Guest Column | January 28, 2020

The 4 Most Important Elements Of A Successful Sponsor-CDMO Relationship

By Christopher Ohms, director, supply chain, Rigel Pharmaceuticals Inc.

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When a sponsor contracts with a manufacturing organization to execute a scope of work or series of tasks on its behalf, the sponsor takes on a level of oversight different from that within its own organization. The general routines and activities centered around how to conduct an effective meeting, defining and tracking action items, and project management principles are implemented. However, there are a series of understated considerations to be managed while working with a CMO. Some of the more impactful elements between sponsor and CMO include culture, communication, respect, and metrics; how these are managed is a blend of science and art. This article will highlight how these topics could play an important role in a successful relationship between the sponsor and the CMO.

Culture

Do not assume the sponsor and the CMO have the same cultural values. It is important to try to understand the cultural similarities and differences between the sponsor and the CMO. Cultural values could include the standards within each company as well as regional philosophies. The world is a diverse place, and cultural values impact the people and the value system at the CMO.  Sometimes, the cultural values of the sponsor and CMO are the same, but when they are vastly different, significant challenges in understanding and meeting deliverables may occur and impede progress. If these differences are not recognized early, frustration and misaligned expectations can lead to project delays and deliverables. 

Relatedly, a CMO with locations in Africa, China, the United States, the United Kingdom, and Italy will have different styles of work at each location. They may appear to be the same company and share the same logo and executive leadership, but at the site level you should expect differences. With these differences, you need to determine what tools and techniques need to be used to maximize the intended outcomes required to meet the scope, budget, and time of the work. The effort made early in the process to align expectations and understanding will often pay back in dividends to the project teams’ work output. Culture alignment, whether corporate or geographical, begins with communication.

Communication

A key criterion of any successful relationship is effective communication. Effective communication is not relaying a series of daily emails full of segmented details, nor is it making a multitude of calls to the CMO. Communications should be well structured and defined. Develop an internal governance or communication plan before you socialize it with the CMO, and seek the same from the CMO. This plan should include key points of contact, communication ground rules or “do’s and don’ts,” and backup names/numbers as needed. Establishing the ground rules early will lead to effective communication between you and the CMO to drive results and outcomes. Like any plan, the approach and content are subject to change as the relationship changes.

All too often, delays in meeting deliverables are a direct result of poor communication and the lack of tools to maintain inputs/outputs driving communication. In one extreme case, a person may send an extensive email to one group or individual, and the importance of the message gets lost in a sea of subsequent email traffic. On the other side, an individual will make a series of private calls to message a request or tender an update. Think before an action is taken; evaluate the mode of communication to ensure the message is understood and actionable and directed to the correct team members. Ensure the content of the communication remains rooted in the issues, not an individual or personal perspective. In other words, be respectful.

Respect

Collaborations are rooted in mutual respect. Too often, a sponsor or CMO will act inappropriately and say or do something that leaves long-lasting negative effects. Some of these behaviors are based on the magnitude of money being exchanged between the two parties. In the extreme case, a sponsor may treat a CMO like a lower-status party, and the sponsor may feel emboldened to act in strong fashion that is off-putting to the CMO. This sort of behavior should be limited. In parallel fashion, a CMO may not respond to a sponsor that is spending less than another client; that is, the more lucrative client gets more attention. If there is not mutual respect, the relationship will suffer, and the business will be impacted. 

If companies treat their counterparts respectfully, regardless of the money being exchanged, each will generally get productive results. When real issues come up, each will generally have a more favorable sense of collaboration, leading to a better business relationship. Over time, more and more work is being added to a CMO’s queue, while its resources remain more or less the same. This reality poses challenges at the operational level to keep pace with the demand. Metrics and key performance indicators (KPIs) are a scalable way to help identify areas most impacted by the compression of work load and capacity at the CMO.

Metrics And Key Performance Indicators

Data helps drive decisions and an assessment of performance. If properly defined, metrics and KPIs can help to manage the relationship between a CMO and the sponsor. Not every relationship needs metrics and KPIs. If the relationship is one destined to continue over a prolonged period and involve myriad activities, metrics and KPIs will help the relationship. As data is gathered, it is vital to maintain transparency of the data between the parties. Some companies develop visual management tools and display metrics in common work areas so all levels within the organization can participate in the solutions to improve.

One of the most valuable reasons to collect data and information is to optimize the activities between the companies and make continuous improvements. Sometimes these efforts are used for punitive purposes. If the intent is to be punitive, the relationship is likely already plagued with other significant issues that need to be addressed, or the relationship needs to end.

How data is collected, organized, and interpreted is to be considered in the management process. All too often, one party or the other uses the data and indicators to bias a perspective on the health of the relationship. In the best case, metrics are shared well before they are socialized to senior leadership or in a broad audience. Independent of the results and interpretation of the data, the act of alignment between the sponsor and the CMO is an effort in collaboration.

There should be agreement on when metrics and KPIs are to be reviewed and by whom. Here again, unless they are well defined, clear, and messaged properly, incredible subjectivity can be infused and incorrect perceptions made based upon the metrics and KPIs.

Conclusion

In summary, managing a CMO relationship can be challenging, and it is a mix of science and art. But if you consider the elements of culture, communication, respect, and metrics/KPIs as guide posts to help you frame the underpinnings of the relationship, you will have a good foundation on which to build. 

About The Author:

ChristopherChristopher Ohms is a San Francisco Bay Area native and serves as director of supply chain at Rigel Pharmaceuticals. Prior to joining Rigel, Ohms held positions at Gilead Sciences, Patheon, Stanford School of Medicine, Pain Therapeutics, and ALZA. His 27-year career in the medical and pharmaceutical settings has been in quality, project management, research, development, commercial operations, manufacturing, packaging and labeling, supply chain, sales and operations planning, and global clinical/commercial contracted relationships and oversight. Ohms has co-authored eight patents and holds a B.S. in biology and an M.A. in English literature.