The global pharmaceutical industry has never been under such price pressures as it is now. This situation has been exacerbated by the rising costs of molecule and subsequent drug development, increased regulatory requirements and greater competition. These factors are in addition to other drivers such as escalating energy prices, direct labor costs and other overheads. While all of these factors are felt by both big pharma and smaller drug producers, it is the contract manufacturers, who lack control over pricing, that bear the greatest brunt.
Findings published at the end of 2001 by the respected Tufts Center for the Study of Drug Development in Boston, US, suggested that the average cost to develop a new prescription drug is US$802 million. Moreover, it still takes between 10 and 15 years to develop a new treatment from patenting the molecule to reaching the market. The most alarming fact, however, is that Tufts’ study also stated that had drug development costs remained in line with inflation, the typical development costs should stand at around US$320 million – nearly US$500 million less than the typical costs revealed by research.
Every pharmaceutical manufacturer is acutely aware of the need to comply with a variety of regulatory requirements. A furore developed at the time the US FDA announced its current FDA 21 CFR Part 11, since it appeared as though non-compliance would effectively shut producers out from the American market. In practicality, 21 CFR 11 is a documented validation process that while stringent, should pose most manufacturers few problems in compliance. Where such regulatory legislation impacts greatest, however, is on the contract manufacturers that must comply with all the regulatory standards for each customer and every market served.
At Cenexi, for example, the company must comply with a large number of regional health authorities, all of whom regularly make inspections, it must also satisfy all the overseas authorities in the countries the drugs it makes are sold. Coupled with these there is the over arching GMP standard to which the company subscribes. Finally, because veterinary medicines are also produced at the plant, there are veterinary standards to meet and their authorities to assure. All of these require documentation and time, with the resultant cost impact.
All pharmaceutical companies are under competitive pressure. While everyone in the industry would accept that time to market a new drug can be unbearably long, new treatments can still be copied by generic producers long before the development costs have been recovered. Consider that the development time for a new prescription drug can be 15 years and that a typical molecule patent may last as little as seven years. It is clear that potentially competition from generics can hit the original developer even as its own product reaches the market – driving down prices and lengthening the amortisation of the development costs.
Contract manufacturing can assist in both cost control and time to market. At Cenexi, a novel approach to the issue of competitive manufacturing has been adopted. Four primary missions have been identified and a team of expert pharmacists and pharmaceutical technicians has been assembled, as a Pharmaceutical Technical Support unit, to develop and deliver new methods founded on those undertakings.
First of the targets is to develop updated and improved documentation – the pharmaceutical dossier – of which the validation process is part. Such an approach aids simplification of compliance with regulatory authorities and speeds the validation of new products.
The second mission has been to improve and expand the analytical development and stability studies. The third focus is the validation of new processes. A team of six dedicated pharmacists and engineers have been charged with improving the validation of new products and maintaining the strictest GMP standards.
The final goal is the one with perhaps the greatest impact on pharma clients – that is process improvement. The objective is to develop solutions to production problems enabling the delivery of the best product attainable at the lowest price possible.
Contract manufacturers have convincing arguments for the service they bring to a changing pharmaceutical industry. To satisfy the needs of their clients and to meet the growth opportunities inherent in the market, contractors must embrace new production processes, must take greater responsibility in the validation and transfer cycle and must undertake firm commitments for both product quality and delivery. If the industry fulfils these criteria it has a very healthy future.