Our Supplier Failed? Heck No, We Failed Our Supplier!
By Louis Garguilo, Chief Editor, Outsourced Pharma
Dan Marasco has excelled within Big Pharma organizations in packaging and other strategic areas of drug manufacturing, including outsourcing and procurement at Merck, BMS and Shire / Takeda.
Regarding working with external partners, creating leverage and building relationships, I ask him to envision a different situation – the tough row to hoe the start-up biotech has when attempting to work with the best CDMOs.
In fact, since his departure from Takeda (see part one), I wonder if he might be interested in “going small” in order to wield his experience at a biotech.
“I listen to the Mel Robbins podcast, which I highly recommend. She got me thinking during a recent episode to consider all possibilities. I don’t want to have any regrets when I’m 80 looking back.’”
Despite his Big Pharma pedigree, Marasco has had a taste of the small-developer outsourcing experience.
“At Shire,” he explains, "despite our billions in sales, and Shire being viewed then as the ‘poster child’ of external sourcing, we operated like a little island outsourcing nearly everything for the U.S. market."
He credits much of what he learned then about building relationships to a senior leader at Shire.
“We would be in various meetings, and someone would disparage a certain CDMO. But that particular leader would almost always be of the opinion that we could make the relationship work. He said situations ebb and flow, and no one is perfect, including us.”
Marasco relates this thinking to an organization outside our industry.
Some years ago, he says, Toyota had an issue involving unintended acceleration with certain models that led to a recall of millions of vehicles worldwide. It required months to diagnose and then solve the problem. It resulted in countless lost sales.
While some insiders at Takeda said, ‘Our supplier totally failed us,’ Toyota’s CEO replied publicly, ‘If our supplier fails, we have failed them.’
Marasco wonders whether we have such fortitude in our industry.
“If something of that magnitude happened in pharma, someone would be ‘burning’ that CMO at the stake.”
Circumstances, of course, vary, but Marasco's is an apt analogy to examine our own mindsets, and help us avoid defaulting to fault-finding attitudes.
Adjusting Our Reactions
We are talking about an adjusted reaction, and says Marasco. “This goes to my own servant leadership style. I’m not the boss, they are the boss.”
Yes, leaders and organizations at times have to look critically at situations and make final pronouncements on external partners, Marasco says, “but the hope is it never gets to that.”
“My style of working with the supplier is to try and remove whatever the obstacles are on both sides, and look for ways to positively move forward.
“How can we be better so that we can win together? That's the best way."
If you as a sponsor has significant leverage with a CDMO because you offer a significant spend, you may have times where you need play that card. However, Marasco says even then you shouldn't necessarily carry a combative attitude.
“That leverage card should stay in your back pocket," he advises. "Play it only when you absolutely must, and even then, look for some mutual solution.”
A Failure Of Leadership
There are CDMOs where it turns out they are simply difficult to work with, for a number of reasons.
Whatever the cause, says Marasco, maintaining your servant-leader and adjusted reactions may work to break down barriers and get everyone going in the same direction.
“A director early in my career – who I worked under in procurement, sterile filling and again later directly supported in external manufacturing – taught me it's always best to be transparent with our external partners, collaborate to find the win-wins, and set a clear sourcing strategy and follow it.
"If you don’t do that consistently, soon few CDMOs are going to want to work with you. Or if they do, they will make you pay for it.”
Along with transparency comes clear and quick communication commitments.
When critical impacts arise, reaching out directly to project managers and other contacts at the CDMO should be reflexive. And if necessary, choose to meet face-to-face.
“I've always maintained the posture that CDMOs are our advocates, and we must be theirs in return," Marasco says emphasizing the second part.
“Unfortunately, there are still players out there who keep things close to the vest, and often the CDMOs end up getting caught off guard, or get the rug pulled out from under them.
“There were times when decisions were made way above me in the organization. I’ve had that awful feeling delivering a message such as, ‘Our $15-million-a-year product, running every day in your shop, will now be taken internally because we have a capacity issue with one of our plants.'”
Situations arise, says Marasco, but if that possibility had never been discussed previously with the CDMO, and some form of restitution is not presented, then the situation is "a critical failing of your supplier."
"And of outsourcing leadership."
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Here's part one our conversation with Dan Marasco.