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The Future of Contract Manufacturing for the Pharmaceutical Industry

Jessica Clifton
The Future of Contract Manufacturing for the Pharmaceutical Industry

What Does Contract Manufacturing Look Like In Pharma?

Many factory productions can be outsourced to contract manufacturers (CMs) in order for businesses to continue providing quality products to their customers in a cost-effective way, and so they can focus on other aspects of their business, increasing their overall productivity and efficiency, and improving their bottom line.

Due to the COVID-19 pandemic, the pharmaceutical sector sought contract manufacturing in a big way. Its growth from US$934.8 billion in 2017 to $1.17 trillion in 2021 gives an insight into the exponential boom this industry is experiencing, although the actual figures could be much higher due to better healthcare becoming a global priority in 2020.

In order to keep up with the demand, pharmas have been burdened with high financial performance, especially when it comes to buying and running expensive equipment for the mass production of pharmaceuticals. To combat this, many companies have begun outsourcing their manufacturing to CMs who have the equipment, facilities, and labor force to carry out a more cost-effective production. This form of outsourcing is a game changer.

Six Future Developments We’ll See in Contract Manufacturing

Partnering with the right contract manufacturer is becoming a practical trend among businesses, especially as CMs continue to develop and expand their own services to keep pace with ever-evolving global markets.

Here are six developments we expect to see in contract manufacturing for the pharmaceutical industry:

1. Improving performance with better AI and electronic platforms (e-platforms)

Many CMs are incorporating artificial intelligence and other technological innovations to become more cost-effective and speed up production time. Digitizing the services of pharmaceutical Contract Development and Manufacturing Organizations (CDMOs/CMOs) will ultimately account for greater efficiency in delivering products to target customers.

Data points to the growth of the pharma industry are mainly driven by incorporating advanced technologies, such as using machine learning to classify digital images of cells, or automated data gathering and analysis to find solutions to complex diseases, like Alzheimer’s. Similarly, pharmaceutical CMOs are constantly developing AI technology in order to facilitate better risk detection and, in turn, improve the quality and safety of pharmaceutical products.

2. Real-time, remote tracing

In order to monitor the manufacturing process, pharmaceutical firms conventionally audit or supervise their CM’s production and delivery processes. But, as contract manufacturers innovate their procedures, product conditions can now be checked remotely.

This form of real-time tracing is made feasible by the Internet of Things (IoT), which allows companies in the pharmaceutical supply chain to share data and immediately respond to any issues or events. As a result, the pharmaceutical industry will be better able to oversee the manufacturing process and supply chain, as well as orchestrate outcomes more accurately.

3. Secured channels for supply chains

Despite its apparent benefits, electronic communication may also pose risks to the future of contract manufacturing. A patented vaccine formula, for example, can be stolen if the online database gets hacked or if the formula is sent via unsecured channels. Therefore, serialization laws are already in place to safeguard important data.

Third-party manufacturers typically use systems that protect the blueprints of production and sensitive information from malicious entities. This brings us to the next development we’re seeing in contract manufacturing: the use of blockchain.

4. Introducing blockchain

Another way in which contract manufacturing models are making technological features safer is by introducing blockchain and other cybersecurity mechanisms. Blockchain in particular is proving to be a significant business asset in the pharmaceutical industry because of its far-reaching applications, all of which are protected by revolutionary cryptography technology.

Using blockchain’s ledger system, companies in the pharmaceutical supply chain, including CMs and pharmaceutical firms, will be able to scan and record barcodes every step of the way, creating an audit trail that can be tracked by all parties involved. Blockchain can also be used to incorporate sensors into the supply chain; factors like temperature and humidity can be recorded in the ledger system, which is particularly important for temperature-sensitive medicines like insulin.

In this way, blockchain secures and streamlines the pharmaceutical supply chain by allowing everyone involved to track every step of the medicine’s journey. Not only does this facilitate a smoother flow of operation, but it also helps prove the authenticity of a drug. By introducing this feature, pharmaceutical companies that partner with CMs can be assured that their product is handled and distributed safely.

5. Specialised services for certain niches

A service that we see being readily accommodated by CMOs in the pharmaceutical industry is developing precision or personalized medicines for small batch productions. Facilitating this is the advancement of new equipment that can manufacture small batches of goods quickly.

Precision or personalized medicines put an end to the ‘one size fits all’ treatment options for individuals who face particular illnesses or diseases. Being able to fulfill these medical requirements requires the pharma manufacturing process to adapt to small batches of products.

This also has benefits in allowing pharmaceutical products to be manufactured and distributed with urgency, such as when a sudden order is needed for an out-of-stock medicine in a particular location. In some cases, such as Ebola outbreaks in Africa, diseases pop up out of nowhere and the minimum demand for medicine fluctuates depending on the cases. This not only necessitates a constant backup production but also the capacity for small batch productions in order to avoid the risks of expired medicines.

6. Late-stage customization

The final development we see in contract manufacturing for pharmaceuticals is late-stage customization, when the production of a particular good is only pre-assembled, meaning that it can be processed at any time depending on market demand.

Not only does this reduce the chance of errors occurring, but it also creates a more efficient production process by freeing up storage space and requiring fewer stored materials. But the biggest benefit of late-stage customization is ensuring that all labels and packaging are compliant with up-to-date legislation.

This is particularly pertinent to the pharmaceutical industry, where serialization legislation is used to safeguard against counterfeit medicines. Now that more pharmaceutical CMs are offering late-stage customization, labels and packaging can be tweaked right up to the last second with variable data, depending on the market, region, or customer that the medicine is being supplied to. This ensures that all pharmaceutical labels and packaging are compliant with the most recent regulations.