What You Should Expect From A High-Functioning CDMO

By Mark Roache, VP of Cell and Gene Therapies for Quality Executive Partners, Inc. and President of BioQPartners, Inc. and Sarah Boynton, owner of Biopharma Staffing and Consulting Solutions, LLC

For the first time in history, we are entering an era where diseases can be cured, including diseases that have had little to no treatment options available. Unlike small molecule medicines, or even most biopharmaceuticals, cell and gene (C&G) therapies are driving this promise of a functional cure.  This amazing potential has created a gold rush of small companies (we will call them sponsors, since their goal is to sponsor commercial license applications), focused on the development and commercialization of C&G therapies.  However, just like that first gold rush in northern California in the middle of the 19^th century, this new drive to be first has created huge disruption and has unearthed novel challenges as sponsor companies move towards their goal of license approval.

This is the next topic in a series of articles aimed at discussing that disruption, the challenges that go with it and at least some ideas on how to successfully navigate a development program to approval.  The first article presented the key themes at a high level, and the second discussed the challenge of forming a mutually beneficial relationship with early-stage investors. 

In this discussion, we will discuss the question of whether to make or buy early GMP material as a sponsor company, how to work effectively with a contract & development manufacturing organization (CDMO) should the decision go in that direction, and how to set the right tone as a CDMO when embarking on a new relationship.  We will cover this broad topic in two parts – this first part will address the process of deciding whether to engage with a CDMO and the subsequent selection process.  The second part (to be published soon) will pick up immediately after selection and will cover how to make the partnership between the client company and CDMO mutually successful.

Make or Buy for Early GMP Supply

In the very early stages of development for a novel therapy, it is typical for small quantities of investigational drug substance to be produced in a development lab.  This material will likely be used for characterization, for small-scale animal studies and for analytical method development.  Data from this initial work may be used to demonstrate the potential of the technology being developed, with the intention of attracting investment funds or collaborating partners.

Following this path, sponsor companies will soon reach the point of needing to scale up or scale out the production process and make it sufficiently robust to be performed reliably in a manufacturing setting.  Material demands will increase as test methods are developed and qualified, as early stability studies commence and eventually as plans are established for initial clinical trials.  At this point, the technical and scientific need for consistency and process control will become imperative. Moreover, the need to apply appropriate GMP controls for clinical supply will become a regulatory and ethical necessity.  The sponsor must now decide whether to perform process development and GMP manufacture in-house, or to seek a partnership with a CDMO.

We have seen examples of small, startup sponsor companies with no previous experience of process development and GMP operation attempt to keep this process in-house.  In all such cases, it did not go well.  The challenges of at-scale manufacture and the learning curve for GMP operation are too great.  For such companies, the make or buy decision has therefore an inevitable outcome – partner with a CDMO.  This article is written for an audience made up mostly of staff from such companies.  We hope you read on and find the content useful.

For commercially established C&G therapy companies (this is a small and exclusive group), the make or buy decision may have more degrees of freedom.  If the company has an existing GMP facility, and if the company has staff with significant process development, analytical and operational expertise in the GMP space, then in-house development is a strong option, all the way to commercial volume and beyond.  While this article is not written primarily for the in-house path, readers involved with in-house manufacturing will find some aspects of the following sections useful when applied in this different context.

It is important to note that when the initial make-or-buy decision leads to a CDMO partnership, it does not, or at least should not, preclude the eventual creation of in-house GMP development and manufacturing capability.  The heavy engineering focus of such projects to build out capacity, with large capital outlay and extended durations, requires separate skill sets and will not be discussed further here. 

However, as we consider make-or-buy, we have to recognize the hard facts of establishing new GMP manufacturing facilities.  Such buildouts are expensive, often running to hundreds of millions of dollars.  These projects also take a long time, with the fastest construction and qualification projects coming in around the 2-year mark.  All of this means that even if a sponsor company fully intends to establish its own production capability for launch or commercial operations, unless that facility exists already, the decision for early development falls by default to CDMO partnership.

CDMO Partnership – Initial decision and strategy

When a sponsor company is faced with the green light of continued development of a novel therapy into early GMP manufacture, there should be celebration. However, some folks may at the same time feel trepidation about the upcoming challenge, i.e. the formation of a relationship with a CDMO. In many cases, the sponsor represents a startup that has a vast amount of technical knowledge and experience yet is lacking the resources and expertise to manufacture their products in-house, so they turn to CDMOs for assistance. If, like the authors, you’ve been around this industry long enough, you might have a story of how a CDMO relationship was difficult or problematic.  You will certainly know that the added complexity of shepherding two organizations, the sponsor and the CDMO, with incomplete alignment of goals, will present challenges and complexity. Murphy’s law is waiting in the wings to rear its inevitable head at any moment.

If it is any consolation and speaking of physical laws (Newton’s third – every force has an equal and opposite reactive force), client-side frustration is met and matched at the CDMO. This is the result of the challenges in supporting each of their clients’ programs at that CDMO, for all the same reasons.

But it doesn’t have to be this way!  Just like any relationship, there’s someone for everyone and we all need to equally own our partnerships.  It starts with selection, and moves on with shared goals, effective communication, and awareness and respect for our differences.

Selection of the Right CDMO:

One of the key challenges a sponsor will face is the need to scale their production processes quickly and efficiently. Choosing the right CDMO partner can make all the difference in this regard. Remember the wise words of the grail knight from Indiana Jones, choose wisely. Because as many readers may know, choosing poorly can lead to major issues down the road, that will not be evident until sometimes too late.

When selecting a CDMO partner, small startups must consider a variety of factors, including expertise, capacity, and cost. They must also ensure that the CDMO has experience working with their specific product type, whether it be a small molecule, biologic, or cell and gene therapy. This is especially important in the C&G space, where the manufacturing process is highly specialized and requires novel technologies combined with unique expertise and capabilities.

At this point, it’s important to appreciate a realistic picture of the CDMO business.  In the acronym CDMO, there are two service areas to consider:  Development and Manufacturing.  Some CDMOs focus on the work of process and analytical development, with a business model that takes the sponsor client up to commercialization and then support for launch, but with a handoff to a larger-scale manufacturing organization.  Other CDMOs focus on a model that optimizes for scale, numbers of batches and ultimately manufacturing throughput as a business model.  In either case, one will see the other as necessary for the main focus, but not an area of prime attention itself. 

A third classification of CDMO has the ability, and importantly the cultural intent, to assist a client in process and analytical development, usually from a development-focused location, through commercialization, and then with continued, larger scale services, often from another location focused solely on GMP manufacturing.  A key point here, which is true throughout our industry, is that technology development and routine manufacturing are not easy bedfellows, and in the words of that song by The Offspring, we “gotta keep ‘em separated.” This need for separation comes from the cultural perspective on change (process development is all about iterative change, GMP manufacturing aims to tightly control change) and the need for and presence of scientific experts in the day to day.

It is clearly important therefore that a sponsor company, when seeking a CDMO partner, understands where their own program needs focus and whether that area of focus aligns with the CDMO’s internal interests and emphasis.  It’s this alignment, and the realistic clarity thereof, that’s crucial. It is also critical to assess the CDMO's capability in terms of standard processes and equipment for the specific product to be manufactured, as well as their provision of development services. Additionally, understanding the CDMO's market position, whether they prioritize seeking volume or service fees for development, can help sponsors make a more informed decision.

So how does a sponsor know if the CDMO is going to be the ideal partner? In the whirlwind of formulating agreements and timelines, it is important not to lose sight of the main goal: supply patients in need with high quality therapies. The razzle dazzle that comes with reporting to the public about upcoming production and securing additional funding can cause sponsors to miss the CDMO’s red flags. This means it is imperative to ask CDMOs the right questions, that will uncover the inner workings of the organization. The following questions are a good start to get the discussion going, with explanations as to what you should expect from a high-functioning CDMO.

1. Can you provide us with a breakdown of costs and fees for the project, and how you handle any potential changes or modifications?
   1. Another challenge in building a successful relationship with a CDMO is managing the timeline and cost of the project. Delays and cost overruns can quickly derail a startup's plans, so it is important for both parties to have a clear understanding of the project timeline and budget. Effective project management is essential, and sponsors must be proactive in communicating their needs and expectations to the CDMO.
2. Can you describe your quality control processes and how you ensure product quality and consistency?
3. What is your approach to communication and collaboration with clients during the development and manufacturing process?
4. Can you walk us through the timeline and milestones of the project, and how you manage and report progress to clients?
   1. These questions will highlight the CDMO’s quality culture mindset. Quality culture and transparency are crucial considerations when selecting a CDMO partner. Sponsors should evaluate the CDMO's willingness to discuss problems in real-time, their ability to admit challenges, and their procedures and technology to support collaboration on quality system elements such as changes to the process, deviations, CAPAs, and complaints. The CDMO should provide details of their approach, such as regular project meetings, project management tools, and transparent reporting of progress. Timely updates and transparency, on both sides, will only strengthen the relationship.
5. Can you provide references or case studies of similar projects you have successfully completed?
   1. The CDMO should highlight their achievements and demonstrate their ability to deliver projects on time. Be wary if they have a proven track record of delaying product disposition (i.e. the release/reject decision) since such a trend may indicate a tendency to start before they are truly ready and pay for this on the backend.
6. How do you handle unexpected issues or deviations during the development or manufacturing process?
   1. Listen and determine if the CDMO provides clear details of their approach to problem-solving and decision-making, such as their process for root cause analysis and their ability to implement corrective actions.
7. What is your policy regarding intellectual property and confidentiality, and how do you ensure protection of our proprietary information and technology?
   1. The CDMO should demonstrate their commitment to protecting their client's proprietary information and technology and provide details of their security measures to ensure data protection and confidentiality.
8. Can you walk us through your process for monitoring and controlling the manufacturing process?
   1. It is vital to the future of any early therapy that sponsors understand the manufacturing landscape at a CDMO. This question will uncover a CDMO’s approach to ensuring that the manufacturing process is running smoothly and meeting the desired quality standards. It will also reveal how the CDMO identifies and addresses any issues that arise during the manufacturing process. Startups, especially, may be navigating a complex regulatory landscape that they don’t fully understand, with strict guidelines and regulations governing every aspect of the product development and commercialization process. Having a CDMO that is well-versed in these regulations and working to continuously improve to meet the standards, is a big win.

Once a CDMO partner has been chosen, maintaining open communication throughout the entire process will lead to a fruitful relationship. Communication is the foundation, and the startup must ensure that they have a clear understanding of a CDMO's capabilities and limitations. It is essential to resist the temptation to hoard critical technical knowledge with the CDMO, as the value of sharing outweighs the risk of intellectual property dilution. Establishing these agreements and processes early on can take the decision load off a team dealing with a crisis and ensure a successful partnership with the CDMO.

 The CDMO, in turn, must be transparent about their processes and timelines, and work closely with the startup to develop a customized manufacturing plan that meets their specific needs.

Key Messages

It’s clear that CDMOs play a very important role in the delivery on the promise offered by Cell and Gene Therapies and that most sponsor companies will utilize the services of a CDMO at some point in the timeline of product development.  Success of the sponsor/CDMO relationship is heavily dependent on selecting the right partner in the first place, based on a clear understanding of what both companies need and bring to the table.  Asking the right questions and providing truthful, transparent answers will result in choosing the right partners.

Part two of this topic will cover what happens next – issues and advice for both sponsors and CDMOs in terms of operations, responsibilities, and behaviors. We will also cover essential responsibilities of the sponsor, in terms of batch release and overall quality oversight.