by Oliver Yu
What CDMOs do is they develop the process for you. And if you choose, they'll also execute the manufacturing process for clinical or cGMP material.
In short, if you're outsourcing either process development or manufacturing, CDMOs are the people you outsource to (pardon the preposition-ending sentence).
Dan Stark, currently senior director in the Global MSAT group at Genentech, once said (paraphrased):
The winners of the age of biotechnology will be the people who can translate research discoveries into commercial product and those who already have the infrastructure will have a head start.What he's saying is if you're just a research outfit and you come up with new molecular entities, you're not in the position to extract the full value of that NME. Say you're IDEC pharmaceuticals and you come up with Rituximab... unless you can get the product into the hands of consumers, you're just a research outfit.
Likewise, if you are a contract manufacturer like Lonza where you have the manufacturing know-how and can produce clinical or commercial material, you also are not in the position to extract the full value of your know-how simply because you rely on someone else for your pipeline. In a lot of ways, you're a commodity (see Samsung getting into the biologics manufacturing space with Samsung Biologics).
Dan is saying that the people... the companies who can take a NME through the clinic... through the FDA approval process and be able to make the drug product are the ones who can extract the full value.
So why would anyone with a NME outsource the crown jewels of their business and go with external process development?
It turns out there are a lot of reasons. To be sure that we got it right, Zymergi has collaborated with Dr. KC Carswell Ph.D of Carswell Bioprocess Consulting to produce a whitepaper on outsourcing process development.
If you're thinking about sending your process development into the hands of a 3rd-party, you definitely need to read the pros and cons of outsourcing.
Get FREE Whitepaper on Outsourcing PD