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32 Pharmaceutical Technology ® Bio/Pharma Outsourcing Innovation eBook February 2024 PharmTech.com Page He ader _ customers. Because of supply chain disruptions of the last few years, bio/pharma companies are now reser ving and even double-book ing considerable partnerships with contract manufacturers. Astra- Zeneca, Moderna, and Pfizer have all penned part- nerships wit h multiple CDMOs, including Lonza, Catalent (under Novo Holdings ownership, subject to transaction approvals [1]), and Emergent BioSolu- tions. CDMOs are now adjusting their business mod- els through internal investments and strategic M&A [merger and acquisition] initiatives to keep up with demand for expanded services from multiple custom- ers. Plants are expanding—Cambrex and Samsung Biologics have all announced or started major expan- sions of manufacturing plants (2,3). One unexpected trend is the emergence of new CMDOs in a space that is witnessing [much] M&A activity. Lifera was launched last June by the Public Investment Fund in Saudi Arabia to boost [that] na- tion's biopharma industry (4), while eXmoor pharma completed a $35 million Series A financing round in a quest to become a full-service CGT CDMO (5). In the advanced therapies space especially, there's a huge competition for established outsourcing companies, let alone start-up CMDOs. But the market outlook for 2024 is cautiously optimistic, with some hopeful about moving on from a few years of stagnant growth. So, it will remain to be seen how new CDMOs/CMOs establish themselves in the last half of this decade. PharmTech: Are small and medium-sized compa- nies leaning more heavily on outsourcing? Informa: Start-ups and smaller biotech/biopharma companies may not have the resources or technical expertise to develop and manufacture complex bio- pharmaceuticals in-house, so there is definitely a tar- get audience for outsourcing partners to establish a working agreement with these companies. However, established pharma/biopharma companies are also leaning on outsourcing for niche products that re- quire specialized manufacturing processes or facil- ities. Innovations PharmTech: What innovations—new services, spe- cialized handling, spoke and hub based—are you seeing? Informa: Supply chain digitalization with genera- tive artificial intelligence (AI), blockchain, and cloud computing are being adopted more and more to bol- ster supply chain resiliency. In the 2023 CPHI Annual Report, in which 250 executives across bio/pharma were surveyed, over half described the routine use of AI in drug discovery by 2026. Nearly 65% of those surveyed also predicted FDA approval of a drug dis- covered by AI within, at the most, five years. This is already in the works—in early 2023, an experimen- tal psoriasis drug delivered a compound discovered by AI in six months and was progressing through to final clinical trial stages (6). With supply chains being increasingly politicized as well, companies are also expanding their manu- facturing capabilities to provide local production of bio/pharmaceuticals, with growing manufacturing markets in Latin America and MEA [Middle East and Africa]. Contract manufacturing is thus becoming more globalized. References 1. Novo Holdings. Novo Holdings to Acquire Catalent. Press Release, Feb. 5, 2024. 2. Cambrex. Cambrex Completes $38 Million Capac- ity Expansion in High Point, North Carolina. Press Release, Oct. 2, 2023. 3. Samsung Biologics. Samsung Biologics Accelerates Timeline of New Fifth Plant to Be Operational by April 2025. Press Release, June 6, 2023. 4. Public Investment Fund. PIF Makes Major Health Sector Investment with the Establishment of "Lif- era", a Pharmaceutical Manufacturing Company. Press Release, June 18, 2023. 5. eXmoor pharma. eXmoor pharma Completes $35 Million Series A to Expand Cell and Gene Therapy Manufacturing Capabilities. Press Release, May 30, 2023. 6. Insilico Medicine. First Drug Discovered and De- signed with Generative AI Enters Phase II Trials, with First Patients Dosed. Press Release, June 27, 2023. ■