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REPORT 28 LIFESCIENCELEADER.COM JULY 2014 CMO SUPPLEMENT EXCLUSIVE LIFE SCIENCE FEATURE OUTSOURCING BIOMANUFACTURING CONTINUES TO GROW IN FREQUENCY By K. Hammeke his integration can take sever- al different forms, from part- nerships with large biophar- mas (56 percent), purchase of a small biopharma company (51 percent), partnering with a small biopharma (37 percent), or simply purchasing a biophar- ma's compounds (22 percent). These activ- ities are motivated by the demonstrated profitability of biopharmaceuticals. The practice of partnering with or acquir- ing biopharmaceutical companies is mirrored in the results of Nice Insight's annual survey, where the percentage of respondents whose businesses are engaged in the development of biologic- based therapeutics continues to increase — up two percentage points from 71 percent in 2012 to 73 percent in 2014. Spend on biologics development now consumes a slightly larger portion of these businesses' annual expenditure as well: 57 percent in 2014 as compared to 54 percent in 2012. Such expenditure continues to show promise for contract service providers both in winning out- sourced biomanufacturing projects and in manufacturing biosimilars/bioequiva- lents for the biologics that come off pat- ent in the coming decade. Now is a good time to start considering CMOs for these projects. OVERALL EXCELLENCE IN CUSTOMER PERCEPTION PLAYS A STRONG ROLE IN CMO SELECTION Interest in identifying quality suppliers for biomanufacturing services prompted the expansion of Nice Insight's research to include specific questions about buy- ers' habits when outsourcing mam- malian and microbial manufacturing, as well as their supplier preferences. According to the 2014 study, 53 percent of respondents who will outsource bio- manufacturing would engage a CMO for mammalian cell culture. In reviewing the companies that were most likely to be considered for this type of project, it was clear that overall excellence in cus- tomer perception played a strong role. In fact, these companies averaged excellent ratings (between 80 and 100 percent) from respondents who outsource mam- malian cell culture in four out of five categories. Quality was the single cat- egory where scores fell slightly below the excellent range (by 2 percentage points). The top companies considered for mam- malian cell culture projects were GSK Contract Manufacturing, Boehringer Ingelheim, CMC Biologics, Lonza, and KBI Biopharma. Microbial manufacturing was reported to be outsourced with greater frequency than mammalian cell culture, with near- ly two-thirds of respondents who will outsource biomanufacturing reporting they would outsource microbial manu- facturing (65 percent). Three of the com- panies that were most likely to be con- sidered for mammalian cell culture also made the top five for microbial manu- facturing: GSK Contract Manufacturing, Boehringer Ingelheim, and Lonza. Pfizer CentreSource and Althea rounded out the top five companies most likely to be con- sidered for a microbial manufacturing project. While the highest scores among the top five companies were in reliability and regulatory, these companies aver- aged excellent scores in all five categories. Nice Insight also reviewed the scores from a broader group of CMOs for both mammalian cell culture and microbial manufacturing to see where these com- panies received their highest scores. T K A T E H A M M E K E Contributing Editor Outsourcing Biomanufacturing Continues To Grow In Frequency Nice Insight has learned from its strategic partnering surveys that the long-term strategies of many businesses in the pharmaceutical industry for maintaining a strong drug development pipeline include integration of biopharmaceuticals. 0 7 1 4 _ R e s e a r c h _ R e p o r t s _ O I _ B i o 2 . i n d d 5 0714_Research_Reports_OI_Bio2.indd 5 6 / 2 3 / 2 0 1 4 3 : 1 4 : 2 9 P M 6/23/2014 3:14:29 PM