Establishing the relationship

Expert tips for working with CDMO partners and contract setting

Once a drug sponsor selects a CDMO partner, certain parameters need to be laid out before the relationship can move forward. Naturally, our experts advise drawing up contractual agreements that outline responsibilities and expectations at the very beginning of the process. According to Bikash Chatterjee, CEO of Pharmatech Associates: ‘Every CDMO has a quality system around it. You need to define the rules around how the drug sponsor interacts with their quality system. For example, if there's a deviation or a nonconformance that takes place during the manufacturing run, are there rules around how the drug sponsor participates in that quality investigation?’

Having these mechanisms clearly outlined from the offset can reduce friction when issues inevitably arise down the line. Stephanie Gaulding, CQA, CPGP, Managing Director at Pharmatech Associates, recommends using current regulatory guidance as a jumping-off point when deciding which responsibilities to allocate to the CDMO. She then advises drawing up quality and master service agreements.

‘I think at the point where you're drafting a master service agreement with a contract organisation, you should be considering a quality agreement at the same time and be putting those in place. Because the reality is that in most well architected frameworks the master service agreement handles a lot of core functionalities - like dispute resolution for example. And instead of creating a different framework for dispute resolution, if you're developing those in parallel you actually have the capability to cross reference between those two master agreements.’

She adds that a quality agreement ‘should work part and parcel with the master service agreement and not separately, to provide clarity when it comes to quality decision-making responsibilities.’ Such responsibilities could include authority to initiate a batch release or batch recall.

‘If you wait all the way to the point where you're launching for commercial to have discussions around regulatory inspections, recalls or those kinds of things that inherently wouldn't be needed until late stage, you may run into new challenges. And you could potentially put your product launch at risk if you can't come to a negotiated endpoint that meets your requirements and your expectations,’ Gaulding says.

‘As I look at that spectrum of pieces, to me it's never too early to start with those agreements, but it really needs to be a pair of them. There really needs to be a master service agreement, or some sort of contractual arrangement, along with the quality agreement.’

Relationship building

One might assume that larger, more experienced CDMOs will have an edge over smaller, newer vendors when it comes to contract negotiation and setting. But several of our experts believe that the vendor’s size and experience matter significantly less than their approach to relationship building. According to Gaulding, ‘It doesn’t really relate to size. I think it relates to their natural views on that relationship with their customers. So looking at it from a standpoint of, how do they view the customer? Is it really just a means to an end for them, or do they view themselves as an integral partnership?’

Building a relationship that facilitates fluid communication and allows for alignment of business objectives is crucial for a successful sponsor-vendor relationship. However, Gaulding says this aspect is often overlooked, even by sponsors with long outsourcing histories.

She says: ‘A lot of folks will focus on supply agreements and quality agreements and I'm not saying that those aren't important, but fundamentally, to be able to modulate your oversight on the supplier, it's about the relationship with the supplier. It's about communication, it’s about transparency, it’s about leadership. It’s about the softer side of the business.’

If you wait all the way to the point where you're launching for commercial to have discussions around regulatory inspections, recalls or those kinds of things that inherently wouldn't be needed until late stage, you may run into new challenges. And you could potentially put your product launch at risk if you can't come to a negotiated endpoint that meets your requirements and your expectations

Stephanie Gaulding, CQA, CPGP, Managing Director at Pharmatech Associate