Contract Manufacturing After COVID-19: Gil Roth on the challenges and opportunities for CDMOs

The contract manufacturing sector is navigating through turbulent times as Gil Roth, Founder and President of the Pharma & Biopharma Outsourcing Association (PBOA) explains.
Caught between the after-effects of the pandemic, changing legislation, and the still-to-be fully realised promise of groundbreaking new treatments, CDMOs are showing real resilience.

“We saw the CDMO rise up heroically to help with vaccine and therapeutic production. While there was a lot of government support on the build-up side, there's been none on the drop-off". Many contract manufacturers had to scale significantly to cope with the demand but "now that things are receding, they are on their own. That's been a real challenge."
Gil says this has been a disappointing for the industry that achieved so much over the pandemic to rush out successful vaccination programmes as part of 'Operation warp speed'.
"A lot of those lessons seem to be forgotten. People start complaining about budgets, and government support starts to dissipate. "They're still arguing over reauthorizing the long standing pandemic and all hazards preparedness act here in the US." says Gil.

“R&D pipelines have been hurt, both by COVID itself or the lockdown period where a lot of research and clinical trials were disrupted. The global interest rate rises post-COVID has also led to some R&D funding drying up."
"The Inflation Reduction Act (IRA) in the US is meant to permit Medicare to begin negotiating prices on certain drugs. Some drug companies have said this is going to stymie their R&D efforts, so are leaving fields X, Y, and Z, which is also impacting funding."
“The CDMO sector is dependent on things making their way through the innovator side, so the R&D drought becomes the CDMO drought”

Cell and Gene Therapy, an area that is predominantly outsourced to startups - has experienced slower than expected growth due to speed of getting treatments approved.
“They're an incredibly promising set of technologies but building up to accommodate it is going to be tough” says Gil.
“The FDA is still working to build up the regulatory framework for a lot of the cell and gene therapies. They are in the process of hiring reviewers, build up that infrastructure and issuing guidance.Protocols that are still being developed for how to do these sorts of trials. The regulatory framework for them is still evolving.”

Gil explains some of the ways that contract manufacturing can adapting and thrive during these challenging times.
“I think they're they're in position, they're adapting. Capital is still accessible when it comes to making new investments. “
"It's worth remembering that Oral solid dosage drugs are still mighty important. In the US 90% of prescriptions are generic, small molecule drugs. That's a big savings on the US healthcare system and one that we helped contribute to by manufacturing for them.”
The onshoring movement is also creating opportunities for CDMOs based in North America and Europe. “There's more to be done for companies are looking for more supply chain security, but there's also geopolitical considerations that licence holders have and they might be interested in moving manufacturing to particular regions that aren't currently served, that might create opportunities for CDMOs in those sectors in those particular geographic regions."
There is still huge opportunities on the horizon with new treatments. “Nobody was predicting a $50 billion market in diabetes drugs that happen to cause weight loss. "
While it can be a gamble to ramp up capacity at an early stage "treatments like this create gigantic demand for certain types of manufacturing that just wasn't there before."

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