Biologic-based drugs are increasingly important in the drug pipelines of pharmaceutical companies. Strong growth is projected for biologic-based drugs, and a crucial issue is whether the outsourcing model for biologic-based drugs will follow a similar path as the model for outsourcing small-molecule development and manufacturing or will new paradigms emerge. That question was addressed at one of the sessions at the CPhI Pre-Connect Conference this week in Madrid.
Although small molecules continue to dominate commercial drugs, biologic-based drugs are becoming increasingly important in the future of the pharmaceutical industry. Biologics are expected to account for about 17% of total global spending on medicines by 2016, according to a recent analysis by the IMS Institute for Healthcare Informatics. In 2011, the global market for biologic-based drugs was estimated at $157 billion and is expected to reach between $200 billion and $210 billion by 2016, according to IMS. Seven of the top ten global medicines by spending will be a biologic within five years, according to IMS.
One question that emerges from these shifting patterns is the role of external manufacturers in the biologic-based supply chain, a topic examined by Ulrich Ruemenapp, head of biotech projects, contract manufacturing, at Bayer Pharma, and Charles Jeffries, head of supply-chain management at SkyePharma.
As in any outsourced relationship, security of supply, product quality, and effective project management are important components of a successful external manufacturing partnership, noted the speakers, but additional complexity may arise in technology transfer for biologic-based drugs and in the supply chain itself as a result of the cold-chain logistics required for biologic-based drugs. Strategic sourcing, also important in small-molecule outsourcing, is also a key consideration for biopharmaceutical/pharmaceutical companies as they decide whether to keep a project in-house or to outsource.
But one area where biologic-based manufacturing may take a different path than small-molecule based-manufacturing resides in emerging biomanufacturing technologies and the resulting greater flexibility in managing biomanufacturing capacity. Jeffries pointed to the use of modular biomanufacturing as way to add capacity on-demand. Modular manufacturing as applied to biomanufacturing is an alternative to the traditional method of estimating product demand and building new, or expanding manufacturing capacity to meet projected demand, an estimation that is not easy given the uncertainty of the drug-development process. Reflective of the growing interest in modular manufacturing is GE Healthcare’s acquisition earlier this year of Xcellerex, a company specializing in turnkey biomanufacturing solutions that include modular and portable production trains based on single-use technologies, advanced process automation, and compact cleanroom architecture. Modular biomanufacturing offers the opportunity for companies to better manage the development and market risks associated with drug development by not adding fixed manufacturing capacity. Modular manufacturing may also provide a way for biopharmaceutical/pharmaceutical companies to more cost-effectively establish a manufacturing presence in local markets where a manufacturing presence may be needed to access a given market.
Given the complexity and cost of biomanufacturing capacity, strategies that offer greater flexibility, reduce fixed costs, and help to mitigate the associated risks of drug development will be important factors in the models for biomanufacturing outsourcing.