The Enlightened Battles Of Biopharma Outsourcing
By Louis Garguilo, Chief Editor, Outsourced Pharma
In drug development, the threat level is always immanent. Too often there’s no alternative to preparing a detailed map of a landscape that may not exist.
For Big Pharma, survival comes through a series of difficult battles waged in an extended war against disease. For biotechs, each battle itself can be existential. For both the war and the individual battles, “outsourcing” is the inadequate label we’ve affixed to a potent strategy to assist in the cause.
In an initial article, we agreed the timing is good to consider how the biopharma outsourcing industry, borne of a real need for furthering this cause of drug development, has now taken on a transcendent existence of its own.
A bit too philosophical for an editorial on an industry and its service sector? Consider then: The biotechs not started; pharma pursuits and projects cut short; clinical trials not run; all for lack of strategic business options for much of the history of pharmaceutical development.
Fortunately, options now exist. They are manifest in the many forms of external and global service providers and partners. New paradigms are now enabled, and assistance is available to more people entering the drug development fray than ever before. Programs that can’t proceed “internally” are afforded a new hope via strategic outsourcing and partnering. As a result of biopharma’s enlightened externalization of services and programs, we have advancements in antibody drug conjugates (ADCs)), and technology platforms (e.g., inhalation devices and nano-delivery systems), are reaching patients.
So even if we (humbly) resist a higher teleology for our outsourcing industry, at the least it should be understood on this level of profundity.
Relationships To Build On
“The current model was effectively chained together in the 2000 era,” says Krisztina Zsebo, Biovest Consulting, LLC, picking up from her narrative on the industry, and referring to the enabling “triumvirate” of biotech, VC, and outsourcing. “It was a point when there were now enough biotech successes, so that contract providers of various types were sustainable, and CROs and CMOs for the first time became available for everything from discovery services, testing, development, and regulatory assistance to large-scale manufacturing.”
There was also a reduction in the delimiting of geographic barriers. Biotechs like Zsebo’s San Diego-based Celladon, a company she founded and where she served as CEO, might have preferred to find service providers close to home, but now weren’t afraid to venture afar. “We worked with people on the East Coast, some in the Midwest. In the later phases of the company, we did projects with European CMOs.”
Perhaps it’s particularly this relationship with CMOs that illustrates the advancements of outsourcing relationships. Celladon was already establishing a “commercial manufacturing platform” early in their development process – at phase 1 and moving through phase 2 – and even working towards the construction of a manufacturing facility.
As Zsebo describes it, “The dilemma in biotechnology is you’re damned if you do, and dammed if you don’t, in terms of investing in manufacturing. You run the risk of making investments when your clinical data doesn’t yet support commercialization, but if you have a product that’s successful, most likely manufacturing is going to be your rate-limiting step for approval and launch. What’s done within this context, then, is you’ll put some money at play to fund long-lead items. The bulk of the costs usually don’t kick in until the construction phase.”
Such a stratagem comes with the prerequisite of trusted business partnerships. Celladon started early to establish relationships around their gene therapy for heart failure, with CMOs Novasep of Belgium, and Switzerland-based Lonza’s operations in the U.S. “Both of those were staged in terms of relatively modest and incremental investments to provide the lead time if the clinical data supported rapid commercialization,” explains Zsebo. Well worth the forethought: the Celladon therapy garnered breakthrough status with the FDA, potentially further shortening timelines.
“With a relatively modest investment,” says Zsebo, “we basically did design and some engineering. It was about a 15-month project just to complete the design work for the size facility we’d need. Working with our partners, we established a plan and permitting requirements to get everything to the stage where we were able to push a button, if the next trial had supported commercialization.”
The Celladon-Lonza relationship led to a publically announced, future commercial production agreement for MYDICAR, Celladon’s enzyme replacement therapy for advanced heart failure, while the program was in Phase 2b clinical development. According to a press release from November 2014, the agreement was the result of a multi-year relationship, and provided for the start of pre-construction activities, future resource allocation, and “the opportunity to trigger construction of the dedicated facility” and secure a commercial supply arrangement.
“Our partners were paid for engineering and other upfront work, and obtained a future commitment for manufacturing,” says Zsebo. “It was a deal that started with relationships years prior.”
The Life Cycle
An enlightened service-industry model is authenticated if all segments of the life cycle are planned for and faced with equanimity. Celladon received some undesirable results from a late-stage clinical trial that put their project on hold in 2015. As unfortunate as this can be, it’s precisely in this event we acknowledge the value of outsourcing, and understand why it’s had such a positive impact on both biotechs and Big Pharma.
“Obviously, everyone in our company and at the CMO would have been happier with more positive data, and the ability to move forward immediately to build the plant that was designed,” says Zsebo. “But outsourcing provides even this option of starting a manufacturing-plant project during early clinical development.”
Zsebo left Celladon last year to allow for new leadership when Celladon Corporation and Eiger BioPharmaceuticals, Inc., a privately held biopharmaceutical company, announced the intention to merge. Once again, investors will play a key role, with a syndicate committing to putting $39.5 million into the combined company, according to a press release. The proposed merger would create a clinical-stage company with “a diversified development portfolio of product candidates,” including for pulmonary arterial hypertension.
In other words, a continuation in the pursuit of new drugs for patients, and yes, in the chase for revenues. We can be sure that once again outsourcing will combine with biopharma and capital to bring forth new scientific opportunities. For Krisztina Zsebo and so many like her, there’s more than a possibility of getting lured again directly into the mix. If anything else, outsourcing allows us to continue to find new beginnings and extended pathways for drug development.