Contract manufacturing organizations provide industry expertise, and their facilities permit the production of biologics, especially by small- and mid-tier companies, that would otherwise not have the financial capability to produce on their own.

According to our 8th Annual Report and Survey of Biopharmaceutical Manufacturing, [1], as the industry matures, CMOs are being expected to resolve a growing list of problems and challenges for their clients. For example, over the past four years 32% more biopharmaceutical sponsors are seeing their CMOs ability to handle cross-contamination problems as a “very important” factor.

For eight years, we have measured how important clients and sponsors consider various factors when selecting a CMO, asking them to point to critical areas as “Important” or “Very Important”. We have found that, while some attitudes have changed quite significantly over the years, others have remained quite constant. This year, we evaluated the responses from 352 global biomanufacturing respondents against data from 2008, for issues considered “Very Important.” Of the 19 factors measured, ‘Effectively handle cross-contamination issues’ increased the most, by 32 percentage points. Following was ‘Protect intellectual property’ which rose by 26.7% points since 2008. This factor refers to biomanufacturers’ desire that their product-specific manufacturing operations be kept proprietary. This increase may be the result of a growing focus on outsourcing of operations. ‘Stick to a schedule’ was also not far behind, increasing by 23.3 points. This reflects a trend we have found most apparent in the past couple of years, whereby sponsors are demanding greater levels professionalism, performance and effectiveness in both managerial and technical areas from their outsourcing vendors.


Fig. 1: Trends in Critical Issues When Considering a CMO (Issues Indicated as ‘Very Important’)
Source: 8th Annual Report and Survey of Biopharmaceutical Manufacturing, April 2011,
BioPlan Associates, Inc.




Fig. 2: Selected Critical Issues when Considering Outsourcing BioManufacturing
to a Contract Manufacturing Org. (CMO) % Responding ‘Very Important’, 2006 to 2011.
Source: 8th Annual Report and Survey of Biopharmaceutical Manufacturing, April 2011,
BioPlan Associates, Inc.

Some categories have decreased in importance over the years, particularly those regarding capacity and production issues. ‘Have capacity enough to meet my sales demand’ fell 18.8 points from 2008, reflecting the global overcapacity of supply. In the same vein, ‘Offer a secure supply (Control of capacity)’ dropped 9.5 points, and ‘Have production platforms that are relevant to my product’ slimmed down by 6.6 points. Perennial contender ‘Comply with my company’s quality standards’ has remained the most steady issue, virtually unchanged with just a negligible 0.4 points increase in respondents considering it a critical issue over the past four years.

Are Sponsor/CMO relationships getting better?

Over the last five years we have found some of the top attributes have not shifted significantly. For example, ‘Establish a good working relationship’, is always a top contender that varies relatively little from year to year. The factor moved from the #4 spot in 2006 up to the #2 spot last year, and back down to the #6 spot this year, with 45.5% of respondents indicating this is a critical “Very Important” selection attribute.


Fig 3: Selected Critical Issues when Considering Outsourcing Biopharmaceutical
Manufacturing to a Contract Manufacturing Organization (CMO), 2011 % Responding "Very Important" & "Important".
Source: 8th Annual Report and Survey of Biopharmaceutical Manufacturing, April 2011,
BioPlan Associates, Inc.

The slow maturation of this industry is reflected in these data and suggests that customer service, and establishing good client-vendor relationships appear to have gotten slightly better over the last year. Maintaining good client-vendor relationships is increasing in importance to clients, and it is likely that poor communications between clients and vendors is a major factor in the persistent “working relationship” issues.

The current economic situation may have created a more collaborative vendor-client environment. However, some specific areas are slow to improve. For example, ‘Sticking to a schedule’ is another soft, client-relationship issue that has not appeared to be on the path to resolution, having almost doubled from about a quarter of respondents in 2008. This year, though the factor has improved somewhat, the percentage of respondents considering it a critical issue has hovered around 50% in recent years, putting it in the #4 spot.

The two other issues that we found grew the most from 2008 have also dropped in importance from last year. This year 58.8% of respondents considered ‘protect intellectual property’ a critical issue, compared to 60.0% in 2010. ‘Effectively handle cross-contamination issues’ took a larger drop, from 58.1% of respondents in 2010 to 52.3% this year. This suggests that while these issues have grown in significance over the years, they may be starting to improve.

In fact, when compared to 2010, almost all issues seem to have decreased in perceived importance. This may be the result of the economic situation or a general improvement in CMO management skills. The most notable shifts from last year for sponsors considering attributes as “Very important” are:

- Have capacity enough to meet my sales demand (down 26%)

- Have production platforms that are relevant to my product (down 13%)

- Provide superior technology transfer services (down 11%)

- Offer a secure supply (down 11%)

- Provide lead times sufficient to cover technology transfer (down 10%)

Of the 19 areas considered, the only attribute which has increased in perceived importance is ‘Have regulatory compliance expertise’ which grew from 41.9% of respondents in 2010 to 46.6% this year.

Today’s most widespread concerns

Looking solely at data from 2011, of those indicating an attribute was “Important” or “Very Important”, the number one issue, (when combining these two attributes) was, ‘Stick to a Schedule’ (with 93.2%). ‘Establish a good working relationship’ was second on the list, with 91% of respondents considering the issue “Important” or “Very important”. It is interesting to note, however, when we sort the data by “Very important” only, then the “Comply with my company’s quality standards” attribute beats out the schedule attribute by 10.2 percentage points. That is, scheduling is an important issue to almost 100% of biomanufacturers, but it’s a critical important issue to only 49%.

Contrary to anecdotal commentary from both CMOs and sponsors, a CMO’s location continues to show up on the survey as being relatively unimportant (only 17.1% of respondents indicating it is either “Important” or “Very Important”, but just 2.3% finding it the latter). This may be a function of the globalization of this industry (see BioPlan’s [2]), the off-shoring of greater numbers of successful production projects, and the degree of outsourcing-management expertise that sponsors are acquiring.

Tomorrow’s Outlook

Companies are increasingly considering outsourcing more complex production operations, not only during the development phases but also after commercialization. This is a long-term trend that is creating opportunities for CMOs with experience in regulatory areas, and those able to perform higher level technical operations. As the industry adopts project management processes and establishes the skills needed to manage external relationships, client-contractor relationships will continue to mature and become more complex. With these changes will come a more cooperative management and maintenance of outsourcing relationships, which will increase the ability to partner on technically complex projects. And as the use of outsourcing partners becomes more embedded into the strategy of companies, effective management of the contract by sponsors will become a more critical function.


1. 8th Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production:  A Survey of Biotherapeutic Developers and Contract Manufacturing Organizations, BioPlan Associates, April 2011, 490 pages.

2. See BioPlan’s Top 1000 Global Biopharmaceutical Facilities Index™, Accessed September 8, 2011

About the Author: 

Eric S. Langer is president and managing partner at BioPlan Associates, Inc., a biotechnology and life sciences marketing research and publishing firm established in Rockville, MD in 1989. He is editor of numerous studies, including “Biopharmaceutical Technology in China,” “Advances in Large-scale Biopharmaceutical Manufacturing”, and many other industry reports. 301-921-5979.

Survey Methodology: The 2011 eighth Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production in the series of annual evaluations by BioPlan Associates, Inc. yields a composite view and trend analysis from 352 responsible individuals at biopharmaceutical manufacturers and contract manufacturing organizations (CMOs) in 31 countries. The methodology also encompassed an additional 186 direct suppliers of materials, services and equipment to this industry. This year’s survey covers such issues as: new product needs, facility budget changes, current capacity, future capacity constraints, expansions, use of disposables, trends and budgets in disposables, trends in downstream purification, quality management and control, hiring issues, and employment. The quantitative trend analysis provides details and comparisons of production by biotherapeutic developers and CMOs. It also evaluates trends over time, and assesses differences in the world’s major markets in the U.S. and Europe.