Services to Pharma Companies

External Manufacturing Network Optimization

CDMO Evaluation System

CDMO Identification and Assessment

Request for Quotation Management

Pricing Benchmarking of Outsourced Products

CDMO Consolidation

Contract Review and Negotiation Support

External Manufacturing Network Optimization

Most of the Pharma companies with mid-sized or large product portfolios, with or without their own manufacturing sites, cooperate with many suppliers being CDMOs or other pharma companies that out license their products and keep the production for their customers in house.

As Pharma companies grow, they gradually introduce / acquire / in license products that are produced in different suppliers. Few years later, they come up with a product portfolio scattered to a big number of suppliers not necessarily selected by the Pharma company.

Our own research has shown that Pharma companies with more than 40 products in their portfolio, allocate to each supplier between 1-3 products.

The low number of products per supplier may limit the importance that the suppliers place to the Pharma company, increase difficulty and complexity in managing the supplier base and limit its the negotiation power.

CDMO Evaluation System

We support our customers in establishing an evaluation system, based on its outsourcing strategy, that examines several important parameters, on top of the ones usually used, like customer focus, meeting expectations, strategic match, long / short term approach, future sustainability

After establishing the evaluation system we can run the process and categorize suppliers into different groups:

  • Preferred, minor improvements needed
  • Improvements needed
  • High risk, need for relocation

CDMO Identification and Assessment

Based on required technologies and Customer’s Outsourcing Strategy we identify the appropriate CDMOs with good technological compatibility but also with good strategic match

This is managed through our broad business network and our European CMOs database which includes more than 320 CMOs with details on their technical capabilities

Depending on the difficulty of the specific product technology, a number of CDMOs are selected and contacted with a project brief asking to confirm capability and interest in the project.

Suppliers’ replies, their special capabilities and our comments per supplier are communicated to the customer.

Request for Quotation Management

We take over, on behalf of our customer, the overall RFQ process for a product or package of products. The process include:

  • Support to the customer for communication package preparation
  • Quotation template preparation
  • CDA signing with the selected suppliers
  • Communication with suppliers for quotation preparation
  • Clarifications with suppliers on their offers
  • First level of offer negotiation

We deliver to the customer:

  • Offers summary and comparison
  • Short description per supplier
  • Suppliers’ evaluation and ranking based on two sets of parameters, one set with Supply criteria and one set with Customer Focus / Risk criteria
  • Conclusion and our Recommendation

Pricing Benchmarking of Outsourced Products

Benchmarking is conducted towards market average, in different levels: General per product technology, Specific, Supplier type, alternative supplier availability, manufacturing site location.

The deliverables include products categorization in “expensive” / “could be lower” / average / good price product, estimation of the overall cost reduction opportunity and estimation of the cost reduction opportunity per product. For the first two categories profitability improvement plan could be proposed. Business case is presented for a potential transfer out by conducting cost / benefit analysis.

CDMO Consolidation

Best results in outsourcing are coming from a balanced CDMO portfolio with a manageable number of suppliers that meet customers’ expectations.

We initially study the whole portfolio, benchmark product prices, define the beneficial changes after conducting cost-benefit analysis and deliver a detailed consolidation plan with appropriate phasing.

Contractual obligations and organization capacity for supporting transfers are also taken into consideration.

Furthermore, we manage the whole project implementation until decided changes are in place.

Contract Review and Negotiation Support

Having dealt with a big number of Agreements with different magnitude companies and models and understanding the peculiarities of the CDMO environment we can advise on market practices and business clauses suitable to your business and strategy.

We review the standard contract template and propose modifications and clauses that safeguard the business based on industry standards. We also support in contract negotiation by consulting our customers as contract discussions progress.