Choosing the right contract manufacturer

By Kirsty Barnes

- Last updated on GMT

Related tags: Contract manufacturing, Manufacturing

A good selection process, with a realistic set of selection
criteria is essential when looking for the right contract
manufacturing partner, according to a new Datamonitor report.

Choosing the wrong contract manufacturer can be a disastrous move for a drug company, leading to delays in supplies or even jeopardizing regulatory approval.

As a first step in the selection process, firms should construct a contract manufacturing organisation (CMO) database using tools such as recommendations, journals and directories, states the report.

This will enable a company to conduct a preliminary assessment, based on essential criteria such as its location, good manufacturing practice (GMP)-compliant facilities and technical capabilities.

This should leave the firm with a list of potential candidates to further scrutinise, looking into important details such as manufacturing quality and capacity, as well as taking into consideration other aspects such as reliability, reputation and relevant experience.

Once the potential candidates are whittled down to a short list, proposals can be requested, and the successful vendor chosen on the basis of additional factors that fulfil the company's needs such as cost, timescale, financial stability, trust, communication and cultural fit.

The report, titled "Pharmaceutical Outsourcing Part 1: An Introduction to Contract Manufacturing Strategies"​ also points out that as the contract manufacturing market continues to shift from the West to the East, vendor location is one of the key considerations companies should make when choosing a partner.

Already widely used for basic active pharmaceutical ingredient (API) and intermediate production, the low-cost destinations of India and China are expected to become popular locations for more complex on-patent API and biologics contract manufacturing over the next few years as intellectual property protection and the business environment continues to improve.

There is an increasing temptation to find ways to save money by offshoring such critical manufacturing processes, because as the complexity of these manufacturing function increases, so too does the cost.

However, the report stresses the importance of considering the realities of using an offshore vendor carefully before making a decision.

"Companies need to really consider logistical factors and risks to select the desired location of their CMO."

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