Posts Tagged Outsourcing

Up and Away, M&A

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Mergers and acquisitions are positive for the CDMO industry, but there is a downside. Mergers and acquisitions (M&A) are a central feature of the contract development and manufacturing (CDMO) industry today. Several new deals are being announced every month, some of them quite substantial, and these deals are reshaping the industry. CDMOs are in great […]

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Big Pharma Capex Continues to Grow, but Rate Slows

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Spending by global bio/pharmaceutical companies on new plant and equipment grew by an average of 2.7% in 2016, compared to sales growth of 4.4% (see Figure 1, below). This is the first year in recent times that revenue growth has outpaced capex growth. Moreover, the increase in capital expenditure represented a significant decline from the […]

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What’s Next for the CMO Industry?

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CMOs that offer an innovative service-oriented model will dominate the industry. Contract manufacturing and contract development and manufacturing organizations (CMOs and CDMOs) are an entrenched and critical component of the bio/pharmaceutical industry, but they have proven to be more important to some segments of the industry than others. A bio/pharma company’s relationship with its CMOs […]

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CMO Exits Reduce Pharma Manufacturing Capacity

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The number of CMOs is shrinking due to acquisitions, exits, and compliance problems. Additional capacity is being lost as more CMOs pursue proprietary products to gain a better return on their assets. And unlike 15 years ago, when the industry first took off, there isn’t a lot of available capacity to bring into the industry. […]

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In-Licensed Drug Products Can Be a Signal of Future Outsourcing

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Of the more than 230 New Molecular Entities (NMEs) approved between 2003-2013, over one-third were in-licensed by the sponsor receiving the approval. Recent research by our team showed an unexpected and significant difference in manufacturing status between products originally discovered in-house and those in-licensed from external partners. During this period 66% of in-licensed NMEs were […]

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CMO Industry Thins Out

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The number of CMOs is shrinking due to acquisitions, exits, and compliance problems. Additional capacity is being lost as more CMOs pursue proprietary products to gain a better return on their assets. And unlike 15 years ago, when the industry first took off, there isn’t a lot of available capacity to bring into the industry. […]

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Positive Outlook for Outsourcing: Contract Services Ride High as Funding Floods Bio/Pharma

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Early-stage and mid-size bio/pharmaceutical companies have enjoyed an embarrassment of riches over the past 18 months. The window for initial public offerings (IPOs) re-opened, at least for a while; global bio/pharmaceutical companies continued their frenzied pace of partnering and acquisition activity; and venture capital spiked up as the prospects improved for rich exits. Because the […]

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The Outlook for the CMO Industry

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The outlook for the contract manufacturing industry is being shaped by several significant trends. The well-financed pipeline makes the near term outlook favorable, but much depends on the number of new approvals for small and mid-size companies. Injectables CMOs should get better pricing thanks to tight capacity. Mergers and acquisitions will consolidate the industry and […]

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When Payers Refuse to Cover New Drugs, CMOs Take a Hit

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More health systems are saying no to reimbursements for new drugs; CMOs must adjust strategies. The value of the customer relationship to a CMO is a function of two variables: unit volume and price per unit. Both variables are contentious issues: bio/pharmaceutical companies are putting enormous pressure on their CMOs for lower prices, while their […]

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