If DCAT Week was Any Indication, Bright Times Ahead for CDMO Marketplace

I recently had the pleasure of once again participating in DCAT Week in New York City.  Each year I’m amazed at the level of expansion, innovation and evolution taking place in the pharmaceutical development and manufacturing industries and this year was no exception.

Hosted and organized by the Drug, Chemical & Associated Technologies Association (DCAT), this year’s event provided a great opportunity for high-level strategic meetings with key decision makers, timely educational programs and great networking opportunities. 

A highlight of DCAT Week for Seqens was our recognition at the Life Science Leader CMO Leadership Awards dinner.  We received a total of 12 awards for quality, capabilities, compatibility, expertise, reliability, and service across big pharma, small pharma and a combined category. We were also recognized for our work across key specialty award categories: accessible senior management, innovation, reputation, right-first-time, state-of-the-art and strength of science. We were honored to receive these awards and they truly validate our approach, our people, and our commitment to excellence in everything we do.

The inspirational DCAT Week keynote address featured Dr. Frances H. Arnold, Nobel Laureate in Chemistry in 2018. Dr. Arnold, professor of Chemical Engineering, Bioengineering and Biochemistry and the Director of the Donna and Benjamin M. Rosen Bioengineering Center at the California Institute of Technology, was awarded the Nobel Prize in Chemistry in 2018 for pioneering the use of directed evolution to engineer enzymes. She shared her experiences, the challenges and key milestones achieved.

Other speakers who were part of the Executive Insights Forums, included Marc Casper, president and CEO of Thermo Fisher Scientific, and executives from Bristol-Myers Squibb and Spark Therapeutics. They discussed key issues shaping the current and future direction of the pharmaceutical industry, including drug development, manufacture and supply.

What struck me the most during the event was the level of innovation taking place in the industry. Innovation in technology, supply channels, medical devices and generic pharma products. Companies continue to push the envelope in science, providing treatments and therapeutics that are drastically improving patient outcomes and helping companies more easily live with chronic conditions. 

Rise of Offshore

Another key trend I noticed was the growth of offshore companies from places such as India and China, that are providing much-needed materials and manufacturing to U.S. firms. About  20 years ago, many U.S. Contract Development and Manufacturing Organizations(CDMOs) failed to understand the impact that offshore manufacturers would have on their business growth because of the lower prices and cheaper labor they could provide.  Today, however, they understand the significance and recognize the value that offshore firms can provide by partnering with them for specific services or to obtain scarce raw materials.  They now recognize when it makes sense to conduct activities in their own plants and when it makes sense to partner with an offshore provider.

Innovation Drives Innovation

Another thought that came to me during DCAT Week was the evolution of specialized innovation that is occurring.  Ten-to-fifteen years ago, the low hanging fruit of innovation and need was being met.  Chemicals for heart disease, cholesterol-lowering drugs and other broad-based conditions were being developed. The cost for innovation was high, but pharma firms also understood that the return on investment would also be high.  Now that many of the big discoveries for block-buster drugs have been found, companies are now looking to specialized treatments and therapeutics, such as orphan drugs; specialized technology, such as gene replacement therapy; and treatments for niche diseases with smaller populations, such as Cystic Fibrosis.

Innovation is becoming much more specialized and there are a host of specialized CDMOs that do one thing very well, such as chromatography, extraction of natural substances or cryogenics And, when the return on investment, regulatory hurdles and costs of producing and manufacturing specialized drugs within these smaller, specialized markets grows, companies are becoming more innovative in how they deliver.

While optimism abounded at DCAT Week, make no mistake, it also revealed key challenges the industry is facing.  The high costs of drugs – not only on consumers, but on the firms that make them – was heavy on people’s minds. There also needs to be a better balance on the need for strict regulatory controls with the need to bring new generics to the market faster. And, we also need to raise universal quality standards around the world to make it easier to partner with offshore firms to deliver a level of services that sponsors deserve. 

With another DCAT Week in the books, however, thanks to bright minds and dedicated companies, I’m confident that the industry is moving in the right direction and innovation and business growth is moving full steam ahead.