The move comes as a surprise as the current trend is for drug makers to outsource drug manufacturing because it is usually cheaper in the long-term. Indeed, efforts to increase R&D pipeline productivity have never been more aggressive, and clinical outsourcing is one strategy employed by big pharma to save on costs and stay in the competition. However it seems that the reality is different for small companies and Brisbane-based Progen said that manufacturing the fist step of its drug in-house saves it approximately AUD7.8m (€4.6m) in outsourcing fees to a contract manufacturing organisation. However, the firm said that while the first step of manufacturing the drug will be carried out at its Darra facility, a large US-based contract manufacturing company has been contracted to produce the final active ingredient (API), PI-88. In total, up to 150,000 doses of PI-88 will be manufactured in advance of the phase III trial starting next year. This strategic decision comes weeks after the End-of-Phase meeting with the US Food and Drug Administration (FDA) which plays a critical part in the rapid development of drugs with the regulator. At the meeting, the details on the specifications, stability and release procedures for the active ingredients and the final product were reviewed and discussed, and no issues were identified that would delay the manufacture of the Phase III product. Holding this meeting now avoids manufacturing related delays for the next step in clinical trial and forms the basis for proceeding efficiently to submitting PI-88's application to the FDA. "The manufacturing division at Progen has worked very hard to ensure that our company meets world class standards," said Justus Homburg, Progen's chief executive officer. "The successful outcome of this meeting is a direct result of their skills and dedication." In addition, Progen now has PI-88's manufacturing and quality control schedule defined and said it will fill excess capacity by renewing contract manufacturing services for other pharma and biotech companies.