Contact Us
- Solutions
- Resources
- About
- Contact Us
close
Optional callout banner for highlighted news or events
Learn More
The life science industry, known for its resilience during economic fluctuations due to the inelastic demand for drug products, constantly faces pressure to optimize costs. An effective strategy to achieve this is outsourcing analytical testing, which, although seemingly counterintuitive, involves spending money to save money in the long run. Contract labs can be pivotal for companies aiming to manage their budgets efficiently.
Outsourcing analytical testing offers significant flexibility during early-stage projects by allowing these costs to be expensed rather than invested in capital infrastructure. This approach eliminates the need for substantial spending on hiring, training, and maintaining specialized staff and facilities. For analyses with low frequency, high specialization, or expensive equipment requirements, outsourcing proves to be a cost-effective solution. Additionally, contract labs help avoid continuous investments in equipment upgrades and staff training, redirecting these funds towards core drug development activities.
Even large pharmaceutical companies with in-house analytical departments often operate with limited shifts, underutilizing equipment and resources. This scenario makes it challenging to justify the high total cost of ownership associated with capital investments and specialized personnel.1
The global pharmaceutical analytical testing outsourcing market was valued at USD 8.3 billion in 2023 and is projected to grow at a CAGR of 8.4% from 2024 to 2030.2 Both large and small pharmaceutical enterprises increasingly collaborate with Contract Development and Manufacturing Organizations (CDMOs) for analytical testing services, allowing them to focus on their core competencies. Pharmaceutical companies dominate the analytical testing outsourcing market with a 48% share. Meanwhile, biopharmaceutical companies are expected to experience the highest growth rate, around 9%, driven by the need for analytical testing to enhance output, define biosimilars and biologics, and ensure continuous quality assurance.3
Contracting with an outsource provider for a predetermined amount of testing offers drug manufacturers a clear estimate of development costs while utilizing state-of-the-art laboratory technology. Consider the following to determine if outsourcing analytical testing will save you money:
A successful partnership with a CDMO involves a mutual understanding of analytical testing requirements and technical challenges. Drug sponsors should evaluate the CDMO's capabilities, ensuring they offer broad analytical services and have the capacity to meet deadlines. Regular communication and site audits are essential to verify the CDMO's qualifications and maintain FDA approval status.
Continuous dialogue between the CDMO and the drug sponsor is crucial even after the contract is signed. Regular meetings to discuss project status and changes in priorities help maintain a productive and efficient partnership, ensuring high-quality analytical results.
In times of economic uncertainty, the collaboration between CDMOs and drug sponsors becomes even more vital. As one leading biopharma CEO aptly put it, "We need to work things through in partnership, figure out how to survive first. People still don’t understand we are one industry. We’re all in this together, dependent on each other, and now is not the time to get greedy. Now is the time for everybody to get to the same foxhole, and figure out how do we survive."4
Like what you read? Share with your network:
