Drive-thru? Online? In person? How to place an order (for your small molecule)

By Kenneth Drew, VP at Flamma USA

When you go online and place an order, you are always asked the same questions. Please provide your name, your address, your contact phone number, and your credit card or method of payment (PayPal, Venmo, etc.). With that said, there are small nuances from site to site.

The same goes for the drive-thru or in person. You are asked if you want additional items or would like to upgrade to a better package. There are always multiple choices to select from. If you choose poorly, you will likely be upset with yourself and begin wondering “Why is this taking so long?” or “Why did they not include that?”. Sadly, now it is too late. Being prepared helps to alleviate this issue.

You would think that all RFPs for a new drug are the same yet there is no standardized template for RFPs. Thus, every innovator company tasks their CMC team to come up with a document to share with prospective CDMOs to provide the information needed to produce a quote. This is one of the first issues that potentially elongates the timeline.

Quick turnaround or a detailed approach? Is it worth the risk?

Clearly, there are some CDMOs that don’t care to fully evaluate the RFP. They run it through a very mediocre review and spit out a number, usually low and agreeable to your timeline, in order to be “fast” and hope to gain the project. They will worry about the details later. Why? Because they know once the PO is signed and the project starts, they can simply gain money back by incisively scope changing the customer. As the timeline suffers, they know you have no choice but to stay there. Meanwhile,
management may begin to question what is taking so long.

On the other hand, there are some CDMOs take a very detailed look at the proposal. They will start by asking for more information. Some typical questions are as follows:

• What indication is this for?
• What Phase is you project at?
• How much material do you need?
• What do you anticipate for the future? Short term/long term?
• When do you need the material?
• How much material have you made and at what scale?
• Do you have tox data on the compound or intermediates?
• Do you have any analytical methods?
• Do you have retain samples?
• Do you have any issues with using China? China + USA? USA + Europe?

The more detail provided initially, the faster the CDMO can provide a quality proposal that will likely have a reliable timeline. Remember, scope changes will lead to longer lead times and thus your project will be late. I have always told customers that my ultimate goal is to never be the hole in your Gantt chart and help you look good to your management team.

Recently, I had a proposal request for a small molecule project that was a typical early stage project. It asked for process development, analytical development, a non-GMP demo batch followed by a GMP batch. We provided several of the above questions to the customer. The customer took over a week to respond with answers thus elongating the time to get a formal proposal already.

In some instances, I will tell a customer that if they can provide a synthetic scheme with rough ideas of amounts and timelines, I can quickly access if the chemistry is doable and the timeline can be met. By this way, we avoid overloading our team to put together a proposal that will be rejected due to the timing. Working this way also allows the customer to not have to put together a formal RFP that takes time on their end. It is a win-win for both parties!

The days of two week turn arounds for proposals is long gone. Sometimes it takes two weeks just to quote the raw materials! It is unfair for customers to expect a detailed proposal in only two weeks. Of course, you can get a proposal as afore mentioned but you will likely pay the price for numerous scope changes.

Another example is a consultant that brought forth a project and sent it to three CDMOs. Two of the CDMOs were located in China. They provided a price of $650,000 and $750,000 for the work to be done on a complicated project that had numerous hurdles to overcome (chromatography to be removed from several steps along with low yielding reactions). We provided a quote in which we were at $1.2 M that provided a detailed investigation as to what we would do and what was expected. The consultant appreciated the detail and agreed with our assessment stating “I know that there is no way that this can be done for the cost quoted from China”. Unfortunately, the consultant was working for a client who was a VC. The VC was concerned with only one thing-cost.

Regardless of what the consultant told the VC client, they insisted on using the lowest cost proposal. In speaking with the consultant several months later, they informed me that the project failed miserably with cost overruns and lengthened timelines that far exceeded our proposal. The project was 6 months late and cost of $1.5M at the end of the day. I often give the advice that you are better suited to work with a CDMO in which you feel comfortable in their proposal and timeline because if you chase a lower price, it usually will not end well.

Is bartering worth the trouble? Remember, this is not a souvenir

Once a customer started with a company we had a long time relationship with. Let’s call this new employee Bob. Bob came forth with an RFP and our team reviewed it and provided a proposal. The proposal provided was very detailed and included the actual number of FTE weeks for each part of the proposal. Bob questioned the timing of several parts of the proposal. We had a TC to discuss his concerns and explain that we had been working with his new company for many years on numerous projects so we had a very good understanding of the timing and needs from our team.

Bob insisted that we did not need that much time. He continued to strongly tell us that we could do it in less time. We politely disagreed. After a couple of weeks of discussion, we acquiesced to his demands and made the changes but also included a more detailed “Assumption” list to be clear as to what we would do. I spoke to Bob and told him that we will do our best but we may have to revisit the proposal later.

The project required much more work than Bob suggested. If Bob would have gone with the original proposal, we still would have gone over the amount of time we proposed but we would have ate the extra time and not propose a scope change as a show of being a good partner. Unfortunately, the amount of time and resources that the project required was far and away too much to swallow. For the first time with this long time customer, I wrote my first scope change to which Bob’s manager was not happy. Bob never questioned a proposal again. Trust is earned over time and should not be dismissed.

What is the take home message?

I had an organic chemistry professor who always closed his lecture with this phrase “What is the take home message?” so I will politely borrow from him and use it here. The take home message is simple- if you want to streamline the proposal process, provide as much information as possible in a clear, succinct way so your CDMO can work with you and provide a quality proposal with a realistic timeline. If you do this, you will shave significant time off the project’s Gannt chart. You will reduce the amount of back and forth emails and calls. More importantly, your CDMO will help to make you look good to your management!

About the author

Kenneth Drew, Ph.D. is the VP at Flamma USA and has been with the Flamma Group since 2010 after being the first employee of Flamma USA. As an organic chemist, he worked in the lab on all facets of drug development including medicinal chemistry, process chemistry and analytical chemistry. He transitioned to business development ~20 years ago and has a strong understanding of what it takes to move a drug through the process to ultimately becoming approved by the FDA and other regulatory agencies. Understanding the supply side of the API marketplace is difficult. He understands how pharma and biotechcompanies work with regards to their supply chain organization as well as their expectations and is willing to be a valued contact in the decision-making process.