WEBVTT
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You're evaluating C DMO partners.
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What are some of the non-negotiable criteria you'd advise that they validate first?
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Thinking things like quality of track record, tech transfer, capability, capacity, supply chain resiliency.
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What are some of those important things to take a look at before you even get to pricing?
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There's a number of things.
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And a lot of it is depending on, I always say, kind of know thyself first.
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Where are you in the development landscape with your program?
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The early stage, mid-stage.
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Do you think you have a blockbuster?
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Is it rare disease type product?
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Kind of knowing all those things.
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And the non-negotiables are going to be equipment matchup.
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Done some work here in our own facility.
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Maybe it's bench top, maybe it's into phase one, just a little bit of a GMP operation in your facility.
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I'm your host, Jonathan Kaskey.
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Technology and market trends are bringing change at an ever accelerating rate, and no person, team, or company can afford to be left behind.
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Here, we dive into the strategies and tactics that our guests use to tackle these challenges and create new opportunities, and how you can do the same in your own organization.
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This episode of Pharma Sessions is sponsored by Exont, makers of the X1 reporting platform.
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On today's episode of Pharma Sessions, I'm thrilled to welcome Frank Sorce, Chief Commercial Officer at UPM Pharmaceuticals and a seasoned commercial leader with deep experience across pharma manufacturing, business development, and strategic partnerships.
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I thought this could be a really cool conversation in that Frank has spent his career helping biopharma companies navigate decisions around development and manufacturing, which is important to any organization, right?
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So we're going to spend a lot of time about talking about selecting the right CDMO, structuring long-term partnerships, and how to maintain a focus on both quality, reliability, while balancing that with price, which of course comes up with all of these discussions.
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All right.
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With that, welcome to the show, Frank.
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Jonathan, great to be here.
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Really excited for this conversation.
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Good to see you again.
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Yeah.
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Two feet of snow outside of my window.
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How's how's your back?
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You do a lot of shoveling over the last couple of days?
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I was on the snowblower for about three hours on Monday.
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I've got two neighbors that just don't seem to be able to do their own driveways in addition to my driveway.
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So I did my good deed for the year.
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That's good.
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Yeah.
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Where I live, there's a lot of retirees, and I did mine, and I helped my neighbor shovel a path to his car and get his path out.
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But after that, that was like four hours.
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I'm like, you know what?
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My I feel like that's all I got in me.
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Yeah, the vibrations in my hands were just about all I can take at that point.
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Excellent.
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Well, thanks for joining.
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And let's just dive right in.
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So you've seen C DMO relationships from both sides of the table.
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Do you want to maybe start by sharing a little bit about your background and then we'll ask some questions about your experience here?
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Sure.
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So I was calculating some things.
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So I'm in my 37th year here of pharma business.
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I started right out of school with Merck Sharp and Dome, spent about eight years in the Merck organization, got my master's in marketing through their education support program.
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And after that stint of eight years or so, I moved on into the sort of the contract sales business, which at that time was a very early Sinios for a couple of years and a very early IQ via, which were under different names at that time.
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Sure.
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And we supported Large Pharma in putting boots on the ground for them, sort of supplementary sales forces.
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And one of those clients was Reliant Pharmaceuticals.
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And I ended up joining them directly here in the Northeast as the regional business director.
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And we started that company, launched it, and then eventually sold it to Glaxo in the mid-2000s.
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And just took a little time off, and then I joined UPM Pharmaceuticals for my first tour of duty as an individual contributor in business development.
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And I also managed the marketing function right from day one.
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So I spent 12 years with UPM, individual contributor, eventually became VP of BD in marketing.
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They had a reorganization around 2019, and I moved on.
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I worked at Synergy Pharma, which is a high-powered CMC medical writing regulatory consulting firm based in Framingham.
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And I started their BD operation in 2021, and I was enticed to come back to UPM the sort of end of 2024, and started my second tour of duty last March 2025.
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So I've seen a lot across the industry.
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So you're you're a pharma lifer.
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Yeah, I am.
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Both sides of the fence.
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That's great.
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So so with all of that history, I'm sure you have a lot of experience.
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It sounds like starting in marketing, right?
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And then moving over to manufacturing and CMC consulting and back to C DMO.
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When a pharma, because most of my listeners are at pharma companies, when the pharma company first begins the C DMO selection process, what do you think are some of the biggest misconceptions they tend to have about how that decision should be made?
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I think some misconceptions are we can do this now remotely.
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We can go online, we can look at websites, we can see ads and journals, we can get corporate decks, and we can do a lot of that vetting from 30,000 feet apart.
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And I think COVID, a lot of people did virtual tours and they said, Hey, we did okay, we made a selection and we're and it's working out for us, but you still got to get to the sites.
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And why is that?
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Because you can only observe so much from a remote location.
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Just pulling into the parking lot of a CDMO, you'll start to make judgment on this organization.
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Is the grass cut?
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Is the security booth in good shape?
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Is the front door clean?
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Is the the mulch kept where it's supposed to be?
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You make these you start to make a judgment as soon as you get on the premises on the property.
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Right through to the meeting room they put you in, through the tour, the meeting of people, all those intangibles are important to the selection.
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And of course, do they have the right equipment?
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Is the place clean?
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Is there all those things that you kind of take for granted?
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But those are all obviously very important in your decision making.
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So you're saying attention to detail in the small things is a good indicator that carries through to the important parts of manufacturing.
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If they don't take care of the small things, how are they going to take care of the big things?
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Is there soap in the soap dispenser?
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Why go in the men's room?
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Right.
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Those little details about the organization will help you in your decision making.
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I'm smiling because I like that maybe this is too much information.
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Maybe not.
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If I go to a restaurant and I go to the bathroom and the bathroom's dirty, I'm like, let's get out of here.
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Like I do not want this.
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Exactly right.
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And that totally makes sense, right?
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Because you need a clean facility where every last detail of the operational manual is followed to a D.
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It has to be.
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So what are some of the, let's say, again, you're in that you're for that pharma company, you're evaluating C DMO partners.
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What are some of the non-negotiable criteria you'd advise that they validate first?
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Thinking things like quality of track record, tech transfer, capability, capacity, supply chain resiliency.
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What are some of some of those important things to take a look at before you even get to pricing?
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Yeah.
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So there's a number of things.
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And a lot of it is depending on, I always say, kind of know thyself first.
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Where are you in the development landscape with your program?
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Your early stage, mid-stage.
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Do you think you have a blockbuster?
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Is it is it a rare disease type product?
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Kind of knowing all those things.
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And the non-negotiables are going to be equipment matchup.
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Done some work here in our own facility.
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Maybe it's bench top, maybe it's into phase one, just a little bit of a GMP operation in your facility.
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Now I'm going to move.
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I want to make sure that the equipment we've been working on is a match for the equipment you're going to be working on.
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I don't want to change the manufacture of the equipment or the mechanism of which it performs its function.
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I really want to make sure I'm dealing with like for like.
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It may not be an exact match, but does the technology match up?
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Then I want to look at your inspection record.
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Where were you last inspected by?
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What are those health authorities?
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What do those inspections say about your facility?
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Did you pass?
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Did you get out of 483?
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I've got to have a clean track record from a regulatory standpoint.
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And then I'm evaluating how are you responding to my inquiry?
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How quickly are you getting back to me?
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How arduous is your CDA process?
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If I can't get the time of day when I'm approaching you or get some, what are you going to do when we sign a contract?
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Right now, bonded to you contractually.
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For years.
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For years, exactly.
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Right.
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I mean, you're not buying a batch, you're buying a relationship.
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And that's going to be a long-term, hopefully, good relationship for both sides.
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So I've got to have that sense that I'm important because if I'm not important today, I'm not going to be important tomorrow.
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A hundred percent agree.
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And things like responsiveness and just I don't know how how you all are structured here.
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It's when I'm talking to people, I know that I'm not going to be ultimately working with the salesperson usually, but I want to at least meet the team of who I'm working with, right?
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And make sure that if I'm thinking this is going to be a multi-year relationship, this is going to be somebody who I trust who I who I can think will have my best interest at heart.
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And yeah, I think getting back to your first point, you kind of have to do that face to face.
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It's not that different from hiring employees, honestly, right?
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Like we do so much, we do so much virtually, but we just need to meet somebody in order to really get a sense of them.
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Yeah, and I I will, you know, in the consulting world, it was very common.
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Say, listen, we're going to need support for this particular program.
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And they'd say, I want to meet the consultants, I want to spend an hour with them one-on-one.
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And you should bring that same level of diligence to the CDMO space.
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Who's my project manager?
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Can I go in a conference room one-on-one and talk to them?
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See what their experiences, see what have they worked on this kind of program before, and you know, really get that, like you say, it's an interview because it's a huge decision for the organization.
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So along those lines, and you would essentially, I think what you were getting at when you were saying, hey, if I'm not going to get treated well before I sign a contract, what's it going to look like afterwards?
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It's sort of how do you separate a sales story from an operational reality?
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So what evidence should these sponsors be looking for to confirm that a site can actually execute beyond audits that you're you pass your slide deck?
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Sure.
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This is you know, these are through conversations, and you may get some documentation.
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We deal in a solid oral world.
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Someone comes and says, Listen, I've got this concept.
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Do we want a modified release version of this particular molecule?
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What have you done before?
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Can you give me three examples of how you worked with a compound that was immediate release forever, and you modified that release rate and gave it sort of an advantage and extended its life cycle five more years?
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And we're going to benefit from that.
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Give me a concrete example of that.
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And if they're vague about it, there's a red flag there.
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Okay.
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We took it in, we did we perform these experiments, we scaled it this way, you use this equipment.
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Here was the outcome.
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They eventually got an approval.
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Whatever that case study is on that particular program, you want to say we've done it, not we can do it.
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And that's those are two different things.
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And is that what you find people ultimately?
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I'm sure you're in competitive situations all the time, and some people select you and some people, some people don't, right?
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But for the ones with when they do select you, is that the reason?
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Is that trust building, or what is kind of the reason that you get selected?
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Yeah, so there's it's a multi-factor decision.
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So is the equipment right?
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Can we grow within this organization?
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Can you scale?
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Take us beyond phase one or two.
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Do you have that experience with this particular modality?
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Have you worked on solid oral and taken this kind of a product forward with these parameters that we're giving you?
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And then, of course, your quality system.
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How is your quality team?
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How do they interact with operations?
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How will they interact with us?
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Can I check some references?
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Those are the, I guess, steps you gotta take in your selection.
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And where does capacity fit into all of this?
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Because I'm sure there's always pressure in a manufacturing business that ownership wants to see more sales coming in, but then you ultimately need to be able to deliver on your commitment.
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So what what do you think are some red flags that farmers should be looking for that a C DMO may be either overcommitted or struggling operationally, even if they look strong on paper?
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I think that you're probably gonna get that sense if it's very difficult to move to next steps in the negotiation.
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Like it took me a month to get a proposal.
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What's going on there?
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I can't get in the facility to do my visit.
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QA audits are six months out.
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All of those are telling me he's got it maxed out.
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You don't want a ghost town when you go there, but you don't want a situation where bins are flying back and forth and you know it looks like chaos in the facility.
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And you know, you want it you want a brisk sense of movement, but not too much.
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But all of those things up front will tell you, hey, something's wrong here.
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They're they're just like I'm not gonna get a slot.
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Even if we consummate this relationship, I'll never get the slots and for manufacturing stuff.
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We'll ship gears here to a little bit of where you think this this industry is headed.
00:15:26.549 --> 00:15:31.590
So maybe let's start to talk about I guess pricing and alternative models.
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So, what's your take on risk sharing or dynamic pricing models and CMO deals?
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Can you describe what that even is?
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And then when they create real realignment, when they become a trap for either side.
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That is a buzz term right now, is dynamic pricing.
00:15:46.950 --> 00:15:52.389
And some organizations, and I think this is Can you define what it is before before getting into it?
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Yeah, yeah it's going beyond fee for service.
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Traditionally, we'd say a bat's going to cost you 50,000, stability time points 3,500, a development report is 7,000, and you got a Chinese menu of everything, and then it's 500 grand, and that's what you pay.
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And with organizations, especially small clinical virtual companies, they can't raise the money they had been raising in the past.
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The last probably three years has been really tight in raising money in whatever fashion you're trying to do it.
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So they're unlimited budgets.
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So they'll say if we can meet these time frames, let's say you can get me in a clinic in three months versus six months, I'll give you a 25% bonus.
00:16:42.310 --> 00:16:48.789
So you'd be 25% cheaper on your price, but there's a kicker that would be worth it to you.
00:16:48.950 --> 00:16:54.870
So those are kind of scenarios that people are talking about right now.
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And what's your take on those?
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Are they effective or is it uh like an overcomplication?
00:17:01.909 --> 00:17:07.349
I think they can be really effective for both sides if they're well thought out.
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Because if I normally get$500,000 for this program, but if it's successful, I have an opportunity to make$550.
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That's another 10% that I normally would not have gotten if I just was a feed for service model.
00:17:22.630 --> 00:17:35.990
Now, certain organizations, if the program isn't successful or they have an adverse reaction that's just so severe they have to stop the program, you could be out a few dollars as well.
00:17:36.230 --> 00:17:45.670
It's a matter of you have to attract a number of clients to be in your portfolio so that you have a vibrant pipeline moving forward.
00:17:45.990 --> 00:17:52.069
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So if you want to understand your market, your customers, or your performance with more clarity than ever, check out excent.com.
00:18:28.150 --> 00:18:31.509
That's xs-unt.com.
00:18:31.910 --> 00:18:34.309
All right, let's jump back into the episode.
00:18:34.630 --> 00:18:41.750
That seems like a really tricky spot to put a C DMO in because I mean, you know if trials fail all the time, right?
00:18:41.910 --> 00:18:46.069
It's baked into the pharma model that only a certain percentage are gonna make it out.
00:18:46.230 --> 00:18:46.549
That's right.
00:18:46.710 --> 00:18:54.470
I'm not so sure that it's baked into the C DMO model that half of your whatever percentage of your contracts are gonna fail out.
00:18:54.710 --> 00:19:01.509
So I would bet you don't really have the medical science expertise on staff to try to make those decisions.
00:19:01.670 --> 00:19:02.470
Not that you even can.
00:19:02.549 --> 00:19:06.069
Like no, no, you don't, and you never seem like a huge risk.
00:19:06.309 --> 00:19:07.829
It is a big risk.
00:19:08.150 --> 00:19:13.670
But if the market prevails in that direction, you have to deal with it.
00:19:13.829 --> 00:19:16.390
You can't stick your head in the sand and say it doesn't exist.
00:19:16.470 --> 00:19:19.349
You're gonna have to say, okay, how we how can we make this work?
00:19:19.509 --> 00:19:24.470
And that's where you you get to the negotiation table and you're trying to make a big deal for everybody.
00:19:24.710 --> 00:19:24.870
Right.
00:19:24.950 --> 00:19:31.750
You're almost like a VC trying to create a little portfolio of uh companies so that if if some of them fall out, you have some successes.
00:19:32.069 --> 00:19:32.789
That's exactly right.
00:19:33.269 --> 00:19:40.789
All right, so then try and think of a way to ask this without getting super super political, and these things are changing by the minute, right?
00:19:40.870 --> 00:19:47.829
But let's just say there's there's all this geopolitical manufacturing reshoring pressure, right?
00:19:47.990 --> 00:19:57.109
And then there's also risk that tariffs may be there one day, may not be there another day, who knows, and who knows what it's going to be by the time this thing even comes out.
00:19:57.349 --> 00:20:12.230
So, how much do you think what are you seeing companies like how much are they factoring that into their decisions around where to manufacture trade-offs between cost, speed, supply chain reliability when they're choosing sites these days?
00:20:12.549 --> 00:20:18.789
I think it's definitely in the thought process should we make this product in the US?
00:20:19.109 --> 00:20:19.910
That's there.
00:20:20.150 --> 00:20:31.190
There were a number of opportunities that we looked at last year where big pharma got our pricing, looked at it and said, we're just gonna leave it where it is, right?
00:20:31.589 --> 00:20:43.430
And wait, we we think that we can do it, and even if we put the tariff in there, it's still less expensive for us to make it ourselves than to use a US supplier.
00:20:43.750 --> 00:20:54.870
It's just not worth it because obviously they do it themselves in a particular country where labor is less expensive than North America, they're gonna have lower margins there.
00:20:55.029 --> 00:20:57.349
It's not gonna be as expensive if they do it in the U.S.
00:20:57.509 --> 00:21:05.349
And when they factor in 10% or 15% tariff, it just makes sense to just hold pat with what you don't.
00:21:05.509 --> 00:21:11.190
There's another contingency that's sort of, for lack of a better term, maybe more patriotic.
00:21:11.509 --> 00:21:17.349
And they're like, Listen, let's do this, let's build a facility here, let's move the product to the U.S.
00:21:17.910 --> 00:21:21.509
United States people work on products that they're actually going to consume.
00:21:21.750 --> 00:21:27.430
And then give them pride in making something, bring that whole concept back.
00:21:27.750 --> 00:21:29.190
Are you seeing that really happen?
00:21:29.430 --> 00:21:29.990
I am.
00:21:30.150 --> 00:21:33.509
I am seeing folks that say, listen, let's do it here.
00:21:33.670 --> 00:21:35.430
Let's get the best price we can.
00:21:35.509 --> 00:21:40.150
And depending on the dosage form, you get a pretty competitive price right now.
00:21:40.390 --> 00:21:43.670
In this solid world, there's a lot of capacity in the marketplace.
00:21:43.829 --> 00:21:47.029
If you're in a antibody drug conjugate, it might be tighter.
00:21:47.190 --> 00:21:49.349
If you're in a monoclonal, it might be tighter.
00:21:49.589 --> 00:21:55.990
But if you can get a competitive price and make it here, some people really want to do that.
00:21:56.470 --> 00:21:57.910
So that's really fascinating.
00:21:57.990 --> 00:22:10.710
I remember this is what they I'm trying not to be overly cynical here, but one thing I remember from business school was a survey where they asked people, I think it was jeans, they're like, how much extra would you pay if a pair of jeans was manufactured in the US?
00:22:10.870 --> 00:22:15.750
And people said all of these numbers, and then then they did an actual experiment to see.
00:22:16.150 --> 00:22:18.150
How much people were really willing to pay for?
00:22:18.390 --> 00:22:19.670
And the answer was zero.
00:22:20.230 --> 00:22:20.789
Different story.
00:22:20.870 --> 00:22:21.029
Yeah.
00:22:21.589 --> 00:22:22.390
Totally different story.
00:22:23.509 --> 00:22:24.069
But it's good, right?
00:22:24.150 --> 00:22:26.470
If people are willing to put their money where their mouth is, right?
00:22:26.630 --> 00:22:35.509
And but I think that the the smaller that delta gets, right, the easier it is to make that business case right to your leadership and increase manufacturing here.
00:22:35.829 --> 00:22:38.150
So let me ask you about another topic, Frank.
00:22:38.309 --> 00:22:43.910
Continuous manufacturing adoption versus traditional batch processes.
00:22:44.230 --> 00:22:48.309
Can you explain what this is and whether this is a trend that people should be paying attention to?
00:22:48.789 --> 00:22:57.269
It's probably been the concept of continuous manufacturing has been talked about for like 15 years, I've heard it.
00:22:57.589 --> 00:23:04.870
And a lot of the big pharma companies would only speak to a CDMO if you had this technology versus the batch.
00:23:05.109 --> 00:23:11.269
The concept, and this is my understanding of it, we've never done that here at UPM.
00:23:11.509 --> 00:23:26.789
So I'm not an expert by any means, but it's just supposed to be a more efficient way of making a product and taking a little bit of risk out of if you make one big batch and it fails, you lose the whole thing.
00:23:26.870 --> 00:23:35.509
And you may have a very expensive active ingredient, and now you're you're out that money, and now you're gonna fight on who's gonna pay for it, whose fault was it?
00:23:35.750 --> 00:23:53.509
The finger point and start, the legalities come in versus a continuous process where you can stop it, got an issue, we only lose a little bit of product or a little bit of drug product, and then it continues, and it's also a little bit more efficient where you're not maybe moving room to room.
00:23:53.750 --> 00:23:58.069
You do your blending here, you do your milling right next to it, right?
00:23:58.309 --> 00:24:11.829
You do your sizing, and now you do your encapsulation or compression, and it's right in not one little room, but a bigger room, but it's all contained there versus moving it to different parts of the facility where there's some risk, obviously.
00:24:11.910 --> 00:24:13.349
Yeah, if you do that.
00:24:13.910 --> 00:24:22.470
So I haven't seen a ton of CDMOs doing that or offering that, and that's just from my vantage point.
00:24:22.870 --> 00:24:29.829
That's this whole conversation is so interesting to me because I spend most of my time talking to commercial people and medical people, right?
00:24:29.910 --> 00:24:32.150
Where it's it's so it's it's a bit.
00:24:32.309 --> 00:24:43.750
I mean, we're talking about data all day long, but it's removed from the actual concept sometimes of like, well, somebody's got to get all this stuff into an actual pill that people can get into their bodies.
00:24:44.150 --> 00:25:00.870
And for me, it seems like magic because one of my strongest college memories in an academic setting is trying to complete organic chemistry labs and just failing over and over to the point where I was like, I'm following the directions.
00:25:00.950 --> 00:25:03.509
I feel like you know, like Harry Potter and Potions class.
00:25:03.589 --> 00:25:05.829
Like I just can't get the thing to work and I'm staying late.
00:25:05.910 --> 00:25:13.509
The TAs are getting like annoyed that they have to pay, and I'm just like not being able to synthesize these things.
00:25:13.589 --> 00:25:24.870
So it really is amazing that you all can do this at scale, at consistency, where somebody can go into CVS at the end of the day, get something, and not have to think twice before they put it in their mouth.
00:25:25.029 --> 00:25:26.630
So it really is it's amazing to me.
00:25:26.950 --> 00:25:27.750
Myself as well.
00:25:27.829 --> 00:25:34.789
You know, when I started on the sponsor side, say, you know, in sales and marketing, you didn't even think about how it was made.
00:25:34.950 --> 00:25:37.269
You're like, what was the inactive ingredients?
00:25:37.349 --> 00:25:41.190
Or you just said, hey, doc, take this uh once a day and your blood pressure goes down.
00:25:41.430 --> 00:25:45.190
It costs uh a dollar a day versus two dollars for the competitor.
00:25:45.349 --> 00:25:50.789
And then when I got into UPM in 2007, a head was spinning.
00:25:50.950 --> 00:25:53.029
About how smart these people are.
00:25:53.190 --> 00:25:55.190
They are in brilliant people.
00:25:55.990 --> 00:26:00.069
And and it also when someone says, Why does it cost so much?
00:26:00.230 --> 00:26:02.069
Why do these products cost so much?
00:26:02.309 --> 00:26:18.870
If you were in the bowels of a manufacturing facility, a development operation, and you saw the work that was being done, this how many sleeves were rolled up, and the intelligence, intelligence of these people, you may think a little bit more about that statement.
00:26:19.109 --> 00:26:19.829
That's fascinating.
00:26:19.910 --> 00:26:23.589
I mean, it really is very it's important work because it it just can't go wrong.
00:26:23.750 --> 00:26:25.750
That's different than a lot of jobs, right?
00:26:25.910 --> 00:26:26.710
Where that's right.
00:26:27.190 --> 00:26:30.470
All right, so let's wrap up with just a couple closing questions here, Frank.
00:26:30.710 --> 00:26:32.630
This has been super interesting for me.
00:26:32.870 --> 00:26:41.430
But looking back across your career, what's one lesson about C DMO selection that pharma leaders can usually only learn after something goes wrong?
00:26:41.750 --> 00:26:47.509
Yeah, I I think the the lesson is defining success up front.
00:26:47.990 --> 00:26:50.150
What are you looking for in the partner?
00:26:50.470 --> 00:27:00.230
You know, what are those non-negotiables that are really important to you, the selection team, and the folks that have to work with the CDMO on an ongoing basis?
00:27:00.950 --> 00:27:03.109
You need to define that all up front.
00:27:03.349 --> 00:27:11.430
And then you need to go out and vet those things and make sure all the boxes are checked that are important to you.
00:27:11.750 --> 00:27:29.349
And you have to go to the sites and see the people, meet the people, and in the end, you gotta use your gut and say, I I think all three of these can do it, but I just have a feeling XYZ C DMO is the right choice for us.
00:27:29.589 --> 00:27:40.470
And then you know, you could always defend that decision-making process if something goes wrong, and you'll you'll sleep at night because you did your due diligence.
00:27:40.950 --> 00:27:42.309
Yes, I love that.
00:27:42.470 --> 00:27:48.549
That's been my take to a number of kind of big decisions where to work, uh, various things.
00:27:48.710 --> 00:27:55.430
It's like if I get bit by something that I wasn't expecting, I'm actually okay with that, right?
00:27:55.589 --> 00:27:58.390
Like I you do what you can, you figure out what you can.
00:27:58.549 --> 00:28:05.750
It's like you never want to go into something with a concern, and then that's the thing that gets you, and you're just like, yeah, I should have listened to myself.
00:28:05.910 --> 00:28:06.309
I knew it.
00:28:06.789 --> 00:28:07.990
I absolutely knew it.
00:28:08.150 --> 00:28:10.309
You don't want to be kicking yourself down a road.
00:28:10.549 --> 00:28:11.109
Well, awesome.
00:28:11.190 --> 00:28:12.069
Well, let's leave it there.
00:28:12.150 --> 00:28:22.710
So trust trust your instincts, do your due diligence, trust your instincts, and you will end up with a happy and fruitful partnership with your C DMO of choice.
00:28:22.950 --> 00:28:25.670
And Frank, thank you so much for your time today.
00:28:26.069 --> 00:28:27.109
Pleasure, Jonathan.
00:28:27.190 --> 00:28:28.069
Thank you.
00:28:28.710 --> 00:28:36.710
This episode of Pharma Sessions is sponsored by Xunt, makers of the X1 reporting platform.
00:28:37.430 --> 00:28:42.549
And that's a wrap on today's episode of Pharma Sessions with me, Jonathan Kaske.
00:28:42.710 --> 00:28:50.710
If you enjoyed today's conversation, don't forget to hit follow or subscribe and share it with someone else in the pharma world who might need to hear it.
00:28:50.950 --> 00:28:58.950
For more on pharma trends, career growth, and business strategies, connect with me, Jonathan Kaske, on LinkedIn.
00:28:59.109 --> 00:29:01.589
Until next time, thanks for listening.
00:00:01.600 --> 00:00:04.080
You're evaluating C DMO partners.
00:00:04.240 --> 00:00:08.320
What are some of the non-negotiable criteria you'd advise that they validate first?
00:00:08.560 --> 00:00:14.240
Thinking things like quality of track record, tech transfer, capability, capacity, supply chain resiliency.
00:00:14.400 --> 00:00:18.320
What are some of those important things to take a look at before you even get to pricing?
00:00:18.640 --> 00:00:19.839
There's a number of things.
00:00:19.920 --> 00:00:24.480
And a lot of it is depending on, I always say, kind of know thyself first.
00:00:24.559 --> 00:00:27.679
Where are you in the development landscape with your program?
00:00:27.920 --> 00:00:29.679
The early stage, mid-stage.
00:00:29.920 --> 00:00:31.600
Do you think you have a blockbuster?
00:00:31.760 --> 00:00:34.079
Is it rare disease type product?
00:00:34.240 --> 00:00:35.679
Kind of knowing all those things.
00:00:35.759 --> 00:00:39.119
And the non-negotiables are going to be equipment matchup.
00:00:39.439 --> 00:00:42.079
Done some work here in our own facility.
00:00:42.240 --> 00:00:48.560
Maybe it's bench top, maybe it's into phase one, just a little bit of a GMP operation in your facility.
00:01:02.880 --> 00:01:05.040
I'm your host, Jonathan Kaskey.
00:01:05.280 --> 00:01:14.079
Technology and market trends are bringing change at an ever accelerating rate, and no person, team, or company can afford to be left behind.
00:01:14.239 --> 00:01:25.359
Here, we dive into the strategies and tactics that our guests use to tackle these challenges and create new opportunities, and how you can do the same in your own organization.
00:01:26.640 --> 00:01:34.719
This episode of Pharma Sessions is sponsored by Exont, makers of the X1 reporting platform.
00:01:35.439 --> 00:01:49.439
On today's episode of Pharma Sessions, I'm thrilled to welcome Frank Sorce, Chief Commercial Officer at UPM Pharmaceuticals and a seasoned commercial leader with deep experience across pharma manufacturing, business development, and strategic partnerships.
00:01:49.680 --> 00:02:02.239
I thought this could be a really cool conversation in that Frank has spent his career helping biopharma companies navigate decisions around development and manufacturing, which is important to any organization, right?
00:02:02.319 --> 00:02:19.360
So we're going to spend a lot of time about talking about selecting the right CDMO, structuring long-term partnerships, and how to maintain a focus on both quality, reliability, while balancing that with price, which of course comes up with all of these discussions.
00:02:19.599 --> 00:02:20.000
All right.
00:02:20.159 --> 00:02:22.000
With that, welcome to the show, Frank.
00:02:22.319 --> 00:02:23.680
Jonathan, great to be here.
00:02:23.840 --> 00:02:25.759
Really excited for this conversation.
00:02:26.879 --> 00:02:27.680
Good to see you again.
00:02:28.000 --> 00:02:28.319
Yeah.
00:02:28.560 --> 00:02:31.120
Two feet of snow outside of my window.
00:02:31.280 --> 00:02:32.319
How's how's your back?
00:02:32.400 --> 00:02:34.159
You do a lot of shoveling over the last couple of days?
00:02:34.400 --> 00:02:37.680
I was on the snowblower for about three hours on Monday.
00:02:37.840 --> 00:02:43.680
I've got two neighbors that just don't seem to be able to do their own driveways in addition to my driveway.
00:02:43.759 --> 00:02:45.680
So I did my good deed for the year.
00:02:46.000 --> 00:02:46.400
That's good.
00:02:46.479 --> 00:02:46.719
Yeah.
00:02:46.800 --> 00:02:53.039
Where I live, there's a lot of retirees, and I did mine, and I helped my neighbor shovel a path to his car and get his path out.
00:02:53.120 --> 00:02:54.560
But after that, that was like four hours.
00:02:54.639 --> 00:02:55.280
I'm like, you know what?
00:02:55.360 --> 00:02:57.280
My I feel like that's all I got in me.
00:02:57.759 --> 00:03:01.680
Yeah, the vibrations in my hands were just about all I can take at that point.
00:03:02.879 --> 00:03:03.439
Excellent.
00:03:03.599 --> 00:03:04.800
Well, thanks for joining.
00:03:04.879 --> 00:03:06.560
And let's just dive right in.
00:03:06.800 --> 00:03:11.199
So you've seen C DMO relationships from both sides of the table.
00:03:11.439 --> 00:03:17.199
Do you want to maybe start by sharing a little bit about your background and then we'll ask some questions about your experience here?
00:03:17.520 --> 00:03:17.840
Sure.
00:03:18.000 --> 00:03:20.319
So I was calculating some things.
00:03:20.400 --> 00:03:24.560
So I'm in my 37th year here of pharma business.
00:03:25.039 --> 00:03:35.599
I started right out of school with Merck Sharp and Dome, spent about eight years in the Merck organization, got my master's in marketing through their education support program.
00:03:36.159 --> 00:03:52.000
And after that stint of eight years or so, I moved on into the sort of the contract sales business, which at that time was a very early Sinios for a couple of years and a very early IQ via, which were under different names at that time.
00:03:52.319 --> 00:03:52.639
Sure.
00:03:53.039 --> 00:03:59.120
And we supported Large Pharma in putting boots on the ground for them, sort of supplementary sales forces.
00:03:59.439 --> 00:04:02.159
And one of those clients was Reliant Pharmaceuticals.
00:04:02.319 --> 00:04:07.919
And I ended up joining them directly here in the Northeast as the regional business director.
00:04:08.000 --> 00:04:14.400
And we started that company, launched it, and then eventually sold it to Glaxo in the mid-2000s.
00:04:14.639 --> 00:04:24.639
And just took a little time off, and then I joined UPM Pharmaceuticals for my first tour of duty as an individual contributor in business development.
00:04:24.720 --> 00:04:28.240
And I also managed the marketing function right from day one.
00:04:28.399 --> 00:04:34.959
So I spent 12 years with UPM, individual contributor, eventually became VP of BD in marketing.
00:04:35.120 --> 00:04:40.079
They had a reorganization around 2019, and I moved on.
00:04:40.480 --> 00:04:50.959
I worked at Synergy Pharma, which is a high-powered CMC medical writing regulatory consulting firm based in Framingham.
00:04:51.199 --> 00:05:06.160
And I started their BD operation in 2021, and I was enticed to come back to UPM the sort of end of 2024, and started my second tour of duty last March 2025.
00:05:06.399 --> 00:05:09.680
So I've seen a lot across the industry.
00:05:10.079 --> 00:05:11.519
So you're you're a pharma lifer.
00:05:12.000 --> 00:05:12.560
Yeah, I am.
00:05:13.279 --> 00:05:14.639
Both sides of the fence.
00:05:14.879 --> 00:05:15.519
That's great.
00:05:15.680 --> 00:05:19.839
So so with all of that history, I'm sure you have a lot of experience.
00:05:20.000 --> 00:05:22.639
It sounds like starting in marketing, right?
00:05:22.720 --> 00:05:27.680
And then moving over to manufacturing and CMC consulting and back to C DMO.
00:05:27.920 --> 00:05:42.000
When a pharma, because most of my listeners are at pharma companies, when the pharma company first begins the C DMO selection process, what do you think are some of the biggest misconceptions they tend to have about how that decision should be made?
00:05:42.399 --> 00:05:48.160
I think some misconceptions are we can do this now remotely.
00:05:48.319 --> 00:05:59.920
We can go online, we can look at websites, we can see ads and journals, we can get corporate decks, and we can do a lot of that vetting from 30,000 feet apart.
00:06:00.079 --> 00:06:09.120
And I think COVID, a lot of people did virtual tours and they said, Hey, we did okay, we made a selection and we're and it's working out for us, but you still got to get to the sites.
00:06:09.439 --> 00:06:10.480
And why is that?
00:06:10.800 --> 00:06:15.759
Because you can only observe so much from a remote location.
00:06:16.639 --> 00:06:23.439
Just pulling into the parking lot of a CDMO, you'll start to make judgment on this organization.
00:06:24.079 --> 00:06:25.360
Is the grass cut?
00:06:25.519 --> 00:06:27.680
Is the security booth in good shape?
00:06:27.839 --> 00:06:29.360
Is the front door clean?
00:06:29.519 --> 00:06:32.240
Is the the mulch kept where it's supposed to be?
00:06:32.399 --> 00:06:38.240
You make these you start to make a judgment as soon as you get on the premises on the property.
00:06:38.480 --> 00:06:48.319
Right through to the meeting room they put you in, through the tour, the meeting of people, all those intangibles are important to the selection.
00:06:48.480 --> 00:06:50.800
And of course, do they have the right equipment?
00:06:50.959 --> 00:06:52.000
Is the place clean?
00:06:52.079 --> 00:06:55.600
Is there all those things that you kind of take for granted?
00:06:55.680 --> 00:06:58.720
But those are all obviously very important in your decision making.
00:06:59.120 --> 00:07:06.079
So you're saying attention to detail in the small things is a good indicator that carries through to the important parts of manufacturing.
00:07:06.399 --> 00:07:10.720
If they don't take care of the small things, how are they going to take care of the big things?
00:07:10.879 --> 00:07:12.720
Is there soap in the soap dispenser?
00:07:12.879 --> 00:07:14.079
Why go in the men's room?
00:07:14.160 --> 00:07:14.319
Right.
00:07:15.360 --> 00:07:21.360
Those little details about the organization will help you in your decision making.
00:07:21.680 --> 00:07:25.439
I'm smiling because I like that maybe this is too much information.
00:07:25.519 --> 00:07:25.920
Maybe not.
00:07:26.240 --> 00:07:29.920
If I go to a restaurant and I go to the bathroom and the bathroom's dirty, I'm like, let's get out of here.
00:07:30.319 --> 00:07:31.360
Like I do not want this.
00:07:31.839 --> 00:07:32.319
Exactly right.
00:07:32.639 --> 00:07:33.920
And that totally makes sense, right?
00:07:34.000 --> 00:07:42.560
Because you need a clean facility where every last detail of the operational manual is followed to a D.
00:07:42.879 --> 00:07:43.680
It has to be.
00:07:43.920 --> 00:07:50.240
So what are some of the, let's say, again, you're in that you're for that pharma company, you're evaluating C DMO partners.
00:07:50.319 --> 00:07:54.720
What are some of the non-negotiable criteria you'd advise that they validate first?
00:07:54.959 --> 00:08:01.040
Thinking things like quality of track record, tech transfer, capability, capacity, supply chain resiliency.
00:08:01.199 --> 00:08:06.079
What are some of some of those important things to take a look at before you even get to pricing?
00:08:22.470 --> 00:08:22.790
Yeah.
00:08:23.030 --> 00:08:24.790
So there's a number of things.
00:08:24.949 --> 00:08:29.590
And a lot of it is depending on, I always say, kind of know thyself first.
00:08:29.750 --> 00:08:32.789
Where are you in the development landscape with your program?
00:08:33.110 --> 00:08:34.870
Your early stage, mid-stage.
00:08:35.110 --> 00:08:36.870
Do you think you have a blockbuster?
00:08:37.029 --> 00:08:40.710
Is it is it a rare disease type product?
00:08:40.949 --> 00:08:42.470
Kind of knowing all those things.
00:08:42.629 --> 00:08:46.470
And the non-negotiables are going to be equipment matchup.
00:08:47.110 --> 00:08:49.830
Done some work here in our own facility.
00:08:49.909 --> 00:08:56.549
Maybe it's bench top, maybe it's into phase one, just a little bit of a GMP operation in your facility.
00:08:56.789 --> 00:08:58.230
Now I'm going to move.
00:08:58.470 --> 00:09:04.950
I want to make sure that the equipment we've been working on is a match for the equipment you're going to be working on.
00:09:05.190 --> 00:09:12.950
I don't want to change the manufacture of the equipment or the mechanism of which it performs its function.
00:09:13.269 --> 00:09:16.629
I really want to make sure I'm dealing with like for like.
00:09:17.029 --> 00:09:21.350
It may not be an exact match, but does the technology match up?
00:09:21.669 --> 00:09:25.110
Then I want to look at your inspection record.
00:09:25.509 --> 00:09:27.669
Where were you last inspected by?
00:09:27.830 --> 00:09:29.509
What are those health authorities?
00:09:29.750 --> 00:09:33.590
What do those inspections say about your facility?
00:09:33.750 --> 00:09:34.470
Did you pass?
00:09:34.629 --> 00:09:36.389
Did you get out of 483?
00:09:36.789 --> 00:09:40.629
I've got to have a clean track record from a regulatory standpoint.
00:09:41.029 --> 00:09:47.669
And then I'm evaluating how are you responding to my inquiry?
00:09:47.909 --> 00:09:50.070
How quickly are you getting back to me?
00:09:50.310 --> 00:09:52.950
How arduous is your CDA process?
00:09:53.110 --> 00:09:59.509
If I can't get the time of day when I'm approaching you or get some, what are you going to do when we sign a contract?
00:09:59.590 --> 00:10:02.149
Right now, bonded to you contractually.
00:10:02.389 --> 00:10:02.950
For years.
00:10:03.590 --> 00:10:04.470
For years, exactly.
00:10:04.549 --> 00:10:04.789
Right.
00:10:04.870 --> 00:10:08.389
I mean, you're not buying a batch, you're buying a relationship.
00:10:08.470 --> 00:10:13.590
And that's going to be a long-term, hopefully, good relationship for both sides.
00:10:13.750 --> 00:10:20.870
So I've got to have that sense that I'm important because if I'm not important today, I'm not going to be important tomorrow.
00:10:21.190 --> 00:10:22.230
A hundred percent agree.
00:10:22.389 --> 00:10:27.990
And things like responsiveness and just I don't know how how you all are structured here.
00:10:28.389 --> 00:10:39.029
It's when I'm talking to people, I know that I'm not going to be ultimately working with the salesperson usually, but I want to at least meet the team of who I'm working with, right?
00:10:39.110 --> 00:10:48.549
And make sure that if I'm thinking this is going to be a multi-year relationship, this is going to be somebody who I trust who I who I can think will have my best interest at heart.
00:10:48.710 --> 00:10:53.029
And yeah, I think getting back to your first point, you kind of have to do that face to face.
00:10:53.830 --> 00:10:57.669
It's not that different from hiring employees, honestly, right?
00:10:57.830 --> 00:11:06.389
Like we do so much, we do so much virtually, but we just need to meet somebody in order to really get a sense of them.
00:11:06.710 --> 00:11:11.750
Yeah, and I I will, you know, in the consulting world, it was very common.
00:11:12.149 --> 00:11:16.070
Say, listen, we're going to need support for this particular program.
00:11:16.629 --> 00:11:20.310
And they'd say, I want to meet the consultants, I want to spend an hour with them one-on-one.
00:11:20.629 --> 00:11:25.669
And you should bring that same level of diligence to the CDMO space.
00:11:25.990 --> 00:11:27.509
Who's my project manager?
00:11:27.830 --> 00:11:30.870
Can I go in a conference room one-on-one and talk to them?
00:11:31.350 --> 00:11:43.590
See what their experiences, see what have they worked on this kind of program before, and you know, really get that, like you say, it's an interview because it's a huge decision for the organization.
00:11:43.990 --> 00:11:53.110
So along those lines, and you would essentially, I think what you were getting at when you were saying, hey, if I'm not going to get treated well before I sign a contract, what's it going to look like afterwards?
00:11:53.350 --> 00:11:58.950
It's sort of how do you separate a sales story from an operational reality?
00:11:59.269 --> 00:12:10.070
So what evidence should these sponsors be looking for to confirm that a site can actually execute beyond audits that you're you pass your slide deck?
00:12:10.310 --> 00:12:10.629
Sure.
00:12:10.950 --> 00:12:16.870
This is you know, these are through conversations, and you may get some documentation.
00:12:17.029 --> 00:12:19.110
We deal in a solid oral world.
00:12:19.269 --> 00:12:22.070
Someone comes and says, Listen, I've got this concept.
00:12:22.230 --> 00:12:25.669
Do we want a modified release version of this particular molecule?
00:12:25.830 --> 00:12:27.269
What have you done before?
00:12:27.590 --> 00:12:41.269
Can you give me three examples of how you worked with a compound that was immediate release forever, and you modified that release rate and gave it sort of an advantage and extended its life cycle five more years?
00:12:41.430 --> 00:12:43.190
And we're going to benefit from that.
00:12:43.430 --> 00:12:45.590
Give me a concrete example of that.
00:12:45.990 --> 00:12:49.350
And if they're vague about it, there's a red flag there.
00:12:49.990 --> 00:12:50.070
Okay.
00:12:51.750 --> 00:12:57.029
We took it in, we did we perform these experiments, we scaled it this way, you use this equipment.
00:12:57.269 --> 00:12:58.389
Here was the outcome.
00:12:58.549 --> 00:13:00.230
They eventually got an approval.
00:13:00.389 --> 00:13:07.830
Whatever that case study is on that particular program, you want to say we've done it, not we can do it.
00:13:07.909 --> 00:13:09.830
And that's those are two different things.
00:13:10.149 --> 00:13:12.629
And is that what you find people ultimately?
00:13:12.870 --> 00:13:17.750
I'm sure you're in competitive situations all the time, and some people select you and some people, some people don't, right?
00:13:17.830 --> 00:13:21.909
But for the ones with when they do select you, is that the reason?
00:13:21.990 --> 00:13:25.029
Is that trust building, or what is kind of the reason that you get selected?
00:13:25.350 --> 00:13:30.149
Yeah, so there's it's a multi-factor decision.
00:13:30.470 --> 00:13:32.470
So is the equipment right?
00:13:32.789 --> 00:13:34.950
Can we grow within this organization?
00:13:35.269 --> 00:13:36.389
Can you scale?
00:13:36.710 --> 00:13:39.190
Take us beyond phase one or two.
00:13:39.509 --> 00:13:43.350
Do you have that experience with this particular modality?
00:13:43.590 --> 00:13:51.190
Have you worked on solid oral and taken this kind of a product forward with these parameters that we're giving you?
00:13:51.430 --> 00:13:54.310
And then, of course, your quality system.
00:13:54.710 --> 00:13:56.310
How is your quality team?
00:13:56.389 --> 00:13:58.070
How do they interact with operations?
00:13:58.149 --> 00:13:59.669
How will they interact with us?
00:13:59.909 --> 00:14:01.590
Can I check some references?
00:14:02.230 --> 00:14:06.230
Those are the, I guess, steps you gotta take in your selection.
00:14:06.549 --> 00:14:10.070
And where does capacity fit into all of this?
00:14:10.230 --> 00:14:19.509
Because I'm sure there's always pressure in a manufacturing business that ownership wants to see more sales coming in, but then you ultimately need to be able to deliver on your commitment.
00:14:19.590 --> 00:14:29.909
So what what do you think are some red flags that farmers should be looking for that a C DMO may be either overcommitted or struggling operationally, even if they look strong on paper?
00:14:30.230 --> 00:14:39.430
I think that you're probably gonna get that sense if it's very difficult to move to next steps in the negotiation.
00:14:39.590 --> 00:14:42.230
Like it took me a month to get a proposal.
00:14:42.549 --> 00:14:43.669
What's going on there?
00:14:43.909 --> 00:14:46.470
I can't get in the facility to do my visit.
00:14:46.789 --> 00:14:48.950
QA audits are six months out.
00:14:49.190 --> 00:14:52.549
All of those are telling me he's got it maxed out.
00:14:52.710 --> 00:15:03.269
You don't want a ghost town when you go there, but you don't want a situation where bins are flying back and forth and you know it looks like chaos in the facility.
00:15:03.350 --> 00:15:08.389
And you know, you want it you want a brisk sense of movement, but not too much.
00:15:08.549 --> 00:15:12.950
But all of those things up front will tell you, hey, something's wrong here.
00:15:13.029 --> 00:15:15.430
They're they're just like I'm not gonna get a slot.
00:15:15.590 --> 00:15:21.110
Even if we consummate this relationship, I'll never get the slots and for manufacturing stuff.
00:15:21.509 --> 00:15:26.310
We'll ship gears here to a little bit of where you think this this industry is headed.
00:15:26.549 --> 00:15:31.590
So maybe let's start to talk about I guess pricing and alternative models.
00:15:31.669 --> 00:15:35.909
So, what's your take on risk sharing or dynamic pricing models and CMO deals?
00:15:36.070 --> 00:15:37.830
Can you describe what that even is?
00:15:38.070 --> 00:15:42.789
And then when they create real realignment, when they become a trap for either side.
00:15:43.110 --> 00:15:46.710
That is a buzz term right now, is dynamic pricing.
00:15:46.950 --> 00:15:52.389
And some organizations, and I think this is Can you define what it is before before getting into it?
00:15:52.710 --> 00:15:56.149
Yeah, yeah it's going beyond fee for service.
00:15:56.389 --> 00:16:08.710
Traditionally, we'd say a bat's going to cost you 50,000, stability time points 3,500, a development report is 7,000, and you got a Chinese menu of everything, and then it's 500 grand, and that's what you pay.
00:16:09.110 --> 00:16:18.870
And with organizations, especially small clinical virtual companies, they can't raise the money they had been raising in the past.
00:16:19.110 --> 00:16:27.190
The last probably three years has been really tight in raising money in whatever fashion you're trying to do it.
00:16:27.430 --> 00:16:29.590
So they're unlimited budgets.
00:16:29.909 --> 00:16:42.149
So they'll say if we can meet these time frames, let's say you can get me in a clinic in three months versus six months, I'll give you a 25% bonus.
00:16:42.310 --> 00:16:48.789
So you'd be 25% cheaper on your price, but there's a kicker that would be worth it to you.
00:16:48.950 --> 00:16:54.870
So those are kind of scenarios that people are talking about right now.
00:16:55.190 --> 00:16:57.190
And what's your take on those?
00:16:57.350 --> 00:17:01.350
Are they effective or is it uh like an overcomplication?
00:17:01.909 --> 00:17:07.349
I think they can be really effective for both sides if they're well thought out.
00:17:07.669 --> 00:17:15.190
Because if I normally get$500,000 for this program, but if it's successful, I have an opportunity to make$550.
00:17:15.430 --> 00:17:22.230
That's another 10% that I normally would not have gotten if I just was a feed for service model.
00:17:22.630 --> 00:17:35.990
Now, certain organizations, if the program isn't successful or they have an adverse reaction that's just so severe they have to stop the program, you could be out a few dollars as well.
00:17:36.230 --> 00:17:45.670
It's a matter of you have to attract a number of clients to be in your portfolio so that you have a vibrant pipeline moving forward.
00:17:45.990 --> 00:17:52.069
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00:18:28.150 --> 00:18:31.509
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00:18:31.910 --> 00:18:34.309
All right, let's jump back into the episode.
00:18:34.630 --> 00:18:41.750
That seems like a really tricky spot to put a C DMO in because I mean, you know if trials fail all the time, right?
00:18:41.910 --> 00:18:46.069
It's baked into the pharma model that only a certain percentage are gonna make it out.
00:18:46.230 --> 00:18:46.549
That's right.
00:18:46.710 --> 00:18:54.470
I'm not so sure that it's baked into the C DMO model that half of your whatever percentage of your contracts are gonna fail out.
00:18:54.710 --> 00:19:01.509
So I would bet you don't really have the medical science expertise on staff to try to make those decisions.
00:19:01.670 --> 00:19:02.470
Not that you even can.
00:19:02.549 --> 00:19:06.069
Like no, no, you don't, and you never seem like a huge risk.
00:19:06.309 --> 00:19:07.829
It is a big risk.
00:19:08.150 --> 00:19:13.670
But if the market prevails in that direction, you have to deal with it.
00:19:13.829 --> 00:19:16.390
You can't stick your head in the sand and say it doesn't exist.
00:19:16.470 --> 00:19:19.349
You're gonna have to say, okay, how we how can we make this work?
00:19:19.509 --> 00:19:24.470
And that's where you you get to the negotiation table and you're trying to make a big deal for everybody.
00:19:24.710 --> 00:19:24.870
Right.
00:19:24.950 --> 00:19:31.750
You're almost like a VC trying to create a little portfolio of uh companies so that if if some of them fall out, you have some successes.
00:19:32.069 --> 00:19:32.789
That's exactly right.
00:19:33.269 --> 00:19:40.789
All right, so then try and think of a way to ask this without getting super super political, and these things are changing by the minute, right?
00:19:40.870 --> 00:19:47.829
But let's just say there's there's all this geopolitical manufacturing reshoring pressure, right?
00:19:47.990 --> 00:19:57.109
And then there's also risk that tariffs may be there one day, may not be there another day, who knows, and who knows what it's going to be by the time this thing even comes out.
00:19:57.349 --> 00:20:12.230
So, how much do you think what are you seeing companies like how much are they factoring that into their decisions around where to manufacture trade-offs between cost, speed, supply chain reliability when they're choosing sites these days?
00:20:12.549 --> 00:20:18.789
I think it's definitely in the thought process should we make this product in the US?
00:20:19.109 --> 00:20:19.910
That's there.
00:20:20.150 --> 00:20:31.190
There were a number of opportunities that we looked at last year where big pharma got our pricing, looked at it and said, we're just gonna leave it where it is, right?
00:20:31.589 --> 00:20:43.430
And wait, we we think that we can do it, and even if we put the tariff in there, it's still less expensive for us to make it ourselves than to use a US supplier.
00:20:43.750 --> 00:20:54.870
It's just not worth it because obviously they do it themselves in a particular country where labor is less expensive than North America, they're gonna have lower margins there.
00:20:55.029 --> 00:20:57.349
It's not gonna be as expensive if they do it in the U.S.
00:20:57.509 --> 00:21:05.349
And when they factor in 10% or 15% tariff, it just makes sense to just hold pat with what you don't.
00:21:05.509 --> 00:21:11.190
There's another contingency that's sort of, for lack of a better term, maybe more patriotic.
00:21:11.509 --> 00:21:17.349
And they're like, Listen, let's do this, let's build a facility here, let's move the product to the U.S.
00:21:17.910 --> 00:21:21.509
United States people work on products that they're actually going to consume.
00:21:21.750 --> 00:21:27.430
And then give them pride in making something, bring that whole concept back.
00:21:27.750 --> 00:21:29.190
Are you seeing that really happen?
00:21:29.430 --> 00:21:29.990
I am.
00:21:30.150 --> 00:21:33.509
I am seeing folks that say, listen, let's do it here.
00:21:33.670 --> 00:21:35.430
Let's get the best price we can.
00:21:35.509 --> 00:21:40.150
And depending on the dosage form, you get a pretty competitive price right now.
00:21:40.390 --> 00:21:43.670
In this solid world, there's a lot of capacity in the marketplace.
00:21:43.829 --> 00:21:47.029
If you're in a antibody drug conjugate, it might be tighter.
00:21:47.190 --> 00:21:49.349
If you're in a monoclonal, it might be tighter.
00:21:49.589 --> 00:21:55.990
But if you can get a competitive price and make it here, some people really want to do that.
00:21:56.470 --> 00:21:57.910
So that's really fascinating.
00:21:57.990 --> 00:22:10.710
I remember this is what they I'm trying not to be overly cynical here, but one thing I remember from business school was a survey where they asked people, I think it was jeans, they're like, how much extra would you pay if a pair of jeans was manufactured in the US?
00:22:10.870 --> 00:22:15.750
And people said all of these numbers, and then then they did an actual experiment to see.
00:22:16.150 --> 00:22:18.150
How much people were really willing to pay for?
00:22:18.390 --> 00:22:19.670
And the answer was zero.
00:22:20.230 --> 00:22:20.789
Different story.
00:22:20.870 --> 00:22:21.029
Yeah.
00:22:21.589 --> 00:22:22.390
Totally different story.
00:22:23.509 --> 00:22:24.069
But it's good, right?
00:22:24.150 --> 00:22:26.470
If people are willing to put their money where their mouth is, right?
00:22:26.630 --> 00:22:35.509
And but I think that the the smaller that delta gets, right, the easier it is to make that business case right to your leadership and increase manufacturing here.
00:22:35.829 --> 00:22:38.150
So let me ask you about another topic, Frank.
00:22:38.309 --> 00:22:43.910
Continuous manufacturing adoption versus traditional batch processes.
00:22:44.230 --> 00:22:48.309
Can you explain what this is and whether this is a trend that people should be paying attention to?
00:22:48.789 --> 00:22:57.269
It's probably been the concept of continuous manufacturing has been talked about for like 15 years, I've heard it.
00:22:57.589 --> 00:23:04.870
And a lot of the big pharma companies would only speak to a CDMO if you had this technology versus the batch.
00:23:05.109 --> 00:23:11.269
The concept, and this is my understanding of it, we've never done that here at UPM.
00:23:11.509 --> 00:23:26.789
So I'm not an expert by any means, but it's just supposed to be a more efficient way of making a product and taking a little bit of risk out of if you make one big batch and it fails, you lose the whole thing.
00:23:26.870 --> 00:23:35.509
And you may have a very expensive active ingredient, and now you're you're out that money, and now you're gonna fight on who's gonna pay for it, whose fault was it?
00:23:35.750 --> 00:23:53.509
The finger point and start, the legalities come in versus a continuous process where you can stop it, got an issue, we only lose a little bit of product or a little bit of drug product, and then it continues, and it's also a little bit more efficient where you're not maybe moving room to room.
00:23:53.750 --> 00:23:58.069
You do your blending here, you do your milling right next to it, right?
00:23:58.309 --> 00:24:11.829
You do your sizing, and now you do your encapsulation or compression, and it's right in not one little room, but a bigger room, but it's all contained there versus moving it to different parts of the facility where there's some risk, obviously.
00:24:11.910 --> 00:24:13.349
Yeah, if you do that.
00:24:13.910 --> 00:24:22.470
So I haven't seen a ton of CDMOs doing that or offering that, and that's just from my vantage point.
00:24:22.870 --> 00:24:29.829
That's this whole conversation is so interesting to me because I spend most of my time talking to commercial people and medical people, right?
00:24:29.910 --> 00:24:32.150
Where it's it's so it's it's a bit.
00:24:32.309 --> 00:24:43.750
I mean, we're talking about data all day long, but it's removed from the actual concept sometimes of like, well, somebody's got to get all this stuff into an actual pill that people can get into their bodies.
00:24:44.150 --> 00:25:00.870
And for me, it seems like magic because one of my strongest college memories in an academic setting is trying to complete organic chemistry labs and just failing over and over to the point where I was like, I'm following the directions.
00:25:00.950 --> 00:25:03.509
I feel like you know, like Harry Potter and Potions class.
00:25:03.589 --> 00:25:05.829
Like I just can't get the thing to work and I'm staying late.
00:25:05.910 --> 00:25:13.509
The TAs are getting like annoyed that they have to pay, and I'm just like not being able to synthesize these things.
00:25:13.589 --> 00:25:24.870
So it really is amazing that you all can do this at scale, at consistency, where somebody can go into CVS at the end of the day, get something, and not have to think twice before they put it in their mouth.
00:25:25.029 --> 00:25:26.630
So it really is it's amazing to me.
00:25:26.950 --> 00:25:27.750
Myself as well.
00:25:27.829 --> 00:25:34.789
You know, when I started on the sponsor side, say, you know, in sales and marketing, you didn't even think about how it was made.
00:25:34.950 --> 00:25:37.269
You're like, what was the inactive ingredients?
00:25:37.349 --> 00:25:41.190
Or you just said, hey, doc, take this uh once a day and your blood pressure goes down.
00:25:41.430 --> 00:25:45.190
It costs uh a dollar a day versus two dollars for the competitor.
00:25:45.349 --> 00:25:50.789
And then when I got into UPM in 2007, a head was spinning.
00:25:50.950 --> 00:25:53.029
About how smart these people are.
00:25:53.190 --> 00:25:55.190
They are in brilliant people.
00:25:55.990 --> 00:26:00.069
And and it also when someone says, Why does it cost so much?
00:26:00.230 --> 00:26:02.069
Why do these products cost so much?
00:26:02.309 --> 00:26:18.870
If you were in the bowels of a manufacturing facility, a development operation, and you saw the work that was being done, this how many sleeves were rolled up, and the intelligence, intelligence of these people, you may think a little bit more about that statement.
00:26:19.109 --> 00:26:19.829
That's fascinating.
00:26:19.910 --> 00:26:23.589
I mean, it really is very it's important work because it it just can't go wrong.
00:26:23.750 --> 00:26:25.750
That's different than a lot of jobs, right?
00:26:25.910 --> 00:26:26.710
Where that's right.
00:26:27.190 --> 00:26:30.470
All right, so let's wrap up with just a couple closing questions here, Frank.
00:26:30.710 --> 00:26:32.630
This has been super interesting for me.
00:26:32.870 --> 00:26:41.430
But looking back across your career, what's one lesson about C DMO selection that pharma leaders can usually only learn after something goes wrong?
00:26:41.750 --> 00:26:47.509
Yeah, I I think the the lesson is defining success up front.
00:26:47.990 --> 00:26:50.150
What are you looking for in the partner?
00:26:50.470 --> 00:27:00.230
You know, what are those non-negotiables that are really important to you, the selection team, and the folks that have to work with the CDMO on an ongoing basis?
00:27:00.950 --> 00:27:03.109
You need to define that all up front.
00:27:03.349 --> 00:27:11.430
And then you need to go out and vet those things and make sure all the boxes are checked that are important to you.
00:27:11.750 --> 00:27:29.349
And you have to go to the sites and see the people, meet the people, and in the end, you gotta use your gut and say, I I think all three of these can do it, but I just have a feeling XYZ C DMO is the right choice for us.
00:27:29.589 --> 00:27:40.470
And then you know, you could always defend that decision-making process if something goes wrong, and you'll you'll sleep at night because you did your due diligence.
00:27:40.950 --> 00:27:42.309
Yes, I love that.
00:27:42.470 --> 00:27:48.549
That's been my take to a number of kind of big decisions where to work, uh, various things.
00:27:48.710 --> 00:27:55.430
It's like if I get bit by something that I wasn't expecting, I'm actually okay with that, right?
00:27:55.589 --> 00:27:58.390
Like I you do what you can, you figure out what you can.
00:27:58.549 --> 00:28:05.750
It's like you never want to go into something with a concern, and then that's the thing that gets you, and you're just like, yeah, I should have listened to myself.
00:28:05.910 --> 00:28:06.309
I knew it.
00:28:06.789 --> 00:28:07.990
I absolutely knew it.
00:28:08.150 --> 00:28:10.309
You don't want to be kicking yourself down a road.
00:28:10.549 --> 00:28:11.109
Well, awesome.
00:28:11.190 --> 00:28:12.069
Well, let's leave it there.
00:28:12.150 --> 00:28:22.710
So trust trust your instincts, do your due diligence, trust your instincts, and you will end up with a happy and fruitful partnership with your C DMO of choice.
00:28:22.950 --> 00:28:25.670
And Frank, thank you so much for your time today.
00:28:26.069 --> 00:28:27.109
Pleasure, Jonathan.
00:28:27.190 --> 00:28:28.069
Thank you.
00:28:28.710 --> 00:28:36.710
This episode of Pharma Sessions is sponsored by Xunt, makers of the X1 reporting platform.
00:28:37.430 --> 00:28:42.549
And that's a wrap on today's episode of Pharma Sessions with me, Jonathan Kaske.
00:28:42.710 --> 00:28:50.710
If you enjoyed today's conversation, don't forget to hit follow or subscribe and share it with someone else in the pharma world who might need to hear it.
00:28:50.950 --> 00:28:58.950
For more on pharma trends, career growth, and business strategies, connect with me, Jonathan Kaske, on LinkedIn.
00:28:59.109 --> 00:29:01.589
Until next time, thanks for listening.
