13 Questions to Ask Before Outsourcing Your Pharmaceutical project

April 2015 Newsletter

Whether it’s your first time outsourcing a project or your twentieth, finding the right company to partner with is essential for your success. Careful evaluation of your needs and of your potential partner’s capabilities is required to find the right match. This article points out some of the factors you should consider during that analysis.

  1. What kind of outsourcing partner do you need?
  2. With a straight-forward project, where you have validated methods and a good understanding of the chemistry involved, you probably need a contract manufacturing organization (CMO) to follow your directions and deliver a specific product with standard reports and analyses. For a more complex project, you may need a contract development organization (CDO), with a staff of experienced research chemists who can develop and validate new analytical methods, and provide a more intellectual contribution to the work. Somewhere in the middle are contract development and manufacturing organizations (CDMOs), who can do both. Only you can decide if you need a custom chemical supplier, a full partner in the drug development process, or something in-between.

  3. Which stage(s) of the drug development do you need to outsource?
  4. From active pharmaceutical ingredient (API) manufacturing, to formulation, to clinical trial support, to commercial product quantities, you want a partner with the expertise and equipment to grow as your product grows. However, beware of the “One Stop Shop”, who claim to be experts in all stages and all processes. While some companies can do multiple things well, there are very few who actually do everything well. In fact, the only companies that have successfully managed the entire pharmaceutical development pipeline are called “Big Pharma”. Most of those have changed how they do business, and now focus on discovery and marketing while outsourcing the stages in-between. If you’re unsure of your needs, one strategy is to use an organization capable of advising you on all aspects of the drug development process. Perhaps you should consider contracting the first stage. This keeps your options open to switch partners if things don’t work out. However, this will require you to manage multiple partners, and move materials and information between them. So be sure to find a good fit for you and work with that contract company exclusively.

  5. What are the most important factors for the success of your project – timeline, quality, price, or something else?
  6. You want to find a partner who understands and supports your priorities. You need to consider timeline, total cost (including licensing/royalty fees, payment schedules, rush charges…), location of supplier, intellectual property issues, reputation, methods, and more. Trade-offs are often required between time, quality, and price. You need to know that your partner shares your values, and will make appropriate decisions when necessary.

  7. Does this organization have the capabilities, facilities, or specific expertise you require?
  8. Whether your project is a small organic molecule or a biologic, you want to make sure the partners you are considering have the expertise in that area. If preliminary data suggest that this product requires special or extreme conditions (low temperature, high pressure, etc.), you need to make sure the company you are considering has both the equipment and expertise to handle that type of work. For process chemistry, can they confidently talk about times they have increased yields, reduced synthesis times, minimized waste, or eliminated toxic reagents while developing new formulas? Ask about projects they have done that are similar to what you are proposing, and ideally obtain references as well as talk to the people for whom they did that work.

  9. What does their facility look like?
  10. You may want to visit their site for a technical tour of their facility before committing; especially if it is a complex project with multiple objectives and scale-up potential. You may not be able to do an extensive quality audit, but you should be able to see their equipment, see how well it is maintained, see how stocked the warehouse is, and see the cleanliness throughout the facility. Ask about their FDA inspection history. This is also a great time to move past strictly business, and assess your working relationship with this particular company. Judge their flexibility and openness about technical details, as well as how forthcoming they are when problems arise. In order to have a successful relationship, your partner must have both the technical expertise and the personality to work with your existing team.

  11. Should your partner be operating under cGMP, and do they have that capability?
  12. Early in the development process, you can save money by not using cGMP labs. As the project moves into later stages of development and gets closer to the final API, you will need to operate under cGMPs. Check potential vendors for not only what they can do, but also how well they do it. Check their safety record and reputation with regulatory agencies, and see if they have been issued any warning or violation letters.

  13. What is the potential partner’s reputation and reliability record? Do they deliver on-time and on-budget?
  14. Your partner should be proud of their record, and anxious to share it with you. If they are not, be cautious. Talk to a few of their other customers – if possible, ones you found yourself, not just the poeple the company provided.

  15. What precautions do they have in place for data security and technology transfer?
  16. You will be entrusting some of your company’s proprietary data to your partner. Do they have appropriate safeguards in place to protect it? How will they handle transfer of materials and data? They should have regular backups of important data, secure storage areas for materials, and other basic security precautions.

  17. How will they communicate progress to you?
  18. Regular, timely, and accurate communication between you and your partner is crucial. You want to make sure you have a single primary contact person, you know who that will be, and are comfortable with them. You need a liaison who can speak chemistry as well as business, and is committed to the success of your project. You should insist on at least bi-weekly status teleconferences, along with immediate notification of significant events, changes to the timeline or quality, and prevent future misunderstandings. You may also want to ensure that your scientist can talk to the contract scientists, when necessary, and not have everything filtered through a middleman.

  19. Should you write a Request for Proposals (RFP) and send it out for bids, or should you select a provider and work with them to determine the project scope and parameters?
  20. Writing a RFP requires you to document the key aspects of your project. You will want to include background information, a general description of the services required, information on what materials and equipment you will provide if any, lists of what you expect your partner to provide, acceptable testing methods, and specific deliverables (materials, methods, and procedural details), as well as specific timelines. Make sure to spell out any critical assumptions, and be prepared for challenges from other bidders. You will still need to pre-screen potential partners, and select a handful from which to solicit bids. While writing a good RFP is a significant investment, it will force you to clarify and prioritize your needs, and ensures that each potential partner is bidding on exactly the same project.

  21. How should you evaluate the proposal?
  22. Responding to a RFP will require a significant investment of time and money for the CMO; not to mention, your own time to answer any CMO questions in sufficient detail. The proposals should include a complete scope of work description, with a full list of activities to be preformed, and a proposed budget. A Gantt chart detailing the project schedule is an important part of the proposal. It should be realistic, include allowances for unforeseen circumstances, and multiple options, if appropriate. A good partner will have covered and addressed some issues that had not occurred to you.

  23. Are the proposed timelines reasonable?
  24. Your timeline should allow for margins of error and delays, as well as identifying critical paths and contingencies. During the early stages of process development, some activities (such as optimization) may be skipped to save money or time. However, these activities will need to be addressed later, so make sure to keep your collaborative partners informed. Be wary of potential partners who say they can do whatever you want, on whatever timeline you request. You need a partner who will not be afraid to tell you when something is unrealistic or even impossible. Pay attention to how quickly a potential partner responds to your initial inquiries – this can be an indicator of what you can expect later.

  25. How do they deal with problems?
  26. As development proceeds, surprises are likely and will affect the scope, timeline, or other aspects of your proposal. However, commitments will have been made for clinical trials and commercialization, which will be expensive or impossible to change at the last minute. You need a partner who expects the unexpected, builds sufficient time into the schedule, and will point out potential problems immediately upon discovery. Ideally, you want them to take the initiative to identify possible solutions for a problem before they notify you of the problem.

    Because drug development starts with good chemistry…