The vision of Life Science Leader is to be an essential business tool for life science executives. Our content is designed to not only inform readers of best practices, but motivate them to implement those best practices in their own businesses.
Issue link: https://lifescienceleadermag.epubxp.com/i/267232
OUTSOURCING INSIGHTS REPORT LIFESCIENCELEADER.COM MARCH 2014 14 Both outsourcing and offshoring have shown their effi cacy in cutting costs for pharma companies when it comes to solid dose manufacturing. K A T E H A M M E K E Director of Marketing Intelligence Nice Insight Trends In Outsourcing Solid Dose Manufacturing In 2014 In 2014, the contract manufacturing market for solid dosage forms is anticipated to be $19.6B, representing 58% of the total CMO market value of $33.7B. While the market value percentage for solid dose has been drifting downward — likely related to the shift towards biologics, which are more expensive to develop and manufacture — the propensity to outsource oral solid dosage forms continues to grow modestly. f the 25 percent of respon- dents who will engage a CMO for commercial scale manu- facturing projects this year, more than half of them will outsource solid dosage form manufacturing, show- ing a 4 percentage point increase over last year (51 percent in 2013 up to 55 percent in 2014). Nice Insight's annual survey results indicated that solid dose manu- facturing will be outsourced with the greatest frequency, followed by inject- ables (50 percent), semi-solids (44 per- cent), then specialty dosage forms (42 percent). In general, respondents report- ed they would outsource finished dosage forms with a greater frequency than API manufacturing (for both large and small molecule APIs). When it comes to outsourcing behav- iors, respondents who will contract solid dose manufacturing in 2014 showed a greater likelihood for considering emerg- ing market providers than the general population, with nearly 9 out of 10 stating they include CMOs in emerging markets on their short lists (87 percent vs. 70 per- cent). Among those who consider emerg- ing markets, 63 percent are already work- ing with a manufacturer in an emerging market, and 25 percent are aware of reli- able CMOs but haven't offshored yet. With that said, CMOs in the U.S. and Canada still receive 23 percent of outsourced solid dose projects. China and Western Europe follow, securing 15 percent of outsourced projects, and India is a close contender with 13 percent of the work. There are still anxieties among 13 per- cent of respondents who outsource solid dose manufacturing when it comes to off- shoring. The most frequently voiced fears include the "quality level is too risky," "regulatory compliance concerns," and "intellectual property concerns." Since respondents who will outsource solid dose manufacturing ranked quality as their top priority driving CMO selection, it makes sense that quality also topped the list of concerns. Similarly, a CMO's regula- tory track record ranked third (after reli- ability), which corresponds to regulatory compliance concerns as an apprehension for offshoring. It is interesting to see IP con- cerns in the top reasons for not consider- ing emerging market providers since this worry corresponds much more strongly to primary manufacturing/API produc- tion than secondary manufacturing of dosage forms. Productivity, afford- ability, and innovation ranked fourth through sixth respectively, and this prioritization of outsourcing drivers among solid dose manufacturers hap- pened to match the ranking of the overall respondent group. By K. Hammeke TRENDS IN OUTSOURCING SOLID DOSE MANUFACTURING IN 2014 0 3 1 4 _ R e p o r t s _ O I . i n d d 1 0314_Reports_OI.indd 1 2 / 1 9 / 2 0 1 4 2 : 0 5 : 5 3 P M 2/19/2014 2:05:53 PM