How Do You Choose The Right Contract Manufacturer For Your Pharmaceutical Product?

Posted by Wellspring Pharma Services

WS089Pharmaceutical companies face a critical decision in choosing the right contract manufacturer for their product's success and ultimately for their company’s performance.

While price is an important consideration, there are many other factors to consider, and in our experience, we have found that it may come down to a lot more than who can manufacture most economically.

Here are 6 Key Considerations in Choosing the Best Pharmaceutical Contract Manufacturer:

  1. Geographic Location: Provided there are CMOs in your area, start locally. The closer they are, the less onerous travel becomes. Your QA group is going to want to go in and do an audit. If they are somewhat local, that's just a matter of jumping in a car, or maybe a train ride to the nearest town to do it. Otherwise, you’re booking flights and hotels and managing all the other incidentals which just adds to the cost. 
  2. Capability: This is very critical. Does your CMO have the capability and expertise required to manufacture your product? Do you want to be their first experience with a product such as yours? The majority of pharmaceutical companies don't want to be a CMO's trial run of their product type.  Also, does the CMO have the right scale of equipment? This is another really important criteria.
  3. Quality and Compliance: Do they have a good track record with the FDA or other regulatory bodies? Have they had any recalls attributable to them - which is a very important factor. Have they had a recent inspection and will they share their report with you? You cannot overstate the importance of quality and compliance. You don't want to go on back order because of something that they've done incorrectly in their shop or even worse - should they get a warning letter and you’re looking for approval for a new product. You're not going to get approval with that CMO if they are under a warning letter.
  4. Responsiveness: How quickly a CMO responds can be an indicator of future dealings. If they're slow at the outset, why would they improve once they have your business? As you progress through your due diligence process, are all areas of their business as responsive as their Business Development group? Don't forget that  all their Business Development team wants is new business and typically, they will do whatever it takes to get it. So, really focus on the people that you're going to be dealing with on an ongoing basis: your quality contact, and your manufacturing contact, for example. Ask yourself this important question: do they own the product like you want them to?
  5. Communication: Clear and open communication channels are key to a successful transfer or development of your product. Getting to know team members can give you valuable insight into how a company works and what they value.
  6. Scale: Would you be a little fish in big pond? If your production requirements are relatively small, will your production be bumped in favor of a larger client, a more productive, or a more profitable product? Again, take a look around you, see what you are dealing with. Who are the other clients that the CMO is working with? If you are a small startup, do you really want to be in contention with a large-scale company with high volumes for the same manufacturing space? Also, what are the costs of your production getting bumped? If you go on backorder, these days with a lot of the large chains in North America, there are significant penalties to being out of stock. You could risk being delisted. You could have large out of stock fees. You may jeopardize your relationship with the chain drug store. Those are all things that need to be taken into account. Again, how does your choice of a CMO impact your company's revenue stream? Your shareholders and your investors may be very put out by the fact that you miss your revenue targets because you don't have any product supply. So, it's really important.

There Are More Important Elements To Consider Beyond The Price

image-keypeopleEvery company that comes to see and evaluate us for manufacturing and packaging their pharmaceutical product looks at the criteria that we just outlined very differently - even within the same client segment.  Whether you’re a small or large pharmaceutical company,  the ranking of the criteria we just outlined is based on your own particular preferences, product needs, internal sourcing philosophies, economic conditions and internal policies.

Based on our experience in the pharmaceutical contract, manufacturing, and packaging industry, it seems that in general, price, breadth of services, reputation and financial stability are the higher level considerations for selecting a supplier.

In the end analysis, it’s the quality, responsiveness, the communication you have with your supplier, the people at the manufacturing facility, and the technical expertise that keep pharmaceutical companies with a particular CMO. It's interesting how most companies may focus on price initially, but it seems that a good price isn't as important if there are supply interruptions due to late deliveries, quality issues, account neglect or apathy. At that point, price doesn’t seem to matter as much.

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Topics: Quality & Regulatory

WellSpring Pharma Services is a full-service provider of pharmaceutical contract manufacturing and packaging outsourcing solutions for solids, semi-solids, and non-sterile liquids. WellSpring offers full-service contract cGMP manufacturing, packaging and analytical testing services from a single FDA inspected and Health Canada licensed facility.

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