Strong growth with increasing competition
Bioanalytical services accounted for the largest share of the global healthcare analytical testing services market in 2015,1 reflecting the rising percentage of largemolecule drugs in the pharma industry pipeline — a trend that is expected to continue for the foreseeable future. On the other hand, the batch-release testing segment is expected to grow more than any other segment during the next five years, according to Markets and Markets.1
North America currently dominates the pharmaceutical analytical testing services market due to the large number of wellestablished service providers and highquality standards, as well as rapid growth in the biosimilars and biologics segments in the region.1 The Asia-Pacific market is growing the fastest, however, due to the cost advantages offered by companies in India and China.1 There are challenges with outsourcing analytical services to the region, particularly with respect to quality and intellectual property. In China, the former is actively being addressed by China’s Food and Drug Administration, which has issued stricter regulations and begun cracking down on noncompliant companies. These aggressive actions are anticipated to drive additional outsourcing to the country in the future.
The strong growth of the pharmaceutical analytical testing services market has attracted many new entrants, leading to steadily increasing competition for wellestablished, standalone service providers. Today, many contract development and manufacturing organizations (CDMOs), both large and small, that have analytical capabilities to support their development and manufacturing activities, now offer analytical services and some expertise as well. Numerous smaller firms specializing in analytical services only have also entered the market and compete on pricing and possibly shorter turnaround times.
Outsourcing allows redirection of resources
As the complexity, not only of new drug substances, but also of drug development, formulation and manufacturing processes, continues to increase, (bio)pharma companies are pressured to make maximum use of project resources. Outsourcing of an ever-wider variety of essential analytical functions that don’t require extensive training, expertise or equipment has therefore become the norm.
Analytical method development, including optimization and transfer, analytical method validation, release testing, stability studies and associated testing (e.g., micro testing) and raw material testing, are all core services required by all pharmaceutical companies and most frequently outsourced. By doing so, they free up resources for redirection to address more challenging research and product development issues and/or complex/proprietary activities related to specific products. Release, stability and raw material testing are the most commoditized analytical functions and offer the greatest opportunities for cost savings.
There are a few exceptions where the need for specialized expertise and equipment is driving outsourcing. Demand for extractable and leachable (E&L) testing has grown in recent years as the adoption of single-use technologies has become much more widespread at the commercial scale. Demand for API and product characterization are also on the rise. Both E&L analyses and characterization studies require expensive instruments (mass spectrometers and nuclear magnetic resonance imaging systems) and most companies cannot justify the expense of purchasing and maintaining such equipment and the experts required to conduct the analyses and interpret the results. Outsourcing of this testing, which often is the last testing required prior to filing of a new drug application (NDA), is growing.
Quality, cost and turnaround times matter
While cost savings was initially the main driver for outsourcing in the pharmaceutical industry, today (bio)pharma companies seek much more than just reduced project expenses. Indeed, according to the 2016 Nice Insight CDMO Outsourcing Survey (n=587), improving quality is the number one goal, followed by reducing time to market, increasing efficiency and reducing cost.2
Manufacturers seeking analytical testing service providers look for quality in terms of technical performance — i.e., the quality of the data and work performed — as well as with respect to regulatory compliance. In particular, the ability of an analytical testing outsourcing partner to recognize out-of-specification (OOS) materials very early on in a project and proactively deal with such issues is crucial; if caught at a late stage, OOS issues can lead to the derailment of projects.
Cost does remain a factor, of course, particularly for more commoditized services. However, most customers do not consider cost as an independent determiner of partner selection. Rather, the cost versus value equation is the decision driver. Most clients are willing to pay a premium if the service provider offers measurable added value.
For analytical services perhaps more so than other outsourcing activities, rapid turnaround times are crucial to client success. The results of analytical testing are required before many key decisions in the drug development process can be made. Consequently, analytical service providers can impact the progress of a program at all stages, including formulationselection manufacturing process decisions and release of clinical trial materials, to name a few.
For smaller and emerging (bio)pharmaceutical companies, the ability to provide regulatory expertise can be a real differentiator when it comes to choosing an analytical testing partner. These firms often require assistance with everything from initial new drug applications and NDA filings to addressing questions raised by the relevant regulatory agencies. Analytical service providers that have a deep understanding of the drug development process and extensive knowledge of regulatory requirements, combined with the ability and willingness to provide customized support, are viewed as offering real added value. These companies also appreciate outsourcing partners — including analytical testing service providers — that offer innovative contract options, including creative risk-sharing, dedicated resources (FTE models) and other financial incentive solutions.
New strategy to leverage discovery and development expertise
As a provider of end-to-end solutions for integrated drug discovery and development, chemistry, DMPK, API synthesis and optimization, formulation development and cGMP manufacture of drug products, BioDuro has extensive analytical testing expertise to support all phases of drug development from discovery to clinical-trial material manufacture. The company is implementing a new strategy to leverage these capabilities to meet the growing demand in the pharmaceutical industry for highquality, rapid analytical testing support with the introduction of standalone analytical services.
With both discovery- and developmentrelated analytical expertise, BioDuro can support clients across the full development cycle, including studies to support discovery and candidate selection; preclinical to clinical activities, including API synthesis, screening and characterization; preformulation and formulation development; and engineering batch and clinical trial material manufacturing efforts. The analytical data drives several critical decisions as one navigates through several CMC drug development processes. Having an expert analytical team equipped with the right know-how and tool box to accelerate scientifically sound decision-making is essential to any program’s success.
By offering standalone services, the company will be able to leverage its analytical expertise to help clients at early stages of their development projects through late-phase clinical trials. One advantage of the analytical arm of a CRO and CDMO like BioDuro is the ability to better understand the physical, chemical and biological properties of the API and drug product as well as the challenges of the formulation and manufacturing process. This inherent expertise will enable the development and optimization of the analytical methods more effectively and efficiently. With this new strategy, Bio- Duro is also removing most of the barriers generally in place with standalone analytical contract organizations that support different phases of drug development.
Often not well-equipped with knowledge of background information on and experience with the API and dosage form process development, a contract analytical testing laboratory can be handicapped when it comes to selecting the best analytical approach to develop methods, or troubleshooting atypical or out-of-specifications analytical data, among other things. The extensive collaboration approach at the company — along with centers of excellence in chemistry, DMPK, solubility and bioavailability enhancement — will facilitate problem resolution, allowing the identification of analytical problems early on in a project before they become significant issues. As a result, the negative impact that analytical challenges can have on the overall program’s quality, timelines and costs can be minimized.
New clients can also use the standalone analytical services as an effective mechanism for evaluating BioDuro as an outsourcing partner for formulation development, manufacturing and other services. Consequently, the new standalone strategy is anticipated to help grow Bio- Duro’s business by utilizing various entry points within its continuum of service offerings. Expanding the analytical strategy from being a purely support function to a critical driver of the rest of the business functions within BioDuro is particularly aimed at enhancing the value that the company can provide to its customers.
As a key differentiator, being a smaller CDMO with niche areas of expertise, Bio- Duro is highly nimble and responsive and capable of forming deep collaborations with smaller/emerging (bio)pharma companies that desire flexibility and responsiveness from their partners and require additional technical and program management support. With its deep knowledge of the drug discovery and CMC drug development process, including its challenges and barriers to success, BioDuro is able and willing to help these partners fill in the gaps in order to accelerate development times.
Conclusion
Demand for analytical testing support is growing within the pharmaceutical industry as biopharmaceutical companies seek to maximize the use of internal resources for highly complex and proprietary activities. BioDuro, with both discovery and development components, has analytical expertise not typically found at other CDMOs that enables the establishment of analytical strategies and the resolution of analytical method challenges earlier on in the development cycle for reduced client-program risk in a more cost-effective manner.
References
- Healthcare Analytical Testing Services Market worth 4.13 Billion USD by 2021. Markets and Markets. 30 May 2016. Web.
- The 2016 Nice Insight Contract Development & Manufacturing Survey. 2016.
About the authors
Magdalena Mejillano
Executive VP and General Manager, CMC Solutions, BioDuro
Magdalena Mejillano is a proven industry leader with over 22 years of experience managing analytical contract organizations. She led the significant and consistent growth of PPD’s cGMP laboratory for 19 years, where it became well-renowned for its breadth and depth of analytical capabilities. Prior to joining BioDuro, she served as a management consultant at Bristol-Myers Squibb’s commercial biologics division, leading business process improvement initiatives. At BioDuro, she heads up the global CMC business — including formulation, analytical and clinical trial material manufacturing — and is based in San Diego, CA.
LinkedIn www.linkedin.com/in/magdalena-mejillano-a8b961a4
Email [email protected]
Lijun Duan
Associate Director of Analytic Development, BioDuro
Lijun Duan has over 10 years of technical and leadership experience in analytical development in the pharmaceutical industry. As Associate Director of Analytical Development at BioDuro, he leads an analytical team with his expertise in analytical methods development and GMP regulatory compliance in different drug product development stages. Prior to joining BioDuro, Lijun was a Senior Group Leader at PPD, managing an analytical group to provide quality analytical method development, validation and quality control testing services to clients in the pharmaceutical industry.
LinkedIn www.linkedin.com/in/lijun-duan-74b12232
Email [email protected]