A recent survey conducted by the Economist Intelligence Unit (EIU) explored biopharma’s growth strategies and how companies plan to manage risk while expanding their drug pipeline and geographical footprint. To challenge biopharma to go beyond barriers when entering emerging markets, there is a need for a new approach to partnerships in this complex, ever-changing environment.
Earlier this month, Guillaume Plane, Global Development and Marketing Manager, Biodevelopment Services at Brand Name, presented a webinar, “Strategies for Mitigating Risk When Entering Emerging Markets.” During the presentation, Guillaume interacted with attendees through two polling questions and a Q&A session. This article provides highlights from these interactive sessions.
Poll Question #1: Roughly half of the EIU survey respondents stated that they planned to add production and development capacity in Latin America and in the Middle East and Africa. What regions are you planning to expand your business (Select all that apply)?
Webinar Poll Results (26 respondents)
EIU Survey Results (254 respondents)
Guillaume Plane: All of these regions are of interest for us from a business standpoint. It is clear that many companies today are looking for new ways to expand into emerging countries – the highest proportion of the webinar viewers stated that they were planning to expand into Asia and Australia, and 14% are looking to enter the Middle East and Africa, which reflects the trend in the EIU survey.
While I am happy to see that companies are considering these new areas, this kind of expansion comes with a lot of risk. Questions come up such as: do they understand the way of life in this country, how will the local population cure people when they are sick, and is there a language barrier?
In addition, companies have to consider the viability and interest in this market -- are people in these markets able to pay for the drugs that will be developed? Many drugs, especially mAbs and cell therapies, are very expensive.
There is also concern about the ability to access and retain local labor. When a company moves into a new country and wants to produce mAbs, will they be able to find the skilled labor they need to work in the biopharm industry? When you are building a new facility you will have to manage people, understand the way they live and their culture. This can be a new set of challenges for a company to face and overcome.
Poll Question #2: What are your company's main strategies for manufacturing new drugs and therapy products (Select all that apply)?
GP: The majority of the webinar audience said that their strategy would involve partnering with contract manufacturing organizations (CMOs) or other skilled organizations. Partnering is a major trend based on the poll of our attendees and is also very much in line with the results from the EIU survey.
Webinar Poll Results (31 respondents)
EIU Survey Results (254 respondents)
We consider outsourcing during the early stage of drug development as one of the best ways to mitigate risk. In addition, it is very important to not only have a close relationship with your outsource organization but also have good project management, with both sides having a clear view of what needs to be done and where you will go next.
At the late stage of drug development, once you know there is a good chance your drug product will get to market, it makes sense to then internalize your process in order to preserve your margins.
In addition to our poll, webinar attendees were able to ask Guillaume some of their own questions. Below are some of the highlights.
With regard to tech transfer, what is the most time consuming step?
GP: Tech transfer is very difficult to manage. It takes time and is very complex -- it's not just sending a recipe or SOPs to a new organization. We have found that one of the most time consuming steps is the time that is wasted when there is a lack of communication between the two organizations. If they do not use the same vocabulary or have the same habits, this becomes very complex to manage.
A common mistake companies make when doing tech transfer to an emerging country is not working with a trusted partner. Often companies think the process will be more efficient if they just do it on their own. However, tech transfer does not consist of simply sending a set of documents between two companies, but rather having two organizations work together to ensure the process transitions seamlessly.
Can you shed some light on single-use technologies and how they are adopted in today's environment?
GP: Single-use technologies are well adapted to the biopharma environment. This market has seen incredible growth over the last 5-10 years and the current adoption of these technologies is quite high. You now see most, if not all, facilities are using single-use technologies. When companies start building a new facility, they almost never consider stainless steel, unless it is required for their process. However, even this will change in the future.
The main benefit of the adaption of single-use technologies is that you can produce several drugs in the same facility. The production line is changed after each run, which also means you can avoid cross contamination. But the main aspect is that you can produce many products in the same facility, thus helping to reduce your capital investment.
If you are building a facility in an emerging market, do you need to follow the regulatory rules of that country as well as the US FDA?
GP: If you are looking to supply the drug product only to the local market, then you don't need US FDA approval. However, if you want to use your product for local and US markets, then it is required that you not only obtain FDA approval, but also be compliant with FDA rules as well as the regulatory requirements of emerging markets. The best approach is to follow ICH guidelines, which are common requirements followed by most countries. It is important to note that you must still consider local rules and FDA regulations, as there might be specific adaptations requirements if you want to distribute globally.
What are your thoughts on IP protection and the dilution of global facility expertise into multiple small markets?
GP: IP protection is the main barrier to entry if you want to protect your business, and it's really important as not all countries have strong IP rules.
In emerging countries IP is critical, but there are also other barriers to entry that should be considered. If you want to go to market where the biopharma industry is not yet well developed, you can benefit from partnering with an expert in that area to help you develop your product, set up your process and train the local population specifically for working in the biopharma industry. Finding a way to retain resources is a barrier to entry when there is a lack of trained people in the region. Forming exclusive partnerships with key providers is another way to overcome this challenge.