CMOs gain advantages of COVID-19 production and timescale demands: GlobalData

The COVID-19 pandemic brought not just a more difficult business environment to operate in, but also opportunities for contract manufacturing organisations (CMOs), as even the largest biopharma companies require extra capacity to supply billions of doses. Due to compressed timelines and manufacturing scale challenges for COVID-19 vaccines and medicines, CMOs signed contract manufacturing service agreements at an unprecedented rate in 2020, says GlobalData.

Adam Bradbury, PharmSource Analyst at GlobalData, comments, “These contracts were for pipeline vaccines and therapies with emergency approvals in 2020, but many of these molecules will achieve full market approvals in 2021. Findings show 50 per cent of all emergency use authorisation (EUA) drugs in 2020 had an associated contract manufacturing agreement, and this rises to 100 per cent of EUAs for just vaccines, where there have been rapid development timelines, highly innovative products (mRNA vaccines), and a global requirement for production scale.”

GlobalData’s latest report, ‘New Drug Approvals and Their Contract Manufacture – 2021 Edition’, reveals that in 2020, the Food and Drug Administration (FDA) approved 121 New Drug Applications (NDAs) and Biologics License Applications (BLAs), including New Molecular Entities (NMEs), biologics approved as BLAs through the Center for Biologics Evaluation and Research, and new formulations of older drugs.

Bradbury continues, “This represents a 2.4 per cent increase over the 2015–2019 period average of 118. Despite the disruptive effects of the pandemic on the FDA, the overall number of approvals increased from 2019’s total of 119. The total numbers of innovative small molecule and biologic NMEs have risen since last year, with biologic NME approvals at the highest level over the last decade.”

NDA approvals were relatively high in 2020 for small-cap companies (market cap <$2 billion) compared to approvals from 2011–2020. The count of drugs sponsored by small-cap sponsors increased from 2019.

Bradbury concludes, “This trend is potentially advantageous to CMOs, given that historically their clients are more likely to be smaller companies that are unable to invest in their own facilities or enhance their own capabilities.”