What are CDMOs and why are they important?
Key drivers behind the CDMO surge
Case studies and industry examples
Future of CDMO Partnerships
Preclinical research is crucial for the development of any novel drug. It demands significant resources that are often expensive and inaccessible to biotechnology and pharmaceutical companies of all sizes.
Federal regulations like the Current Good Manufacturing Practices (cGAMPs) enforced by the United States Food and Drug Administration (FDA), European Medicines Agency (EMA), and other international organizations also set specific requirements that these companies must follow for the manufacturing, processing, and packing of a drug product, which may further constrain companies’ operational capabilities.
To overcome these challenges, both pharmaceutical and biotechnology companies often leverage the experience of strategic partners like contract development and manufacturing organizations (CDMOs) to bring new drugs to the marketplace.
Some of the key advantages of CDMOs include their cost efficiency, particularly when compared to the time and investment required to build this type of infrastructure in-house, as well as their supply chain resilience and regulatory compliance.
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What are CDMOs and why are they important?
A full-service CDMO needs to provide comprehensive end-to-end capabilities that support the entire pharmaceutical development and manufacturing process.1”
Recent estimates suggest that the CDMO market in the United States will reach over $278 billion by 2026, with oncology drugs accounting for about 35% of CDMO activity. Rising investments in the CDMO sector are largely attributed to greater complexity associated with the development of novel drugs and medical devices, as well as globalization and emerging markets.
Some key services offered by CDMO include formulation development, regulatory support, clinical trial services, commercial product packaging, supply chain management, quality assurance, and technology transfer solutions2.
One of the key advantages of CDMOs is that all of these services can be offered in a comprehensive package from a single organization, thereby simplifying the drug development and manufacturing process into a “one-stop shop.”
The effective delivery of these services is achieved through a team of staffed and highly experienced scientists and engineers who are actively involved in the development and manufacturing of pharmaceutical products.
CDMO facilities are also equipped with highly specialized equipment and facilities that prevent companies from making large capital investments in developing this infrastructure.
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Key drivers behind the CDMO surge
By serving as strategic partners and providing comprehensive drug development and manufacturing services, CDMOs can help pharmaceutical and biotechnology companies on the journey from discovery to commercialization and beyond.2”
Bringing a new drug to market is a time-consuming process that typically takes between 10 and 15 years, with a total investment of about $2.6 billion USD. CDMOs can reduce costs by accelerating drug production timelines through the use of their expertise to solve formulation challenges and meet regulatory requirements.
The quality of a pharmaceutical product is determined by the safety and efficacy of its active ingredients and formulation, which requires appropriate manufacturing processes that produce the least amount of waste.
Various factors may negatively impact the quality of pharmaceutical manufacturing processes, which can lead to wasted materials, discarded product batches, supply disruptions, and product recalls, all of which are associated with significant financial losses.
Every dollar spent in preventing poor quality is equal to $10 if the problem is taken to production without being addressed and $100 dollars if it moves to the distribution stage.3”
The investment in a reliable CDMO is crucial for ensuring high-quality outcomes and reducing unnecessary costs throughout the entire pharmaceutical manufacturing process.
Partnering with CDMOs at the beginning of the manufacturing process allows pharmaceutical companies to immediately identify and resolve any issue that could lead to significant problems later.
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Case studies and industry examples
In addition to the direct savings associated with CDMOs, these organizations have also been shown to meet growing demands for pharmaceutical products during emergencies.
For example, during the coronavirus disease 2019 (COVID-19) pandemic, Moderna relied on both internal expertise and third-party CDMOs to establish production lines of their novel messenger ribonucleic acid (mRNA) technology in different regions throughout the world to ensure widespread vaccination against this highly contagious disease.
For example, a 2021 expansion in the partnership between Moderna and Rovi in Granada, Spain, facilitated the production of an additional 600 million vaccine doses every year4.
Likewise, ThermoFisher served as a critical partner for supplying raw materials and assisting in vaccine manufacturing of the Moderna COVID-19 vaccine to increase production capabilities.
Future of CDMO Partnerships
As science continues to advance, CDMOs are also expanding their capabilities by investing in new technologies while simultaneously increasing their capacity to produce even more products.
For example, a recent partnership between Samsung Biologics CDMO and Pfizer will involve the investment of almost $900 million USD to accelerate the production of biosimilars for oncology, inflammation, and immunotherapy indications.
Likewise, both ABL Bio and the Lonza Group CDMO have recently announced their plans to develop and manufacture a novel bispecific antibody that will be used to treat both immune-oncology and neurodegenerative diseases5.
Technological improvements in molecule stability and bioavailability enhancements enable CDMOs and their developer partners to unlock new potential medications, making treatments easier to absorb and more accessible to a broader patient base.6”
References
- “What is a CDMO?” [Online]. Available from: https://www.patheon.com/us/en/insights-resources/blog/what-is-a-cdmo.html.
- “CROs vs CMOs, and CDMOs: What’s the difference between the three?” [Online]. Available from: https://www.patheon.com/us/en/insights-resources/blog/cdmo-vs-cmo-vs-cro.html.
- “Transforming CDMO partnerships through a holistic understanding of quality” [Online]. Available from: https://www.patheon.com/us/en/insights-resources/whitepapers/transforming-cdmo-partnerships-through-quality.html.
- “Moderna further expands CDMO partnerships to support COVID vaccine” [Online]. Available from: https://www.bioprocessintl.com/facilities-capacity/moderna-further-expands-cdmo-partnerships-to-support-covid-vaccine.
- “Top 10 Contract Development and Manufacturing Organizations” [Online]. Available from: https://www.genengnews.com/topics/bioprocessing/top-10-contract-development-and-manufacturing-organizations/.
- “Building Resilience: CDMO Strategies for Drug Supply Chain Stability” [Online]. Available from: https://medcitynews.com/2025/02/building-resilience-cdmo-strategies-for-drug-supply-chain-stability/.
Further Reading