Nice Insight


Life Science Leader August 2012 Written By Kate Hammeke Director of Marketing Intelligence Nice Insight	Sterile manufacturing of injectables has been at the forefront of both industry news and drug developers� minds recently for a variety of reasons influenced by capacity. An increase in demand for parenteral drugs driven by growth in biologics R&D has created greater demands for capacity. However, the financial investment needed to establish an aseptic fill finish operation � in addition to the challenges in achieving and maintaining compliance � present a significant barrier to any obvious short-term solution for increased capacity. A higher number of sterile manufacturers and increased scrutiny by the FDA has also amplified capacity issues, as unsuccessful inspections have led to temporary shutdowns in order to address compliance concerns. Outsourcing is the alternative route, but the increase in demand for sterile injectable drugs still presents complexities and costs that must be evaluated when considering whether to in-source or outsource production. Striking a balance between having a comfortable level of control over the process, while still making an economically sound decision for the business, adds to the question of whether to do the work in-house or whether to engage a CMO. Results from Nice Insight�s 2011 and 2012 pharmaceutical and biotechnology outsourcing surveys indicate a five percentage point rise among sponsors who outsource the manufacture of steriles (6% in 2011 vs 11% in 2012). When looking at specific sponsor segments, it becomes clear that Big Pharma is driving this increase, with growth from 7% in 2011 to 14% in 2012, followed by Biotechs, which showed a 3% increase from 7% in 2011 to 10% in 2012. This outsourcing trend suggests a few possibilities � a level of �comfort in control� has been found, the costs and time associated with establishing new sterile facilities have forced a compromise, or a loss of confidence in sponsors� own ability to maintain compliance has encouraged decisions to outsource. Considering that some of the big names to have received 483s come from both the sponsor side and contract manufacturer side of drug development, a combination of factors potentially influence the insourcing vs outsourcing decision. Once a decision has been made to outsource, it is important to gain an understanding of how the CMO ranks with respect to Quality, Reliability, Regulatory Track Record and Productivity�the top four drivers influencing sterile fill-finish outsourcing in order of importance to sponsors. To see if the FDA�s increased vigilance has had any impact on how sponsors rate these manufacturers, we reviewed historical Nice Insight survey data for several of the major players in this sector. Surprisingly, the overall net changes across each driver indicated positives in selecting CMOs, with the largest gains in Reliability. Interestingly, Patheon experienced a 4% drop in customer perception of Quality, but a 6% increase in Productivity perception and a 5% increase in Regulatory perception. DSM demonstrated smaller (2-3%), yet steady improvements in each category, with the exception of a 1% drop in Regulatory perception. The clear standout among the CMOs included was Vetter Pharma, with a 6% increase in perception of Quality, a 7% increase in perception of Reliability, and a 3% increase in Regulatory perception.

	One facet of this capacity conundrum that deserves more attention is the increasing need for good, affordable, GMP-compliant facilities that can provide smaller batch runs for Phase 1 testing of cytotoxic products. At present, many facilities capable of manufacturing sterile injectable drugs were designed for substantial-size runs, using one or more manufacturing lines. When it comes to cytotoxic drugs, which can only be produced on certain types of lines and in certain facilities, the options among manufacturers drop and costs rise. The rumor is that India�s contract manufacturing industry has noticed this anomaly � creating a niche for flexible facilities and modular capacity for cytotoxic injectable production � and intends to use the opportunity to enter the market.


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