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Defining the Contract Pharma Provider Relationship

I read an article at Pharmaceutical Manufacturing earlier this year (Inking the Deal: Mastering the art of lasting outsourcing relationships in the pharmaceutical industry) on the nature of contract pharma relationships with customers, and some of the points really struck home.

The limits of describing the relationship between supplier and sponsor are perhaps best captured in the article by the popular contract manufacturer statement: “it depends.”

It’s a truism: many different factors affect and impact how the relationship will come to be defined.

The VP of Global Business Development for one firm explained it nicely in relation to their CDMO services:

“I think it’s important for our potential customers to keep in mind why they went to a CDMO in the first place. Was it speed or technical advancements or a specific delivery platform, for example. If they keep that in the forefront of their minds, they will find a partner that is a good fit.”

At Neuland, we’ve found similar rationales behind a customer’s driving motivation. It may be that timelines are the key driver. It might be regulatory track record, or experience with a given technology or capability. In some cases, the interpersonal relationship might be a key deciding factor.

And just as those drivers vary with each client, so too does each client’s conception of what the relationship should look like – and how it should function. The Pharmaceutical Manufacturing article stated:

Much has been written about the role of contract manufacturers evolving from an “extra set of hands” to a more high-level, strategic partnership. But is the term “strategic partnership” truly the best way to describe the contract organization/drug manufacturer relationship? Again, the answer is: it depends.

Karen Langhauser, author of the article, goes on to point out that the term ‘strategic partnership’ is widely – and perhaps erroneously – used in the bio/pharma outsourcing industry. This may just be linguistic nuance. Most CMOs, CROs or CDMOs would acknowledge that the relationship isn’t exactly a partnership in traditional terms of shared risk/reward, but rather a partnership in the sense of long-term collaboration to create a successful drug product.

Regardless, the point that effective contract firms adapt to the desires of the sponsor drug company are spot-on, and much of this comes down to culture.

One last point from the article dovetailed nicely with our approach here at Neuland: “Building a good outsourcing relationship is the responsibility of both parties, and the best relationships have these three things in common: communication, flexibility and planning.”

Interested in some of the nuance of contract pharma-drug company relationships? Read the full article here: Inking the deal.


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