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A significant milestone in the life of any biotechnology company is deciding how to manufacture your biotherapeutic.
Overall cost will be a crucial consideration, but you also want to ensure speed to market and to build in enough flexibility in case your plans change. Whether you are developing a monoclonal antibody, a vaccine, a cell therapy or a gene therapy, there is an ever-growing number of contract manufacturers (CMOs or CDMOs) that offer a wide range of services and specialisations.
It is tempting to outsource to these organisations, allowing you to focus on the core aspects of running your business, but in-house manufacturing can also bring some advantages. Here, we discuss some of the key factors that could help in making your decision on whether to build or buy.
Evaluate your own situation
Every company has unique circumstances; therefore, the first step toward deciding whether to outsource should be to carefully evaluate — based on your company’s current situation — the future potential of your pipeline, as well as the wider market dynamics.
Emerging single-asset biotechs at the very early stages of the development of their therapy would need to choose a different path compared with those with multiple candidates nearing or already in clinical phases.
Early stage, possibly undercapitalised, biotechnology companies with a sole candidate or a relatively narrow pipeline could benefit from the support of a specialised contract development and manufacturing organisation (CDMO) that offers tailored services for these early years.
At Cytiva, for instance, we have a dedicated FastTrak team who have been supporting early stage companies for more than 17 years. We have already completed a hundred projects with smaller companies that lack the internal resources or in-house expertise to consider manufacturing themselves.
These companies still want to own their processes and expect to be able to transfer these seamlessly in-house at a later stage. Our expert teams help them to plan for the long-term by ensuring that the efficiency and safety standards required for their manufacturing processes are embedded from the very beginning, and by providing full access to the process in action through people-in-plant placements.
More advanced companies should carefully evaluate the potential outcomes for in-house manufacturing against outsourcing. Not just during the next few years, but by planning on a significantly longer timeline to better understand the true costs and potential impacts.
Evaluating the options — outsourcing manufacturing to a CMO or building in-house capacity — requires an overarching assessment of a wide range of factors. With the increasing level of innovation in drug discovery, many companies are looking to manufacture therapies that are built on disruptive approaches or novel technologies, particularly in the cell or gene therapy fields.
It helps to understand how unique or complex the company’s individual processes are before determining how difficult it might be to find a CMO with the appropriate services. Even if the right technologies and expertise can be identified among the potential pool of CMOs, this does not guarantee that capacity is available at the time you need it.
In the case of viral vectors for cell therapies, for example, there is currently a well-recognised shortage of manufacturing capacity globally. In the longer term, another consideration is whether the CMO would be flexible enough to change the volume or capacity to adapt to changes in demand, particularly if limited capacity means that companies must plan and book far in advance.
In terms of the technologies employed in the production of your therapeutic, a key consideration is whether the technology is still advancing at a rapid pace and is only expected to mature at a later stage … or if it is already well established. If this is a fast-evolving technology, it might be better to build in-house capabilities once a more “stable” phase has been reached.
Another aspect when determining if outsourcing is a better option is whether you already have in-house expertise at any level. Even if this is on a small scale, it might be strategically advantageous, particularly if you are operating in a highly competitive part of the market, to build and expand on this within the company.
Finally, one of the most important steps for decision making is the evaluation of the economics of both options. The costs of building in-house capacity versus sourcing capacity externally should be compared for the long term and should consider multiple scenarios based on a variety of success rates for the processes you are developing.
The major in-house costs will include CAPEX, maintenance, utilities, labour and consumable costs. By comparison, when outsourcing, the key costs will be operational, pass-through and tech transfer, as well as consumable costs. In both cases, it is wise to plan for unexpected expenditure during the lifetime of the project.
Why manufacture in-house?
In-house production could bring several advantages. If a manufacturing platform, based on single-use technologies, is installed, then you will have improved manufacturing flexibility and an ability to adapt to sudden changes in demand, either by expanding or reducing capacity as needed.
In addition, this flexibility could enable the preclinical facilities established at your own site to serve as the basis for additional capacity when progressing to the later clinical stages.
With internal manufacturing set up, there is no requirement for tech transfer to the CMO, neither are there licensing fees to be paid and all intellectual property rights remain in-house.
Also, if relevant novel technologies become available that could improve the efficiency, quality or scalability of your manufacturing process, it is potentially easier and faster to integrate these yourself in-house than when working with an external service provider who has to manage the competing demands of a variety of clients and needs.
Given the possibility, in some circumstances, of having to queue for a slot from a CMO, setting up your own manufacturing capacity could end up being a faster option. Modern modular facilities, such as Cytiva’s KUBio, can ensure fast access to market, which is becoming increasingly important with growing patient populations and time pressures.
By contrast, outsourcing has a range of benefits as well. When choosing to work with a CMO, no significant upfront capital investment is needed and expertise can be accessed right away.
Although the lack of certain services or technologies could push companies towards in-house solutions, certain CMOs (or CDMOs) offer an alternative blended option by allowing companies to invest in the required equipment, which would then be housed at the CMO but used for the client’s manufacturing process.
Also, although the waiting time to access services might be significant, the bandwidth and expertise of a contract manufacturer might mean that the delivery times are much more rapid than if you are building, commissioning and then manufacturing in your own facility.
Outsourced manufacturing operations also allow the company to focus solely on core research, which may accelerate the therapeutic through the earlier stages at a possibly faster pace than with in-house-only operations.
Choosing is the hardest thing
There is no one size fits all solution. If you have multiple assets in your pipeline, you may decide to take different approaches in terms of buying and building, ending up with a blended portfolio.
The careful consideration of a wide range of factors that cover future planning, current investment capability and flexibility can help you to evaluate your options and choose the best way forward. Ultimately, you need to put in place capacity that gives you enough flexibility to meet the company’s long-term goals, even when they change with time.
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