Specialty drug APIs are both a blessing and a challenge for pharmaceutical companies. They are essential for treating patients and saving lives. The demand for them is high, which promises revenue growth. However, even in the extremely lucrative market of APIs — the API market was valued at around $228.5 billion in 2022 and is expected to expand at a 6.5% CAGR through 2023 — the hurdles around specialty drug APIs remain. The high demand has drawn many companies to invest in these products, but many find they aren’t prepared to properly scale specialty APIs due to the difficulties in the process.

In this article, we explain some of the common challenges that drug companies face when working with specialty drug APIs, as well as some ways to mitigate those challenges with the right contract manufacturing partner.

Challenge 1: Complexity and Diversity

Specialty drug APIs have high complexity and diversity of chemical structures and synthesis routes. Companies must have a team with deep expertise and experience in organic chemistry, analytical chemistry, process development, and scaling to manufacture these products. Even if a company can find the right talent, the synthesis is still complex. Each drug is different and requires a unique, detailed mapping of how process conditions may affect product quality.

One effective approach to tackle this complexity is to outsource development, scale-up, and manufacturing to a contract manufacturer who specializes in these kinds of drugs. Collaborating with an organization such as Neuland, which is equipped with a dedicated state-of-the-art R&D center with around 300 scientists skilled in complex chemistry and process development, ensures your organization has access to the requisite expertise and resources for success.

Challenge 2: Regulatory Requirements

Another challenge facing pharmaceutical companies is the stringent quality and regulatory requirements for specialty drug APIs. These drugs demand rigorous testing, validation, documentation, and compliance with global standards such as USFDA, EMA, PMDA, etc.

The regulatory and quality requirements become even more complex for global companies. Different countries and regions have separate guidelines about the manufacturing of APIs and highly active drugs (for example, Europe’s EMA, China’s CFDA, Mexico’s COFEPRIS, USFDA, Canada’s Health Canada, Brazil’s ANVISA, and India’s CDSCO).

ActaBiomed, a clinical medicine journal, published an article that suggested that the best way to overcome these regulatory challenges is to standardize requirements across countries as well as across drug types. Many regulatory bodies use words like “some” and “certain” when describing which regulations apply to which kinds of chemicals that must be manufactured separately. Harmonization among countries and establishing a common scientific language could significantly increase manufacturing efficiency and ease regulatory confusion.

Until then, how can drug sponsors manage the complexities of global regulatory bodies? One solution is to work with a manufacturer, such as Neuland, with expertise in specialty drug APIs. Manufacturers with this expertise can synthesize, manufacture, and supply APIs and advanced intermediates for specialty drugs, especially those that target rare or orphan diseases. These companies can also offer their customers cost-effective synthesis, IP protection, and regulatory support.

Challenge 3: High Cost and Risk

The high cost and risk of developing and manufacturing specialty drug APIs is another challenge for pharmaceutical companies. These APIs often require significant investments in R&D, infrastructure, and equipment. Even when an organization successfully develops a specialty drug API, there are still many expensive risks, such as:

Environmental concerns
Manufacturing challenges
Supply chain vulnerabilities
Complicated logistics: storage and transportation needs, especially for cold-storage products
Heavy post-market surveillance, as pre-market surveillance is limited and often misses adverse drug events with specialty drug APIs
Risk of injury or illness to personnel handling hazardous materials.

Two recommendations on how pharmaceutical companies can address risk and cost challenges include:

Strategically vetting raw materials suppliers. The higher the quality of the raw materials, the more likely your product will be of high quality, which can avoid cost and time overruns later as well as cut down on environmental waste.
Minimizing the number of partners. The more partners, the greater the likelihood of errors, misunderstandings, and differing standards.

Neuland minimizes risks with our dedicated mini plant for scaling up new products. We also have a process safety lab for evaluating the hazards of chemical reactions. Neuland conducts safety studies to assess the potential risks associated with the manufacturing processes used to produce drug substances and to implement appropriate measures to mitigate these hazards and ensure the safety of workers, the environment, and the final product.

Challenge 4: Fierce Competition

Development of specialty drug APIs is also hampered by the intense competition and innovation in the Specialty Drug API market. The industry requires constant monitoring of the latest trends, technologies, and opportunities for differentiation and value addition.

One contributing factor to the fierce competition is the increasing complexity of novel targeted therapeutics and the lack of in-house manufacturing expertise. According to researchers at Imperial College London, this has led to an increase in mergers and acquisition (M&A) and outsourcing strategies, making it harder for smaller companies and startups to succeed against global corporations with more funding.

Neuland’s core values help our clients succeed in this competitive environment. These values include customer-centricity, reliability, accountability, ownership, openness, and transparency. We also offer a no-compromise policy of not competing with our customers for finished products.