Rocketing Expectations For CDMOs
By Louis Garguilo, Chief Editor, Outsourced Pharma
When Rocket Pharma formed in July 2015 it had a handful of employees; today it’s grown to about 250, and the company continues to actively hire. The company went public in 2018, and as we detailed in part one, employed a fully outsourced strategy until it decided to build its own facility to grow its AAV-directed pipeline.
Among those employees, I ask Shah, how many are devoted to CMC activities performed externally.
As much as the number, he counters, it’s the quality of person that matters to an outsourcing gene-therapy company, or perhaps especially, one with a hybrid model.
“Kinnari and Raj did a superb job strategically overseeing CMC and managing our CDMO relationships – on top of their respective day jobs – but we reached the stage in our growth where we needed to bring in a dedicated Chief Technical Officer,” explains Shah.
Since last summer, these critical activities have been led by “the fabulous supervision and leadership of Chief Technical Officer, Mayo Pujols,” says Shah Pujols was CEO of Andelyn Biosciences, where he helped create a full-service gene therapy CDMO, and among others, has held key positions at Novartis, Celgene, and Merck.
Pujols runs the internal manufacturing group and the building out of the new facility, as well as overseeing outsourcing activities.
“We are in as capable of hands as I could have ever hoped for,” says Shah. “The CMC group is a hybrid, too. A number of people are fully dedicated to helping oversee, integrate, and work collaboratively with the CDMOs.”
“However,” he adds, “we do a lot of validation work and release testing internally, and we're building out capabilities, so in most cases we don't have that clear separation of internal-versus- external expert. Ultimately, we may get to a place where we have a group fully dedicated to working with external partners, but not yet.”
As I often do during interviews for my publication, Outsourced Pharma, I ask Shah how directly a biotech CEO needs to get involved with service providers, beyond hiring the best professionals to work this part of the organization’s operations.
“Again, I was lucky to have spent time at Novartis, where they have one of the best CMC groups in the world,” he replies. “I spent time understanding what's important, and what's not.”
In general, biotech executives “have to obsess” about CMC, CDMOs, and the stages of development. “I’d say the first six months of my job as CEO of Rocket was focused on getting CMC right. If I were to do this all over again, I'd do the same thing.”
Shah attributes this early focus to helping Rocket start its clinical trials with a near-commercial process in place from the first patient treated. He believes too few gene- and cell-therapy companies have learned you can't have comparability and other discussions halfway through your trial.
“Having learned from Novartis to be highly involved was good for me as a CEO, and for our entire organization.”
An Outsourcing Trajectory
Shah believes that even for those newly emerging biopharma organizations with various operating models, strategies, and novel therapies, the traditional CDMO model remains “highly leveraged around those CDMO’s creating a revenue stream with customers vying for and reserving development and production slots.”
“I understand it's a commercial business where you have to worry about the bottom and the top lines. I totally respect that,” he says. All drug and therapy sponsors should, too.
Within that CDMO model, though, a number of variables have to fall perfectly in line to provide the optimal opportunities for a customer’s program success.
If CDMOs focus on building strong relationships with pipeline developers; if they are hands-on with process development; if they continue to improve cost-of-goods together with their partners; and finally, if they come to a full understanding around all quality needs and practices, then these factors can help both sides feel like incentives are in fact aligned.
What CDMOs cannot do, for example, is pursue process development with the aim of sustaining workflow and higher revenue. There must be “real incentive to help customers innovate and reduce costs,” which, ironically, might in some cases result in more process development, but for the right reasons.
Shah says the CDMO mindset of today should evolve to “an integration with sponsors in such a way that sponsors actually don't need to build our own capabilities.”
He’d like to see more of that type of enlightened partnership, and maybe that includes some types of joint-venture or equity exchange. He’s not inviting this specifically for Rocket, although, he says, the company did entertain such thoughts previously.
“I look forward to a world of gene therapy where the CDMO and biotech models are increasingly integrated,” says Shah, but adds, “I don't know exactly how that happens. I do feel Rocket is in a position to be part of that solution, whatever it is.”
He ends by offering up a blue-sky question for the entire industry:
“How do we integrate further so we can work together earlier and more effectively?”
Answering that, he says, is the only way we can successfully get more therapies out to hundreds and then thousands of patients. And, we might add, how our entire industry can reach new horizons.