Reasons for outsourcing to contract research organizations
Outsourcing offers a number of advantages to Bio-tech and Pharma companies. These including:
- Reduces the time (8 to 15 years) required to develop and bring a new drug to market
- Sponsor can convert the fixed costs of maintaining the personnel, expertise and facilities like data management necessary for clinical trial management into variable costs
- Non-availability of services in-house
- Knowledge of regulatory affairs
- Increased complexity of clinical trials
- Increased amount of data required from clinical trials
- Multinational and multi-center nature of current clinical trials
- Large requirement of patient populations
The pharmaceutical market uses outsourcing services from providers in the form of contract research organizations (CROs) and contract manufacturing organizations (CMOs). In recent years, the concept of a comprehensive single-source provider from drug development through commercial manufacture has emerged. This concept has been implemented by providers known today as contract development and manufacturing organizations (CDMOs).
CDMOs are a response to the competitive international nature of the pharmaceutical market as well as the increasing demand for outsourced services.[1] The best-positioned service providers focus on a specific technology or dosage form and promote end-to-end continuity and efficiency for their outsourcing clients. With lower-cost international manufacturers capturing an increasing percentage of the contract manufacturing market, specialization may be an effective hedge against loss of market share.[2]
Advantages of CDMOs
Outsourcing to a CDMO allows the pharmaceutical client to expand its technical resources without increased overhead. The client can then manage its internal resources and costs by focusing on core competencies and high-value projects while reducing or not adding infrastructure or technical staff. Virtual and specialty pharmaceutical companies are particularly well-suited to CDMO partnerships, and big pharmaceutical companies are beginning to view relationships with CDMOs as strategic rather than tactical.
Working with a CDMO also limits a client’s upfront capital investment for drug development, thus minimizing a project’s cost. By concentrating resources with a single-source provider, the outsourcing client can minimize technical transfer of projects or products, thereby reducing unforeseen costs and potentially speeding new products to market.
. In the Code of Federal Regulations (CFR), the U.S. Food and Drug Administration regulations state that a CRO is "a person [i.e., a legal person, which may be a corporation] that assumes, as an independent contractor with the sponsor, one or more of the obligations of a sponsor, e.g., design of a protocol, selection or monitoring of investigations, evaluation of reports, and preparation of materials to be submitted to the Food and Drug Administration." [21 CFR 312.3(b)]
