The questions were the news.
They were specified by Bristol-Myers Squibb’s Christopher Sinko, SVP and Head of Product Development. He listed them under the headline: An Evolution in “Make vs. Buy Thinking.”
But the questions were also old school to Outsourced Pharma readers.
They remain cemented within the broadening evolution impacting development and manufacturing outsourcing dynamics – new therapies, modalities and technologies, the need for optimal flexibility at facilities, and the growing centricity of the patient.
You have been accurately guided by timeless questions to ask (a) before deciding to outsource, and then (b) should you decide, to help in the selection of your CDMOs and guiding those resultant relationships.
These questions were introduced anew by Sinko at the recent DCAT Week in Manhattan, hosted annually be the Drug, Chemical & Associated Technologies Association.
I rearranged them a bit, and added some of my own analysis.
10 Questions For Buy vs. Make
1. Where in the life cycle are your products?
With the advent of the virtual biotech, we might be talking more often about a single product and thus one life cycle. But whether one or many, says Sinko, most all development and manufacturing networks are “a mixture of things that are internal or external, so entail a number of make versus buy decisions along the way.”
Successful drug sponsors must ask detailed life-cycle questions regarding: existing drug products, developing multiple lead candidates, potential follow-up products and follow-up indications, needed new technologies, going from a stable agent to a combination product, various delivery devices, and so on.
Overlaying those decisions, leaders must clarify the “life stage” of the entire company, current operating strategy, and thoughts for the future of the business.
2. What is the long-term forecast for our specific products and technologies?
Take no solace in the truism: The only thing certain about our product forecast is that it will be wrong. In a world of “data, data everywhere,” your continuous questioning, analyzing and interpreting of product and supply-chain needs will help you more accurately forecast, even long term. Keep collecting, updating, and questioning.
3. What is the extended R&D pipeline and commercial portfolio?
Directly related to the question above, Sinko focuses here on the more established biopharma’s complete pipeline, and asks: What does that pipeline and commercial portfolio look like exactly?
“Can we be better at predicting pipelines, say five or ten years out?” he asks. “What platforms are we developing for future manufacturing? For new cell or gene therapies, this may be harder to predict, “but even today a lot of development and manufacturing is done on tried-and-true or similar types of equipment,” allowing us to in fact forecast directionally, and manage better for the future.
4. Is the technology core to the company?
At a seemingly ever-accelerating pace, technology provides us opportunities to advance drug research, development, manufacturing, delivery, and distribution.
But what technology components are really core to your product(s), or to your strategy as an organization? “It may not be a matter of complexity at all, but of strategic competency in certain, even more basic technologies,” says Sinko. “Should you invest to build that technology into your own facilities?” Answers to these questions will help determine the future direction of your organization.
5. What are your core capabilities?
This question may return answers surprisingly different than those to the question directly above.
I’ve written about an extreme example of this in these pages: Younger biopharma organizations might conclude their core capability is the ability to effectively manage external partners! It’s an all “buy” model for them.
But even for (much) more established drug development and manufacturing organizations, core technologies and core capabilities should be looked at separately, before a final, coming together of “directional decisions” for your organization’s strengths and paths can take place.
6. Do you have the capabilities already in house?
How many readers have worked at biopharmaceutical organizations where post-decision making to outsource, they’ve uncovered spare internal capacity that could have been utilized? Or located knowledgeable internal staff after the fact, perhaps “hiding” in a different department, on a different continent, or at a sub-company?
The motto of this question: Look long and hard to uncover whether in fact the most capable – and available – capabilities for what you need aren’t “within your sites.”
Now we turn directly to the CDMOs as potential partners …
7. Are the CDMOs strong at the technology and capabilities you need?
The truthful answers to this question sit atop the results of dozens (hundreds?) of sub-questions. And these questions can be asked of other biopharma who have worked with the CDMO as well.
But how do you get to real answers to these questions? One humble suggestion is to keep reading Outsourced Pharma, where we frequently offer actionable advice on the subject.
8. Is the CDMO’s culture, related to patientcentricity, strategy, quality, cost, supply, compliance, aligned with your internal expectations?
A lot of parts in this Sinko question. And that’s because uncovering the practiced truths of supplier culture is among the hardest things to do. Here’s Sinko:
“The most important thing for me is a patient-centric culture at the CDMO. With a patient-centric culture in common, two companies partner in terms of how they deal with and think about the patient, and why they are really in this business.”
9. Does geography matter (proximity to patients, localization)?
The last two decades we have effectively shrunk the geography of outsourcing. You can get a better price or other advantage in China? Then opt for China. The world is your outsourcing stage.
Conversely, now more than ever you may need to be close to today’s fractured markets, and to individual patient populations.
With so much outsourcing going on, you may also want to be geographically close to your CDMO for convenience, speed, to save on travel and time zones, and to forge more face-to-face relationships.
All said and done, geography may be why you decide to build exactly where you need to be – rather than outsource to a less optimal location.
10. What are the financials, investment, and capital?
Remember the “Got Milk?” advertising campaign by the dairy industry? Well, for biopharma (of all sizes), the fundamental question is: “Got Money?”
If you don’t, that sets you down a certain path to raising investments and capital. And outsourcing can be a way to best leverage those first dollars.
If you do, you might decide building is, in the long run, the smart accounting practice for you, your investors and shareholders.
In either case – the haves or the have nots – the ebbing and flowing of your financial situation should consistently send you back around to the other nine questions on our list.
The make vs. buy cycle lives on … as long as you keep asking the right questions.