The Value of Using Contract Packaging Outsourcing in Pharma
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Pharma Tech Outlook: Pharma Tech Magazine

The Value of Using Contract Packaging Outsourcing in Pharma

Stacey Smith, Pharma Tech Outlook | Wednesday, January 06, 2021

Today, pharmaceutical companies outsource their manufacturing, focusing more intensely on specific customers and segments.

FREMONT, CA: Outsourcing packaging to a CPO is a viable and beneficial business strategy that allows pharmaceutical firms to transfer noncore packaging acti

vities to a professional. But not all pharmaceutical drug launches. One strategy leveraged by pharmaceutical companies is to develop cost savings on the packaging end. Using a packaging supplier's infrastructure avoids capital outlays, and it is easier to manage fluctuations in demand at the vital pharmaceutical lifecycle points. The process of drug packaging, which now includes serialization complexities, may not be a good investment of time, device, and resources for a pharmaceutical company.

This means that each part of the pharmaceutical supply chain must play its distinctive role, with each part of it focusing on a vital competency. When supply partner contributes their unique skill and knowledge set, efficiencies evolve. Pharmaceutical firms can choose from various models, including one where the stress on the branding and marketing of the product and outsource functions like research and development, packaging and distribution, and drug formulation. Enhanced supply chain management using each member's core competencies, including the CPO, has helped between 25-50 percent savings for some pharmaceutical firms.

To handle the risk of outsourcing, pharmaceutical companies have to have faith in their partners, with clear communication and complete supply-chain visibility. Technology is powering that visibility. As the pharmaceutical supply chain complies with mandated track-and-trace regulations, the latest IT infrastructures will provide insight into where products are in the system. With variable equipment, floor space, and processes and a trained workforce that can manage various packaging needs, CPOs can offer capabilities and capacity not available in-house to a pharmaceutical firm.

Trust is an essential component in developing a relationship with a partner. Firms can figure out if a CPO has the right equipment and timeframes from their pricing, demonstrating competitiveness and efficiency. It will be based on a CPOs culture that firms will gain the most trusting relationship that ultimately results in supply chain efficiencies.

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