API relocation strategies for CDMOs

The COVID-19 pandemic has exposed several weaknesses in global pharmaceutical supply chains, this is particularly true when it comes to APIs. Governments have responded forcefully with production relocation initiatives encouraging manufacturers to source supplies from closer to home. 

API production and supply chains are now seen as the sole means of maintaining our living standards through immediate and constant access to medicines.

In a bid to build cost-efficient supply chains, the west has gradually moved the manufacture of critical molecules that form the building blocks of essential medicines overseas. The fully integrated pharma value chain has mutated into a value constellation network, where strategic partnerships and outsourcing of non-core activities are the new norm.

In recent years there has been a concerted effort to bring some of the manufacture home and this has been further exacerbated by the recent pandemic. The CDMO space has been consolidating at a fast pace over the last 20 years, mostly by leveraging US and EU capabilities and capacities that pharma companies lacked in house. In doing so, CDMOs like Recipharm have played an important role in retaining capabilities, skills, knowledge, and jobs in the west, investing in modernisation of assets close to their customers and ultimately patients.

Our President Development Services, Bernard Pluta, discusses recent changes in the pharma industry and how CDMO’s play an active role in addressing the API relocation challenge. You can read more here.