CPhI panel warns 'commitment dilution' hindering drug development and price pressure compromising safety

CPhI panel warns 'commitment dilution' hindering drug development and price pressure compromising safety

Paris, 09 October 2014:CPhI Worldwide, part of UBM Live's Pharmaceutical Portfolio, today announces the findings of the final part (part iii) of its 2014 annual report at the 25th CPhI Worldwide in Paris. Three World-renowned experts – Hedley Rees, MD at PharmaFlow Ltd, Hendrik Baumann, CEO of Arevipharma and Lukas Utiger, President, DPx Fine Chemicals and Integrated Offering – each have examined the pharma industry, particularly from a supply chain and contract services perspective, providing analysis on how this market will adapt and grow. 

Hedley Rees believes that one of the major problems that currently exists within the pharmaceutical development industry is that many biotech's and virtual companies are simply looking for an exit part way through development and larger companies are only looking to develop proven products, resulting in a severe 'commitment dilution' that is slowing down and hindering innovation.

Lukas Utiger has suggested there is currently an imbalance between supply and demand of manufacturing capability, which is resulting in unsustainable price pressure. Hendrik Baumann warns that increasing price pressures being experienced by API producers worldwide, if not addressed, will result in increasing GMP issues and threaten patient safety. As a result, he argues we are at the start of a split within the contract services sector, which ultimately will lead to European API producers concentrating on flexible delivery across multipurpose plants, with Asian facilities concentrating on single use facilities for low cost commodity type production.

In order for the industry to survive we will see increased consolidation and integration of services across larger CDMO players with Utiger predicting increased strategic partnerships between pharma and key CDMO providers. Ultimately, this will result in several CDMOs having more than 10% of drug product and substance market chain in as little as 3 years time. 

The use of outsourcing is also resulting in severe supply chain pressure and Hedley Rees foresees a continuation of the slow progress that has so far blighted government and regulatory proposals to appropriately tighten the commercial supply chain. Baumann added that this is creating an unfair playing field for API producers, particularly with regard to cGMP, environmental protection and sustainability. Furthermore, as a direct consequence of increasing use of tender business we are likely to see future shortages of popular drugs due to decreased warehouse capacity.

Rees has foreseen big pharma reacting to these supply chain issues with an increasing scrutinisation of CMC packages for potential licensing partners. Venture capitalists will seek to reduce risk by only targeting developers that can leverage ex-vivo and in-silico predictive screening methods. However, ultimately Hedley Rees argues that regulators are not the answer to underlying issues of poor practices within the development supply chain of drugs and the industry will realise that QbD is about engaging with end-users and involving stakeholders that have historically been held at arms length.

Finally, Baumann has seen increased innovation entering the market through western contract services development in response to pricing pressures. One innovation that will be crucial in developed markets is the use of microreactors, which allow for seamless up scaling of processes using parallelisation instead of batches.

CPhI has made the full findings of its annual report available for download at:

Chris Kilbee, Group Director Pharma at CPhI: "The final part of the 2014 CPhI annual report examined the perspectives of outsourcing and the supply chain across the pharmaceutical sector. As we can testify with the growth in total exhibitors at CPhI, the pharma supply chain is now hugely complex and diverse, and choosing the right partners and processes is critically important in any products' viability. Our experts state that without proper controls and an appropriate plan to take the supply chain from the clinical trial to commercial scale there are serious risks. They recommend a number of measures to de-risk this process and with strategic partnerships clearly on the rise we see CPhI's role in the industry as being ever more important than before. I would advise all of the attendees and the wider industry to download a (free) full copy of the report. With our annual report, CPhI is actively encouraging knowledge sharing and innovation across the industry, the future is very exciting and we believe these findings will help the pharma community to work better together"


About CPhI
CPhI drives growth and innovation at every step of the global pharmaceutical supply chain from drug discovery to finished dosage. Through exhibitions, conferences and online communities, CPhI brings together more than 100,000 pharmaceutical professionals each year to network, identify business opportunities and expand the global market. CPhI hosts events in Europe, Korea, China, India, Japan, Southeast Asia, Istanbul, Russia and South America and co-locates with ICSE for contract services, P-MEC for machinery, equipment & technology, InnoPack for pharmaceutical packaging and BioPh for biopharma. CPhI provides an online buyer & supplier directory at CPhI-Online.com.
For more information visit: www.cphi.com

The UBM Live annual schedule of Pharmaceutical events also includes; CPhI, ICSE, P-MEC and InnoPack Worldwide (7-9 October 2014, Paris Nord Villepinte- France); CPhI and P-MEC India (2-4 December, 2014 at the Bombay Exhibition Centre- Mumbai); CPhI, ICSE, P-MEC, BioPh and Pharmatec Japan (22-24 April, 2015 at the Big Sight Exhibition Centre- Tokyo). CPhI Russia and IPhEB (27-29 April, 2015 at the VVC, Pavilion Nr 75, Moscow Russia); CPhI, P-MEC and Innopack South East Asia (26-28 May, 2015 at the Jakarta International Expo- Jakarta, Indonesia); CPhI Istanbul (3-5 June, 2015, at the Lutfi Kirdar Convention and Exhibition Centre- Turkey); CPhI, Hi and Fi, ICSE, P-MEC, BioPh and LabWorld China (23-25 June, 2014 at SNIEC- Shanghai, China); CPhI, ICSE Korea (7-9 September, 2015 at the COEX- Seoul, South Korea).

About UBM Live
UBM Live connects people and creates opportunities for companies across five continents to develop new business, meet customers, launch new products, promote their brands, and expand their market. Through premier brands such as TFM&A, Internet World, IFSEC, MD&M, CPhI, Cruise Shipping Miami, the Concrete Show, and many others, UBM Live exhibitions, conferences, awards programs, publications, Websites, and training and certification programs are an integral part of the marketing plans of companies across more than 20 industry sectors.

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