Manufacturing Partnership in Pharmaceuticals – “A No-No or a Win-Win”

Pharma Blog 1

Manufacturing Partnership in Pharmaceutical – “A No-No or a Win-Win”

What does Contract Manufacturing look like in Pharmaceutical?

Contract Manufacturing in Pharmaceutical is the process in which drugs and other supplements are produced on a contract basis (3rdParty Manufacturing).

Many factory productions can be outsourced to contract manufacturers (CMs) in order for businesses to continue offering good quality products to their customers in a cost optimized way  so they can focus on their core competencies such as research, branding, etc.,  increasing their overall productivity and efficiency..

CMO vs CDMO – What’s the difference:

A Contract Manufacturing Organization (CMO) is a company that manufactures a pre-formulated drug, whereas a contract development and manufacturing organization (CDMO) is a company that handles everything from pre-formulation and formulation development to clinical trials and production.

A CDMOs’ through-process reliability can be attractive since all services are completed at one location. But both types of organizations can weave together new drug products into the Pharmaceutical industry with efficiency and accuracy.

When contracting a CMO or CDMO, you will have the peace of mind to get the necessary support with the regulatory aspects. You will have to worry much less about scaling up, establishing GMP compliant processes and having the proper regulatory approvals. CDMOs are highly experienced in creating compliant and effective manufacturing processes, and they will have your back. On the other hand, you get dependent on another company. You have to ensure that everything like intellectual property, quality, costs and data security are covered in your contracts. One thing is for sure- CMOs are essential in the chain of the Pharmaceutical industry and they are here to stay.

Pros and Cons of Contract Manufacturing in Pharmaceutical Industry:

Contract manufacturing organizations can be a great option for Pharmaceutical and biotech companies looking to outsource their manufacturing needs. But as with any business relationship, there are pros and cons to consider before entering into an agreement. Finding the right partner for your product needs and committing to a thorough Due-diligence period will lay the foundation for a promising manufacturing relationship. The partnership between a Pharmaceutical or biotech company and a CMO should feel like a two-way street with both firms working together to ensure quality and compliance.

Pros of Contact Manufacturing:

  • Efficiency: The contract manufacturing companies in India offering their services to the other firms ensure efficiency and optimum usage of resources. Be it manpower or the strategic intelligence or the working resources required in the production cycle. Thus ensuring quality products.
  • No requirement of resources and maintenance: The Pharmaceutical manufacturing companies that avail services of contract manufacturing firms do not require to own maintenance facilities of their own.
  • Quality checks – Bigger Pharmaceutical manufacturing companieshave greater and better layers of quality control in their production cycle. Outsourcing production to bigger companies ensures better compliance of global quality standards.
  • Scalability – Contract manufacturing companies have better resources than any middle or small scale company has. Scaling production is an easy task for them in event of fluctuation in demand and supply.

Cons of Contract Manufacturing:

  • Production time – Research has found that the actual production time is much higher than the estimated production time thus increasing costs for the firm that availed outsourcing.
  • Lesser control of the parent company– The parent company has to relinquish control over the production process once they outsource production to the other firm.
  • No direct communication – There is no direct communication between the people working on the medicine and the parent company since premises of both are different.
  • Leakage of confidential information– There is a possibility of the confidential data of the parent company getting leaked in the process. There is also the risk of misuse or theft of intellectual property that may be exchanged with the other company.

Future developments in Pharmaceutical sector:

1. Improving performance with better AI and electronic Platforms (e-Platforms)

Many CMs are introducing artificial intelligence and other technological innovations to become more cost-effective and speed up production time. Digitizing the services of Pharmaceutical Contract Development and Manufacturing Organizations (CDMOs/CMOs) will ultimately account for greater efficiency in delivering products to target customers.

2. Real-time, remote tracing

In order to monitor the manufacturing process, Pharmaceutical firms conventionally audit or supervise their CM’s production and delivery processes. But, as contract manufacturers innovate their procedures, product conditions can now be checked remotely.

3. Secured channels for supply chains

Despite its apparent benefits, electronic communication may also pose risks to the future of Contract Manufacturing. A patented vaccine formula, for example, can be stolen if the online information of data storage gets hacked or if the formula is sent via unsecured channels. Therefore, serialization laws are already in place to safeguard important data.

4. Introducing Blockchain

Another way in which Contract Manufacturing models are making technological features safer is by introducing blockchain and other cyber security mechanisms. Blockchain in particular is proving to be a significant business asset in the Pharmaceutical industry because of its far-reaching applications, all of which are protected by revolutionary cryptography technology.

5. Specialised services for certain niches

A service that we see considered by CMOs in the Pharmaceutical industry is, developing precision or personalised medicines for small batch productions. Facilitating this is the improving of new equipment that can manufacture small batches of goods quickly.

6. Late-stage customisation

The final development generally we see in Contract Manufacturing for Pharmaceuticals is the late-stage customisation. Late-Stage-Customisation is when the production of a particular good is only pre-assembled. And, it can be processed at any time depending on market demand.

Importance of Partnerships:

The Corona virus crisis has increased the attention of the crucial role of Manufacturing partnerships for Pharmaceutical companies. The number of infectious disease outbreaks projected to keep rising. As Charles Darwin said, “It is the long history of humankind… that those who have learned to collaborate and improve most effectively have prevailed.” In our experience, the Pharmaceutical companies that are winning are those that are able to transform their strategy, produce excellent results from their procurement model, and gain true business value from market partnerships.


Capximize – “To Enable Global Unification Of The Manufacturing Sector”

Capximize India Pvt Ltd, is a global digital Platform for surplus Manufacturing Capacities. The Platform uses its special logic to recommend and connect Indian and Global companies looking for Manufacturing partnerships.

For a Capximizer (Capacity Provider):

  1. Capximize Platform will work as a Marketing Arm for your company. It will give a view of your available surplus Manufacturing Capacities to Domestic and Global corporates.
  2. The Capximize Platform will maintain the data as provided by the Capximizer. Further, it will work towards getting more business for Capximizer.

For a Capximizee (Capacity Seeker):

  1. Capximize Platform will work as a Vendor Development Arm for your company. It gives you options to Pan-India available surplus Manufacturing Capacities
  2. The Capximize Platform will maintain and update the data as provided by Manufacturing Capacity offerings. It works towards offering cost effective Manufacturing Partnerships.

We understand the importance of approaching each work integrally and believe in the power of simple.