Why—and When—to Use a CDMO

Pharmaceutical development companies of all sizes frequently outsource their Active Pharmaceutical Ingredient (API) manufacturing to CDMOs for various reasons, including:

• limited internal know-how and capacity to manufacture API according to Good Manufacturing Practice (GMP), or
• to reduce costs and timelines.

In this article, we will explore three common reasons why a company might consider engaging a CDMO.

Resource optimization

Early clinical development naturally leads to a fast cycling of projects as candidate molecules are identified and prioritized. Providing staff and capital required for this fluctuation in demand is at the discretion of the company. If a company does invest capital and internal resources to expand its manufacturing capability, it’s best to keep those assets active to offset their high cost.

Greater technical expertise and robust infrastructure

Small virtual biotech companies and early-stage clinical companies might have limited internal capabilities and the technical expertise required to manufacture an API. Engaging a CDMO with applicable existing infrastructure and expertise can benefit the company financially while also improving overall product quality and timelines.

Cost reduction

While cost reduction may seem like a guarantee with a CDMO, a company can truly maximize its savings with a well-planned CDMO selection strategy. Initially, a company needs to ensure it’s utilizing its current internal resources to the maximum and only then identify what should be outsourced to a CDMO thus cutting unnecessary spending. More importantly, a carefully planned CDMO selection process can help to identify a CDMO offering the best overall value to the company. While such an identification, evaluation and selection process is not trivial, overall savings can be substantial if the entire process is carried out well.