Contract Manufacturing Competition

the past, contract manufacturing in life sciences has been largely confined to small pharma and biotech companies. Large organizations typically have only used contract manufacturing organizations (CMOs) to meet excess demand beyond their own manufacturing capacities or for packaging needs in particular geographic locations. The latter is intended to ease problems incurred when addressing local regulations, differences in native languages, and approved labels.

Photo courtesy of HollisterStier

In early 2006, we published "How To Add Contract Manufacturing to the Pharma Recipe for DDSN" where we noted that the intensifying pricing and revenue pressures on life sciences companies will need to be offset by faster product launches and better operational efficiencies. We pointed out that the traditional life sciences value chain will need to be transformed into a more networked structure. It should capitalize on manufacturing and supply chain efficiencies through CMOs and by improving its own supply chain capabilities.