New drug approvals by FDA continued their upward advance in 2012, but CMOs didn't benefit much from the improvement. The data
suggest that the market share of dose CMOs may have peaked.
In 2012, FDA's Center for Drug Evaluation and Research (CDER), which approves new small-molecule and biologic therapeutic
drugs, approved 101 new drug applications (NDAs). This level was on par with the 102 new drugs approved in 2011 and continues
the recovery in NDA approvals that started in 2008 (see Figure 1).
Figure 1: New drug application (NDA) approvals, 2006-2012. NME is new molecular entity. (ALL FIGURES COURTESY OF AUTHOR)
The composition of the new approvals was particularly noteworthy. Of the 101 NDA approvals, 39 were for new molecular entities
(NMEs) (i.e., drugs containing an API that was approved for the first time). The NMEs included 10 biologics and 28 small molecule
drugs. This level was the most NME approvals in more than seven years.
There were 62 non-NME drugs approved (i.e., drugs containing a previously approved API). Of those, 47 were approved via the
505(b)(2) route, which provides for a simplified approval process for new formulations of previously approved drugs. The 505(b)(2)
process is particularly popular with specialty pharmaceutical and generics-drug companies because it is a lower-cost and lower-risk
process for developing new drugs than developing NMEs.
Outsourcing trends remain unchanged
While the approvals trend grew stronger, the propensity for outsourcing the manufacturing of these new drugs remained flat.
Overall, dose manufacturing was outsourced for 42% of the NDAs approved in 2012, which was consistent with the 41% average
for the previous six-year period (see Figure 2). Both NMEs and non-NMEs were outsourced at the 42% rate.
Figure 2: Share of new drug application (NDA) approvals outsourced, 2006-2012. NME is new molecular entity.
The propensity to outsource was largely a function of the nature of the approval and the size of the company getting the approval.
Global and mid-size biopharma companies were more likely to outsource their non-NMEs than their NMEs; the global biopharma
companies did not outsource dose manufacturing for any of their biologics approvals, but did outsource some of their small-molecule
approvals. Small companies outsourced dose manufacture for most of their new approvals, both NME and non-NME, including 100%
of their biologic approvals. As one would expect, generic-drug companies outsourced few of their new approvals.
A total of 28 different dose CMOs benefited from new product approvals in 2012. Only six had more than one approval, with
Catalent (six new approvals) and Patheon (four new approvals) leading the way.
PharmSource analysis of eight years of FDA approvals data suggests that the acceptance of the CMO business model and its penetration
of the biopharmaceutical industry have remained relatively unchanged throughout most of the past decade. NME dose-form outsourcing
has remained relatively constant for the past seven years as the industry is governed by two basic truths: smaller companies
have a strong tendency to outsource while global biopharma companies have a strong preference to keep products in-house.