Effective outsourcers will have competitive edge in 2020; KPMG

By Nick Taylor

- Last updated on GMT

Related tags Outsourcing

Effectively outsourcing a significant portion of work will give biopharm a competitive advantage in 2020, KPMG said.

In the past biopharm viewed having end to end operational capabilities as a competitive advantage but KPMG predicts a more flexible, outsourced model will give companies an edge by 2020. The shift towards this new model is already underway.

Companies in the industry have already started unpicking, to various degrees, their long-established network of internal capabilities that were built up during the heady days of free pricing and less competition​”, a KPMG report said​.

KPMG expects the trend to accelerate “with the potential for significant portions​” of activities to be outsourced and emerging markets performing some of the work. Many of the emerging markets winning outsourcing contracts are also being targeted by biopharm as growth regions.

Every possible opportunity to drive [over-the-counter] business in emerging markets should be explored in addition to a focus on speed to market, lowering the costs of development and efficient delivery of appropriate, differentiated quality prescription products​”, KPMG said.

Recognise the risks

While advocating an outsourced model KPMG also warns against risks of research collaborations and increased use of third parties. Biopharm should consider the impact of these relationships in reviews of governance and risk.

KPMG said: “Companies need to conduct a root and branch review of governance and enterprise risk management across the entire value chain from early research and development, through late stage development, manufacturing to sales and marketing​.”

Contract research organisations and CMOs potentially affect each of these steps. KPMG recommends supplementing internal checks with “completely independent and external experts who are allied with ethics, risk and governance​”.

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