Single-source outsourcing partner offers financial benefits, according to study

Findings from a modelling study performed by Tufts Center for the Study of Drug Development (CSDD) have revealed there are financial benefits of using single-source outsourcing partners versus a multivendor development and manufacturing model.

The study compared the financial impacts of varying contract manufacturing approaches and found that through a single-source model the drug development cycle is shortened, which provides sponsors with financial gains as their products reach market sooner. Figures released from the study showed that by reducing these development times cost was reduced by nearly $21 million after tax and net revenues were increased by almost $24 million.

“Drug development costs continue to rise despite ongoing efforts across the breadth of pharmaceutical and biotech companies to curtail spending,” commented Joseph A. DiMasi, director of economic analysis at Tufts CSDD and principal investigator for the study. “The results of this study suggest potential financial benefits from single-source contracting.”

Additionally, the study revealed that by using a single-source partner the time needed to bring a drug to market could be reduced by an average of 14 weeks.

“Speeding up the drug development cycle not only reduces time and costs for pharmaceutical companies, it also accelerates the speed at which medicines reach the hands of doctors and patients worldwide who are waiting for these life-saving therapies,” explained Michel Lagarde, senior vice president and president of pharma services, Thermo Fisher Scientific.

This study was supported with a grant from Patheon, which is now a part of Thermo Fisher Scientific.