How Sponsors and CDMOs are Preparing to Manufacture APIs for Complex Generic 3 Criteria for picking the right CDMO partner

The vast majority of prescribed drugs, approximately 80%, are generics.  They comprise a sizeable and growing segment of the pharmaceutical marketplace.  In the U.S. alone, the generic drug market reached a value of $115.2 billion in 2019, having grown at a CAGR of 11.7% since 2014.  It’s no wonder. When available, generic drugs are chosen more than 90% of the time. Manufacturing of generic drug APIs, long ceded to China, is returning to Western countries out of abundant concern about the potential for shortages should China decide to curtail supply.  Forward-looking CDMOs are preparing to manufacture them.

This article will focus on the three criteria for choosing the right CDMO partner as generic drugs—like many drugs–have grown increasingly complex.

Factors driving growth of generics

Globally, the generic drug market is more than triple that of the U.S., reaching $367 billion in 2019 with a CAGR of 5.7% during 2014-2019.  Global growth is expected to accelerate according to various industry reports, reaching $738 billion by 2026 and growing at a CAGR of 10.0% or more during 2019-2025.

Generics are off-patent drugs that are bioequivalent to branded medications in terms of dosage, strength, quality, form, effect, intended use, side effects, and route of administration.  Largely because they are equivalent to branded drugs in quality and performance, there has been a substantial rise in their production for two main reasons.  :  1) They are less expensive than branded drugs (unless insurance companies have a reason to favor branded medications), and 2) they do not require extensive research and testing. For regulatory approval generic drug makers need only submit data to show they are bioequivalent. 

Another factor driving the growth of this pharmaceutical sector is the rising prevalence of chronic diseases such as diabetes and heart disease, as well as the large number of patent expirations. 

Branded generics

Not all generic drugs are unbranded. Branded generics, which comprise 21% of the generic market, bring to the market new formulations of off-patent drugs.  Although sold at a higher price point than generics, branded generics are still less expensive than branded drugs for patients, and more profitable for pharmaceutical companies.  The sector is expected to grow at a CAGR of 8% in the next five years. 

Ordinary generic drugs are usually known by their chemical name.  Branded generics, on the other hand, are given names that are meant to drive recognition and consumer preference. Digitek, for example, is a branded generic of digoxin, so named to increase the likelihood that patients will request it by name.

How is the pharmaceutical industry preparing for onshoring generic drug API manufacturing? By choosing the right CDMO now

It has been decades since Western countries have manufactured generic drugs, so essential to health and quality of life. But now, as trade disputes proliferate and Western countries realize they are vulnerable to shortages of needed medications, production is returning to the West as a matter of national security.

It has been decades since generics were manufactured in the West, and in that time generic APIs have become more complex. Sponsors onshoring critical complex generics, whether ordinary or branded, would do well to establish relationships with CDMO manufacturing partners that meet the following criteria:

1.  Experience with and a system for handling complex chemistry projects
   Seqens North America is an example of a CDMO that has been involved with many complex API programs and is prepared to manufacture generics, no matter how complex.  For example, one project required 27 chemistry steps, far more than the average of 3-7 steps. The program involved synthetically producing a compound thought to have therapeutic value, which occurs naturally in a marine environment.  Although possible to harvest the material from natural sources, that process proved too difficult and too costly.  Synthesizing it was the only viable option, and the sponsor turned to Seqens North America.
   
   Reviewing the proposed chemistry in the literature led only to information about small scale development. Optimizing into manufacturing was going to take significant effort.
   
   To make the project manageable, our experienced team broke the program into three sections. By so doing we were able to prepare and execute an overall project plan that was reasonable and that could assure a high degree of success. For the first two sections totaling 19 chemistry steps, we had two teams working in parallel. The final eight GMP steps, which required isolation, purification and other unit operations, were performed in our GMP manufacturing facility.  It is a highly efficient system and one we utilize often for the many complex chemistry projects we handle.
2. Equipment to handle any contingency
   With complex multistep chemistry, we never know what challenges may arise as we scale manufacturing, or which step might result in a poor yield or an impurity that cannot be isolated.   In order not to lose time, it is imperative that the CDMO have multiple pieces of equipment of different sizes and materials readily available that can be utilized to problem solve quickly. This is essential.
   
   It is also important that the CDMO have maintenance contracts on all equipment, assuring it is well maintained and regularly serviced.
3.  Excellent project managers
   We have many times discussed the importance of seasoned project managers who see to it that projects stay on course and within budget, and who communicate regularly, transparently and often with sponsors. They are the key to timely completion of projects. 

Summary

Forward-looking CDMOs are preparing for the return of complex generic drug substance manufacturing to Western countries.  Sponsors should prepare too. 

1. Find CDMOs with experience manufacturing today’s more complex APIs.  
2. Make sure the CDMO is sufficiently well equipped so that any chemistry problem can be handled without having to send out to specialized labs, keeping projects on track.
   
3. Look under the hood at the project manager, who is the key to assuring adherence to project timelines.

For more articles on project managers, check out the following: “5 Important Things to Look for in Your CMO’s Project Management Capabilities,” “What Does It Take to be a Good Project Manager for Drug Substance Development?” and “Does Your CDMO Manage Multiple API Development Projects Well?” Or to ask us questions about our project managers, call us at (978) 462-5555 or email us at info@pcisynthesis.com.

About the Author

Ed is President & CEO of SEQENS North America (formerly PCI Synthesis). He serves as a co-chair of the New England CRO/CMO Council and sits on the Industrial Advisory Board for the Department of Chemical Engineering at UMass, Amherst. Ed is also a long standing member of the American Chemical Society and advises the Bulk Pharmaceutical Task Force of the Society of Chemical Manufacturer’s and Affiliates (SOCMA)...

Do you have questions? Talk to Ed.