Emerging Outsourcing Trends in 2013 - BioPlan's outsourcing survey gives insight on top activities, budgets, and growth trends in biopharmaceutical outsourcing. - BioPharm International

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Emerging Outsourcing Trends in 2013
BioPlan's outsourcing survey gives insight on top activities, budgets, and growth trends in biopharmaceutical outsourcing.


BioPharm International Supplements
Volume 26, Issue 3, pp. s4-s7

AVERAGE PERCENTAGE OF ACTIVITIES OUTSOURCED TODAY

The BioPlan study analyzed the survey data to come up with an estimate of the average percentage of outsourcing done by biomanufacturers today across the activities tracked. This measures the influence of outsourcing on an activity, rather than how commonly that activity is outsourced.

On average, facilities outsource 32% of their analytical testing/bioassays (28% last year), 31% of their fill/finish operations (35% last year), and 28% of their toxicity testing (27% last year). These numbers may be low, given that not all respondents' facilities performed all these activities. However, their relative position, and their trend over time, compared with the individual activities is instructive.

In last year's study, BioPlan observed that the greatest percentage shift in recent years occurred in analytical testing/bioassays. That trend seems to be continuing unabated this year, up another 4% points to 32%, meaning that close to one-third of analytical testing is estimated to be outsourced by the industry. Moreover, 26% of study respondents expect their facility to outsource this area at significantly higher levels over the next two years, making it the area with the biggest potential for outsourcing growth. The current and expected growth in analytical assay outsourcing may be a result of the trend toward biosimilars, which require extensive analytical comparisons between the biosimilar protein and the innovator/reference product.

API biologics manufacturing is another area seeing significant growth of operations. Again, this is forecast for continued growth, with 13% of respondents indicating that they will be outsourcing this to a much greater degree in the next 24 months.

There is a noteworthy trend towards heavier use of outsourcing in some areas. In these activities, the estimated percentage of the activity being outsourced is growing faster than the growth in percentage of facilities that are outsourcing the activity. This indicates that the facilities outsourcing these activities are becoming ever more dependent on contracting them out. Such cases include:

  • The estimated percentage of upstream (12% this year vs. 6% last year) and downstream (12% this year vs. 7% last year) development operations being outsourced rising significantly despite only a modest rise in the percentage of facilities outsourcing these activities
  • The estimated percentage of DoE being outsourced almost doubling (7% vs. 4%) despite the proportion of facilities outsourcing this to any degree remaining flat.

Data suggests that outsourcing continues to increase, even if that increase doesn't apply uniformly to all activities.

Taken together, data suggests that outsourcing continues to increase, even if that increase doesn't apply uniformly to all activities. It is interesting to see that some of the less popular outsourcing activities (i.e., upstream and downstream development, DoE) are being more heavily contracted out, suggesting that this behavior is concentrated among few industry participants who are increasingly happy with the results.

BUDGETS

Preliminary data from the BioPlan study also indicates that budgets for outsourcing are on their way up. Respondents were asked to indicate how their spending on outsourcing will change over the following 12 months, in R&D and for manufacturing.

Based on the preliminary data received, it is estimated that on average, budgets for outsourcing at individual facilities will increase by over 10% during the next 12 months; this is an increase from last year's estimate.

Not everyone has more to spend on outsourcing, though. This year, 16% of respondents have said that they expect a decrease in their outsourcing budgets of some degree, slightly more than double the percentage from last year who forecast a cutback. But those cutbacks are more than offset by the number of facilities who are looking to increase their budgets. This year, almost one in five said they are expecting to increase outsourcing budgets by more than 25%.


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