by 2%–5% through alternate routes. The savings can be much greater in the case of generics, where reductions of 5% or more can potentially be achieved with alternative routes.
To achieve results like those listed above, the following are some of the most effective strategies for success:
In addition to cost, other factors to consider are batch sizes, throughput of the product, lead time and reducing batch cycle. Shortening the route is frequently a goal, as this one change can singlehandedly decrease cost, time, waste, infrastructure and regulatory constraints.
When considering a route change:
The first question to ask is why. By changing the route, what clear benefits can be gained in terms of cost, time and availability?
By guiding your research with these tips, you should be able to identify a synthetic route that meets your expectations and is sustainable across the drug lifecycle.
Here’s some good news, courtesy of DCAT Value Chain Insights:
“Smaller bio/pharmaceutical companies are accounting for an increasingly larger portion of new products as measured by recent new molecular entity approvals.”
The list of companies presented in the article reads like a Who’s Who of company names you might not even know. But they represent a groundswell of change happening in the industry.
Ironically enough, last month we published a post on blockbuster drugs, the lifeblood of Big Pharma (Blockbuster Drugs Hang On: Is a Post-Blockbuster World in Sight Yet?). And while billion-dollar blockbuster drugs are certainly not dead (or going away anytime soon), the constant stream of new small and virtual pharma companies is certainly a sign of a healthy drug industry.
According to the article, “The rise in product innovation from smaller companies comes as R&D productivity from larger bio/pharmaceutical companies declines.” More telling, however, is the data showing that small pharma companies now dominate drug innovation. An article at PharmaVoice also pointed this out last year:
“A report by HBM partners showcases this trend by tracking the NMEs that were originally developed by small, mid-sized, and big pharma companies. In 2009, small pharma was responsible for discovering 31% of NMEs; now jump to 2018, when 64% of all NME approvals originated from small pharma, a 103% increase over 2009.”
That smaller pharma companies have been hotbeds of innovation isn’t a surprise. What is different is the continuing shift in commercialization strategy. Not too long ago, Big (or at least larger) Pharma would be the partner-of-choice to help push a compound over the finish line and onto pharmacy shelves.
The recent data explored in the DCAT article, however, shows that more and more innovator drug developers are choosing to commercialize compounds themselves – albeit typically using a contract manufacturing partner with the requisite chemistry or biologic experience needed to get to scale.
This is a good thing for any number of reasons. From a purely self-motivated perspective, the growth of our Contract Manufacturing Services line of business over the last few years supports this apparent trend. Despite calls around the world clamoring for ‘reshoring’ and ‘onshoring,’ (including here in India), more attention is focused on the realistic supply chain security objectives of backward integration, supplier diversification, or geographical sourcing. For vigilant and proactive bulk suppliers, CMOs and CDMOs, the opportunities seem quite positive.
But more importantly, it is beneficial to the entire industry.
Big Pharma will be able to identify acquisition targets from a larger pool of drug discoverers and developers (though approved drugs will undoubtedly make them costlier targets).
Small and virtual pharma firms – the innovators – will benefit from the presence of similar-stage firms. From collaborative partnerships or innovation hubs to access to capital, innovation begets innovation. Which – in the pharma space – ultimately begets better human health.
Improving human health, of course, is one of the strengths of small and virtual pharma. They are more likely to tackle orphan indications and rare diseases, foregoing their spot at the blockbuster trough to solve some of the overlooked critical health challenges.
Supply chain security has been the subject of numerous posts on this blog in the past. It is important to note, however, that the pandemic hasn’t widely impacted global supply chains, per se. Rather, short-term interruptions intensified scrutiny of an issue that had previously sailed under the radar for much of the pharma industry. In fairness, many have historically viewed supply chain resiliency as a distraction – an additional cost to offset potential negative consequences for bottom lines.
While that viewpoint may endure, most in the industry now consider supply chain security a necessity. In previous posts, we’ve discussed Neuland’s ongoing backward integration efforts, the acquisition and commercial launch of a new manufacturing facility (Unit III), and some of the challenges with current supply chains. In this post, we’ll share some of our supply chain experiences during the pandemic, and look at steps we’re taking (or have taken) to ensure continuity of supply for our API customers.
The Localized Impact of COVID-19 on Supply
While COVID may not have much of a long-lasting impact on global drug supply chains, there have certainly been some bumps in the road. The recent massive case wave in India, for example, impacted operations at numerous companies – including some of our own suppliers.
For example, one manufacturer in Vizag had sudden surge in COVID cases, which threatened our supply. We immediately arranged supplies from our alternate vendor to keep our lines running. The manufacturer recovered within 15 days and has recommenced supplies, but it highlights the importance of having alternate suppliers available and ready to fill any gaps.
In another instance, when oxygen supplies dwindled across India as cases rose, a manufacturer of liquid nitrogen converted all of their transport capacity into liquid oxygen tankers. Neuland contracted with an alternative Telengana-based supplier to continue running our plants without interruption.
These kinds of supply chain interruptions led us to develop a structured process in which we continuously maintain contact with our supply chain partners. This has been particularly useful in conversations with our KSM and Intermediate suppliers, allowing us to have transparency and head off supply challenges before they can impact operations.
With other suppliers, we send out mailers and text messages to maintain an open line of communication. These procedures allow us to react quickly if an issue arises.
Focusing on Core Competencies
At Neuland, we continuously monitor the manufacturing steps of our compounds. One aspect we pay particular attention to is whether a particular element of reaction chemistry falls within our core competency. In some cases, this offers the opportunity for us to outsource non-critical steps in a reaction.
Such a step is often taken due to considerations of plant occupancy owing to long reaction cycles and the scalability of certain processes. In many cases, outsourcing non-critical synthesis steps can ensure faster turnaround times, meaning timelier delivery.
Our overriding consideration is to focus on our core competencies and maximize value delivery to our customers. In one recent case, we outsourced 3 synthesis steps of an API to two competent supply chain partners. This meant we were able to reduce the cycle time as well as the cost of the API to our customer.
Looking Six Months into the Future
Neuland follows a robust monthly SOP procedure which gives us six months of visibility into our Manufacturing & Procurement supply chain operations. The process involves a daily morning standup call of all key personnel which reviews:
This working group is fully empowered to make critical, on-the-spot decisions, as needed. When spikes or dips in demand occur during the monthly cycle, issues may be escalated. All key customer products and service levels are covered as a part of this daily review.
Addressing Complex Supply Chain Challenges
Increasingly complex drug compounds have led to complicated supply chain attributes. Cold chain logistics has become top-of-mind in the wake of the mRNA vaccines. But cold chain was already a critical aspect for the drug industry. It has been reported that cold chain logistics accounted for more than 26% of the pharmaceutical industry in 2019 – and it continues to grow due to increasingly complex molecules and the rise of biologics.
Cold chain logistics may have become more necessary, but it also increases the risk of non-conformance in the supply chain. At Neuland, we’ve partnered with two logistics companies who are certified for Good Distribution Practices (GDP) and are considered among the best in the trade. In the past few years, we’ve avoided temperature outages in our commercial cold chain shipments and have had no products fall out of conformance.
In today’s global business environment, it is essential to have a secure supply chain which can provide consistent quality and prompt delivery without interruption. The pandemic has strained some aspects of the supply chain, emphasizing the importance of keeping a watchful eye on every aspect of the process. Where vendor qualification was once a task performed periodically, companies today must be constantly vigilant, paying close attention to their suppliers and ensuring they are ready to pivot instantly to address potential issues.
Ready to learn more about how Neuland can protect your API supply Contact us today.
“Blockbuster” drugs — typically defined as those that generate annual sales of $1 billion or more — have been the lifeblood of Big Pharma company revenues since Smith, Kline and French’s Tagamet became the world’s first blockbuster in 1986.
But other, non-blockbuster therapeutics are on the rise, largely due to simplified or advantageous regulatory pathways and the rise of precision medicine. These include orphan drugs, gene therapy, immune system solutions, oncology therapies, CAR-T, CRISPR-based therapeutics, and others.
With so many emerging alternatives, there’s been much speculation about the pharma industry entering a “post-blockbuster” world. But does the evidence support it? To find out, we took a look at the current state of blockbuster drugs today.
A glance at any major pharma company’s bottom line makes it easy to understand the impact of blockbuster drugs. Simply put: they generate a significant chunk of revenue. While $1 billion in revenue per year is the price of admission to the blockbuster club, they can generate much more — over $100 billion in lifetime sales for some of the biggest winners. Pfizer’s cholesterol-fighting medication Lipitor, for example, had lifetime sales exceeding $150 billion in 2018, and AbbVie’s Humira approached $110 billion in that same year.
Small wonder, then that blockbuster drugs are the cornerstones of many pharma companies’ portfolios. In 2019, for example, just three drugs — Eliquis, Opdivo, and Revlimid — accounted for 63 percent of Bristol Myers Squibb’s annual revenue, according to data reported by Pharma Manufacturing.
That’s one reason why pharma market watchers like InvestorPlace pay close attention to the rise and fall of blockbuster drugs. Since just one big success can send the stock price of a smaller company skyrocketing, investors have an interest in up-and-coming players with the potential to make blockbuster-class breakthroughs.
The flip side, however, is that larger pharma firms need a regular succession of blockbuster drugs to keep prices stable. These new champions are needed to replace formerly-profitable drugs that fall off the “patent cliff” and become fair game for the makers of generics.
Some of the biggest blockbusters on the market today include:
Many other once-profitable drugs face US patent expirations in the near future. One is Lucentis, a macular degeneration drug from Roche which loses patent protection later this year, but is already slipping as a result of competition from Beovu, launched by Novartis in late 2019. This decline comes on the heels of two other big hits for Roche — Avastin and Rituxan — best-sellers that started facing generic competition in 2019.
Despite the disruptions of the COVID-19 pandemic, the pharma industry hasn’t been idle as some of the biggest blockbuster drugs in history enter their twilight years. According to Evaluate Vantage projections reported by DCAT Value Chain Insights, the US Food and Drug Administration is expected to approve at least ten new biologic and small molecule drugs for launch in 2021 that have the potential to hit blockbuster status in the next five years.
Topping the list are Aducanumab, an Alzheimer’s drug from Biogen/Eisai (estimated 2026 sales: $4.8 billion); Argenx’s autoimmune disease biologic Efgartigimod ($2.5 billion); and Mavacamten, a Cardiac myosin inhibitor for cardiomyopathy from Bristol Myers Squibb ($2 billion).
Based on current trends, there’s no sign that major pharma companies see an end to the dominance of blockbuster drugs any time in the near future. Significant investments are being pumped into R&D efforts to develop new drugs with blockbuster potential, as well as legal efforts to extend the protected status of existing winners.
All this activity suggests that blockbuster drugs will continue to be an industry focus for some time — unless one of the up-and-coming treatment modalities suddenly presents a more lucrative business model.
It is difficult to discuss India’s ‘Make in India’ plan without reference to China, and any discussion of India-China relations ultimately leads to a political – rather than economic or scientific – discussion of relations between our two nations.
Setting aside the sometimes-fraught-but-often-beneficial relationship, however, Atmanirbhar Bharat – and more notably the PLI scheme – has the potential to greatly influence the development of India’s expanding pharmaceutical sector.
Atmanirbhar Bharat seeks to realize one of the principal goals of the Father of India, Mahatma Gandhi – namely, a self-reliant India. Just a few years ago (in the golden age of global trade and protracted supply chains), the concept of trade self-reliance would have been interpreted as some form of economic nationalism rather than supply chain security. Post-pandemic, however, ‘economic self-reliance’ looks downright prophetic.
Atmanirbhar Bharat, of course, was not intended to be a wholly protectionist measure, but rather a series of economic development steps to improve India’s competitiveness in the global economy. One of the chief motivations for developing India-centric industries is our growing dependence on China. Consider:
Setting aside the issues of supply disruption, pandemics and cross-border disputes, Indian manufacturers have become dependent on low Chinese prices to maintain competitiveness. This is true of the pharma sector among many others.
“Make in India” – Seeding Innovation
One of the key initiatives established under Atmanirbhar Bharat has been the Output LinkedIn Incentive (PLI) scheme. In the pharma industry, the program aims to create 3 API parks with shared utilities to reduce dependency on the foreign manufacture of 53 APIs.
While Neuland is not a direct beneficiary of the PLI scheme as it is currently structured, there are ensuing benefits to pharma manufacturers like us. In fact, measuring the value of such programs at the individual company level only tells a very localized story of how one company benefits, or how one single community benefits in terms of job and disposable income creation.
When examined more broadly as an industry, the value of such programs and government support is better understood. While the rise of one well-funded or supported company may help strengthen a specific community, the advancement of an entire industrial sector helps strengthen a nation.
India, of course, already has a robust generic drug sector – the largest in the world, and a position it has held for many years. According to Global Business Reports:
“The generic drugs industry continues to strengthen itself as a key pillar of India’s burgeoning economy. As the largest provider of generics in the world, the sector contributes to 40% of the United States’ generic demand with Indian companies receiving 304 Abbreviated New Drug Application approvals from the United States Food and Drug Administration (USFDA) in 2017. Moreover, the industry exports to almost every nation, and has significant footprints in all the highly-regulated developed markets.”
The PLI Spillover Effect
The PLI scheme and other initiatives look to strengthen the generics position, but also target India’s growing innovator drug and biopharmaceutical sectors. The creation of hubs, as intended with the API parks outlined in PLI, attract startups, investors and allied companies, creating centers of excellence.
Hyderabad, where Neuland is based, is an excellent example of this concentration of resources – having earned the title ‘Cyberabad’ in relation to its strong base in the information technology sector. Likewise, it has been labelled India’s Genome Valley given its dominant position in India’s drug industry. What began as public sector undertakings 50+ years ago have since created centers of excellence in these two sectors.
From Generic to NMEs
Over the last 25 years, nearly every year has given us an opportunity to say: “this is an exciting time to be in pharma.” Case in point: even two years ago, it would have been difficult to imagine accelerating discovery and commercialization efforts to where we would treat a pandemic with multiple purpose-built vaccines in less than 12 months.
Aside from the science side of pharma, this excitement has been mirrored on the business side. When India joined the WTO in 1995, combined industry exports were under $600 million per year. Pre-pandemic, exports amounted to more than $20 billion per year, India had become the world’s largest producer of generic drugs and was the world’s 3rd largest producer (by volume) of drugs. In 2018, Indian drug companies accounted for 35-40% of the FDA’s 971 approvals.
This is astounding growth by any measure, and recent government initiatives such as ‘Make in India’ are expected to further strengthen the industry as attention in India expands from generics into NMEs (New Molecular Entities, or ‘innovator’ drugs) and biopharmaceuticals.
Historically, government grants and private equity investment in India has lagged behind other industrial nations. Given the sky-high expense and exceptionally long timeframes typical of drug discovery, development and commercialization, government efforts to stimulate growth in the sector are appropriate and welcome.