Biopharma Gets Back to “New Normal” Business

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As 2020 dawned, the bio/pharma industry faced major challenges. Drug pricing was expected to be a hot-button issue in the presidential election. Calls to bring drug substance and product manufacturing back to the United States intensified as global competition heated up. And some companies faced ethical questions about their roles in the opioid epidemic.

Digital technology was being adopted across the development and manufacturing continuum, from artificial intelligence for drug discovery and design, to digital simulations and analytics for manufacturing, to smartphone apps to track patients in clinical trials and monitor their adherence to medication regimens. Growth potential for personalized medicine led to a surge in company and facility acquisitions for the development and manufacture of cell and gene therapies.

Early in 2020, however, the SARS-CoV-2 virus erupted worldwide, disrupting the “normal” routine of bio/pharma. For the rest of the year, efforts to respond to the pandemic overshadowed many aspects of development, manufacturing, and quality compliance.

Nearly half (48.1%) of the respondents to a December 2020 BioPharm International survey said that their organizations had experienced disruptions in the supply of materials or equipment as a result of the pandemic. More than 43% saw work schedules or production modified to accommodate social distancing. One-quarter reported staff shortages due to worker illnesses or quarantines. Respondents also noted delays or suspensions of clinical trials (21.2%); disruptions in regulatory compliance (18.6%); and shutdowns or suspensions of development or manufacturing operations (17.4%) (1).

Intense efforts by bio/pharma company research, development, and manufacturing teams to battle the pandemic began to show results as 2020 drew to a close, with one approved treatment (remdesivir), two Emergency Use Authorizations (EUAs) for monoclonal antibody treatments (from Regeneron and Eli Lily), and vaccines from Pfizer-BioNTech and Moderna heading to patients under EUA.

Meanwhile, drug researchers continued their work and,despite some disruptions to original pipeline development plans, concluded a modestly successful year with 49 approvals for new therapies from FDA’s Center for Drug Evaluation and Research as of Dec. 15, 2020, which surpassed the total for 2019 (2).

Delivering billions of COVID-19 vaccine doses and treatments to combat the effects of the virus will top bio/pharma’s agenda for 2021. At the same time, drug companies will be pressed to produce sufficient supplies of cost-effective generic and innovator drugs for a range of conditions.

The industry will also be challenged by global economic volatility, a new US presidential administration, and supply chain uncertainty. Lessons learned from the pandemic, however, offer new ways for bio/pharma companies to develop and bring drugs to market.

Great expectations

Pharmaceutical company executives surveyed in March–April 2020 by the Deloitte Center for Health Solutions predicted an acceleration in research and manufacturing of pandemic drugs and expect drug prices to again be a hot topic. The executives also plan increased investment in digital technologies across therapeutic areas and functions to improve the R&D process and safety, with an eye on cybersecurity threats (3).

Respondents to the BioPharm International survey were upbeat about business prospects for 2021. Almost two-thirds (64.3%) expected their companies’ businesses to improve, up from 52.2% in the 2020 survey; only 14.7% predicted a decline for 2021. They were even more optimistic about the bio/pharma industry as a whole, with 78.3% projecting that overall business will improve in 2021, compared with 66.1% in 2020; only 7% expect a decline in business in 2021 (1,4).

Supply chain woes

The dangers of sourcing crucial supplies from a single region surfaced as the pandemic first unfolded. The initial outbreak of infections and subsequent business disruptions in China resulted in shortages of anti-infective drugs, sedatives, analgesic medicines, and other essential generic drugs. Other shortages occurred for drugs previously approved for other conditions, which were investigated as potential treatments for COVID-19.

Currently, approximately 60–65% of global API production is based in Asia, primarily in China and India, explains Unmesh Lal, industry principal for transformational health with Frost & Sullivan. Another 24–27% of production is in Europe, with only 3–5% manufactured in the United States and 5–9% in the rest of the world. This huge discrepancy, he says. has made many countries too dependent on China for essential APIs.

“This is where we saw a significant demand in the short term,” says Lal. Although the pandemic caused a brief disruption and reduction in overall bio/pharma manufacturing capacity at certain sites, most production sites were quickly restored to full capacity by the end of the year, he says.

Bringing R&D back

The pandemic had a broad impact on other aspects of bio/pharma development and manufacturing. To meet the increased demand for pandemic-related treatments and vaccines, manufacturing of COVID-19 vaccines and therapeutics was prioritized, say Lal, impacting clinical pipelines, delaying clinical trials, and putting development projects on hold.

The industry also saw significant disruption in early phase clinical trials that were yet to be initiated, a direct outcome of patient recruitment and capacity challenges during the pandemic. At the peak of the pandemic, there was a 33% disruption of ongoing clinical trials, according to Frost & Sullivan data, significantly impacting small and mid-sized biotech companies, Lal says.

Sites operated by larger contract research organizations (CROs) have resumed studies, Lal says. By employing newer clinical trial models, using virtual trial tools, and working collaboratively with the regulatory protocols devised in light of COVID-19, US and European CROs were able to recover faster than rest-of-the world markets, he notes.

One sign of growth resulting from the pandemic is that CROs are enhancing bioanalytical testing, safety, and toxicology services to meet the demands of early-stage COVID-19 trials clinical trials, Lal says.

Government investments in the development of COVID-19 vaccines and therapies, such as Operation Warp Speed in the US, have provided funding for some companies. Frost & Sullivan is monitoring R&D activity and government investment to see whether the surge from 2020 will carry over into 2021, especially for therapeutics. Lal expects bio/pharma companies to reduce investments in R&D for non-pandemic therapies by 2–3% in 2021, as they focus on COVID-19 treatments.

COVID-19 has also affected investments in bio/pharma development, beyond the government financing of public-private partnerships to advance vaccine and COVID-19 therapy research and development, according to analysts at Evaluate Pharma. However, biotech investments recovered quickly from initial market drops in the first quarter of 2020, and initial public offerings rebounded in the second quarter, the analysts say (5).

Many emerging bio/pharma companies lack the internal development and manufacturing capacity to move their drug candidates forward and have turned to contract development and manufacturing organizations (CDMOs) for these functions. As a result, CDMOs were busier than ever in 2020 and will get even busier as bio/pharma companies look to build redundancy in their supply chains, according to the market research firm, GlobalData. “Pharma companies may try to reduce their supply chain risks by deliberately building redundancies—such as through using multiple suppliers and stockpiling. In the future, large pharma companies will want to know more about their contractors, both their CDMOs and their CDMOs’ suppliers,” said Peter Shapiro, PharmSource senior director of drugs and business fundamentals at GlobalData in a company statement (6).

Capacity questions

The manufacturing of vaccines and pandemic-related therapeutics is expected to extend well into 2021, increasing demand—and potential competition—for raw materials and supplies also used to produce other drugs. A tighter raw material supply market will pressure drug companies to reinforce and build redundancy into their supply chains, look to multiple suppliers in multiple geographic areas, and build better relationships with suppliers and contract service providers. The US government could invoke the Defense Production Act to force suppliers to expedite needed raw materials to COVID-19 vaccine and therapeutic manufacturing operations.

Given stronger demand for drugs and uncertainties surrounding the global supply chain, nations and drug companies are looking to become more self-sufficient. Countries are examining options for increasing domestic production of the APIs for essential drugs, says Lal, and traditional pharma companies are increasing their capital expenditures.

Still, demand is exceeding available capacity in some product segments, creating more work for contract manufacturers. Vaccine manufacturers are opting for dual sources, so they need to diversify in their CMO partnerships, says Lal. As a result, CMO capacity utilization has increased from normal levels of 75%, he says, predicting that investments in capacity will continue to increase.

Capacity is an industry-wide challenge, says Olivier Loeillot, senior vice-president, BioProcess, at Cytiva. “While there are bottlenecks and shortages, companies and CDMOs are accelerating expansion plans to meet demand. Long term, companies must think about their commercial manufacturing strategies earlier in the process: do they build or outsource it?”

And it’s not enough to build out capacity if you do not have the trained workforce, he says. “Companies must build out capacity in regions where there is talent to do the work.”

Home-made drugs?

Calls to onshore drug development and manufacturing, which became louder during the pandemic, are not new. “This debate over the past 20 years is like a pendulum and keeps swinging either way,” Lal says, first shifting away from Asia due to quality concerns, then shifting back as China increased its regulatory requirements and quality standards. “Now, due to the pandemic, we are seeing a lot of governments take the initiative and bring some manufacturing of the APIs and essential finished dose formulations on-shore,” he says.

With long lead times required to build manufacturing operations domestically, there is no quick fix to reduce dependency for essential drugs on China and India. For now, Lal notes, innovator pharma companies are building the resilience into their supply chains and seeking ways to better manage inventories. For the long term, he says, governments are showing interest in collaborating with bio/pharm to invest in onshoring or reshoring of drug manufacturing for essential medicines and to build regional capacity as a contingency against future pandemics.

However, he also anticipates significant decentralization of manufacturing operations to meet local demand for drug products in China and other Asia-Pacific countries, which is expected to grow exponentially in the future.

Necessity drives technology adoption

Both proven and new technologies were employed—sometimes out of necessity—during the pandemic and may become the norm for broader bio/pharma applications. “We’ve seen a significant surge in the adoption of single-use technologies,” Lal says, particularly for biopharma and cell and gene therapy companies. This is enabling is the growth of small- and mid-size specialized, niche CDMOs, and reducing overall dependence on the larger CDMOs, a trend that Lal expects to continue for the next few years.

“Single-use technologies and remote monitoring have proven invaluable this past year,” says Loeillot. “We will continue to see companies using these tools because they provide the speed and flexibility drug developers need.”

Newer technologies offer benefits for bio/pharmaceutical processing that extend beyond meeting pandemic demands. “While the world needs billions of doses of COVID-19 vaccines, many companies are focusing on small batch therapeutics and orphan drugs. That trend will continue post-pandemic,” says Loeillot. “Single-use technologies are ideal solutions for these drugs because they can produce clinical batches quickly, with reduced risk of cross contamination.”

Advanced technologies will play a greater role in bio/pharma operations, agrees Kevin Seaver, general manager for automation and digital at Cytiva. “Automation is one of the keys to delivering safe, effective, and affordable drugs to patients,” he says. “Flexible, single-use automated solutions allow for rapid adaptation to changing needs, particularly for small clinical batches, while adhering to the high-quality standards needed to control and document the manufacturing process,” Seaver explains.

Perhaps the most visible technology applications were associated with maintaining the extreme cold-chain requirements for shipping the messenger-RNA-based COVID-19 vaccines, from conventional materials such as dry ice, to storage containers, specialized freezers, and remote monitoring sensors using Internet of Things technology (7).

Drug companies, CDMOs, and regulators turned to advanced technology to maintain bio/pharma operations when pandemic travel restrictions made onsite visits and inspections impossible. Remote inspections and monitoring were put into practice at some locations, representing some first steps toward more widespread digitalization of bio/pharma operations (8).

Next steps

The efforts of biopharma experts in 2020 provided medical tools to combat the pandemic, but the battle will continue in 2021. Breakthroughs in science and research, public-private collaborations, investments in facilities and materials, and new technologies applications not only advanced solutions to the pandemic, they also may have set the groundwork for more effective drug development in the future.

References

1. BioPharm International, 2021 Bio/Pharmaceutical Development and Manufacturing Employment Trends Survey (December 2020).
2. FDA, “New Drugs at FDA: CDER’s New Molecular Entities and New Therapeutic Biological Products,” www.fda.gov, accessed Dec. 15, 2020.
3. Deloitte, Biopharma Leaders Prioritise R&D, Technological Transformation, and Global Market Presence (2020).
4. BioPharm International, 2020 Pharmaceutical Technology/BioPharm International Employment Survey (December 1999).
5. A. Brown, et. al., Pharma, Biotech & Medtech Half-Year Review 2020 (July 2020).
6. GlobalData, “COVID-19 is Driving More Supplier Redundancy,” Press Release, Nov. 4, 2020.
7. J. Markarian, BioPharm International, 34 (1) 38–40 (January 2021).
8. A. Shanley, Pharm Tech, 44 (12) 16–19 (December 2020).

About the Author

Rita Peters is editorial director of BioPharm International.

Article Details

BioPharm International
Volume 34, No. 1
January 2021
Pages: 10–13

Citation

When referring to this article, please cite it as R. Peters, “Biopharma Gets Back to ‘New Normal’ Business," BioPharm International, 34 (1) 2021.