During the COVID-19 pandemic, the biotechnology industry has stepped up to respond to the global health emergency, driving the expeditious approvals of several vaccine candidates. However, despite these successes, the pandemic has also revealed the fragility of the international bioeconomy to a world fractured along geopolitical lines. While pharma and biotech companies rightfully garner most of the plaudits, I ask whether revolutionising our contract development and manufacturing organisations (CDMOs) may be vital to building a more robust and responsive bioeconomy.
CDMOs, like contract research organisations (CROs), undertake fee for service work on behalf of biotech and pharmaceutical companies. While CROs focus predominantly on discovery and preclinical research activities, a CDMO typically offers services ranging from preclinical research (eg. cell line development) through to clinical or commercial manufacturing.
For emerging biotech companies, the ability to reduce high fixed costs while deconvoluting execution and technical risk is a clear advantage. For established companies, the ability to rapidly access specialist resources and capacity around key bioassay development, process development or manufacturing are also key advantages of ‘outsourcing’ to a CDMO. The ability to operate a biopharmaceutical company in a ‘leaner’ fashion has in part contributed to an explosion of the CDMO industry, growing from a global market of $90 billion in 2019 to over $117 billion in 2023.
While the demand for services is growing, CDMOs themselves are in fierce competition with each other around capabilities, service quality and cost, with many leveraging geographical cost differences to deliver superior savings to their clients.
In the post-pandemic world, there may be less scope or incentive to utilise international resources. The COVID-19 crisis has illustrated that a national biosecurity infrastructure is now an essential part of a national economic and security strategy, similarly to how energy, telecommunications, and transportation are viewed. As such, the ability to develop, manufacture, and package (fill & finish) a therapeutic or vaccine will quickly become part of a country's critical national infrastructure. With developed economies effectively shut down, the cost to secure the development and production of these products is negligible when compared to the wider societal benefit. Now, the challenge for market economies is keeping any crucial infrastructure productive and competitive during non-emergency periods. This means competing with emerging economies on cost across a range of distinct modalities, including chemistry and biology, and across a broad range of capabilities within the value chain.
Competing more broadly on cost, especially in the field of biologics, is also becoming more challenging due to the cambrian explosion of both the diversity and complexity of modalities entering biopharmaceutical preclinical development. This has challenged the ability to drive cost reductions through standardisation of processes, which can create economies of scale. Delivering infrastructure, which is elastic to demand and accommodating of high molecular diversity and complexity whilst also competing on cost, means breaking the triple constraints of time, cost and scope.
One approach to ‘moving the goalposts’ around this triple constraint is building leverage through integrated technology platforms that leverage physical automation, data science and potentially novel hardware or wetware (eg. scale down models).Such technology would ideally ingrain robustness, responsiveness, and redundancy into the fabric of the organisation. This approach is different to how many CDMOs make money, which is through ensuring a high utilisation rate of both physical and human resources.
CDMOs that focus on a specific modality may be able to build upon a unique data advantage they hold (being witness to a diverse range and high volume of client projects) to build internal data-centric tools that drive competitive advantage via speed, cost, or product quality. Conversely, CDMOs that focus on a specific part of the value chain may be able to develop technology platforms focussed around modular automation platforms (eg. for high-throughput downstream process development) to start building a data advantage, whilst maximising facility usage and minimising human resource dependencies. There are already examples of specific companies addressing these discrete parts of the workflows including Culture Biosciences, a bioreactor as a service company from San Francisco.
There are early signs indicating that parts of the CDMO industry are already moving in this direction. In 2020, Ginkgo Bioworks, a technology-enabled synthetic biology company in the US, announced a $1.1 billion loan from the Department of Defence to retain capabilities in part related to manufacturing infrastructure.In November 2020, we saw the launch of Resilience Biotechnologies with a $800 million round to build the next generation CDMO platform based on hardware and software innovation (it has since acquired the Canadian CDMO Therapure).
In 2018, Synthace, a former UK bioprocessing CRO which pivoted into the production of software tools for biology, through drawing a comparison between the integrated circuit industry, which broke the trade-off between cost and complexity through automation, vertical integration and software such as electronic design automation, was able to suggest how CDMOs could build next-generation integrated technology platforms – an approach it termed ‘Computer-aided Biology’.This approach was subsequently adopted by the UK-based CDMO Oxford Biomedica and announced in a 2019 partnership between Microsoft, Oxford Biomedica and Synthace. The partnership focussed on building data science, machine learning and automation levers in viral vector process development.
By investing into technology platforms like modular automation, data science and continuous bioprocessing, CDMOs will dramatically increase their efficiency in process development and manufacture of ever-more complex therapeutics. And this more agile development and manufacturing base will serve us well in delivering the complex biologic products and prepare us for the next global pandemic.
Dr Peter Crane is corporate strategy manager at Synthace