Navigating API Sourcing as a Pharmaceutical Manufacturer

What will your sourcing team do when a challenge occurs with an active pharmaceutical ingredient (API)?

Blog1 1 - LGM PharmaThe API market is growing, so it’s worth considering this question before you’re forced to. The sudden loss of a critical raw material supplier, an unexpected supply chain disruption, or another challenge can derail an entire project. While you’re facing the challenge; the clock is ticking – and your drug development timeline is being delayed.

API sourcing affects every part of the drug development and delivery process, from R&D to manufacturing and patient care. Proactive strategic sourcing decisions can positively influence time to market, drug availability, and, ultimately, patient outcomes.

The bottom line is any mishap in API sourcing can spell disaster for a contract development manufacturing organization (CDMO).

In this post, we’ll explore how CDMOs can empower their API sourcing process and focus on what they do best — developing and manufacturing drug products. For your organization, collaborating with a reliable sourcing partner could be your best move to avoid any potential issues.

Navigating a Complex Landscape

There are many variables associated with sourcing APIs. From strict regulatory policies and supply chain vulnerabilities to cost-effectiveness and intellectual property protection, everything must be considered in order to mitigate risk. These are a few of the considerations your CDMO will need to thoroughly review for each manufacturer before selecting a reliable API supplier.

●     Regulatory Compliance and Quality Assurance Requirements

Blog2 1 - LGM PharmaRegulatory agencies such as the U.S. FDA, European Medicines Agency, and Health Canada

impose stringent API sourcing, manufacturing, and quality assurance guidelines.

  • Compliance With Regulatory Standards: suppliers must adhere to these stringent regulatory standards even when serving a smaller, specialty market.
  • Adherence to Global Quality Standards: Good Manufacturing Practices (cGMP) are critical for maintaining product integrity and safety.
  • Comprehensive Documentation and Traceability: API manufacturing processes must be meticulously documented to ensure traceability and accountability from start to

Navigating the intricacies of global regulatory and quality assurance requirements for each potential supplier can be overwhelming for a CDMO’s procurement department. An API sourcing partner has deep knowledge of all of the moving pieces and can ensure that the suppliers are vetted to meet all mandatory requirements.

●     Supply Chain Vulnerabilities

CDMOs often rely on a single supplier or a very limited number of sources for their APIs. This reliance poses significant risks to timely delivery to customers.

  • Single-Source Vulnerabilities: Dependence on one supplier can be risky if disruptions occur due to raw material shortages, geopolitical tensions, pandemics, or natural disasters.
  • Quality Risks from Materials: Utilizing subpar raw materials not only leads to production delays but also wastes valuable resources.

An experienced API sourcing partner will have established relationships with multiple suppliers and focus on dual sourcing, supplier diversification and scenario planning strategies to mitigate supply chain risks.

●     API Cost-Effectiveness

Development and production of APIs are inherently costly due to raw starting material (RSM) expenses, specialized equipment, skilled labor, and stringent quality control measures.

Achieving a balance between maintaining high-quality standards and managing costs is crucial. Effective contract negotiations and margin management are vital to maintaining profitability while adhering to regulated pricing structures.

●     Intellectual Property (IP) Protection

Intellectual property protection is vital as APIs often involve proprietary knowledge and advanced scientific innovations. These are highly susceptible to imitation and infringement, making robust IP protection strategies necessary. In fact, whether the IP is patented or not, you must maintain secure systems to safeguard sensitive data, employing the latest in data protection and cybersecurity measures.

Savvy Strategy: Partner with an API Sourcing Expert

The level of specialization required to successfully and reliably obtain quality APIs means it can be a smart strategic choice to have a sourcing partner with a proven track record of excellence. How might such a partner help you?

In addition to expertise in IP protection, managing costs and supply chain vulnerabilities as well as deep global regulatory expertise, an API sourcing partner can deliver:

  • Robust quality management systems to ensure that every product batch meets the highest quality standards and facilitates consistent oversight and continuous improvement across all
  • Regular inspections and batch testing to verify that supplier’s products comply with both regulatory expectations and rigorous standards.
  • A broad network of seasoned and trusted suppliers and manufacturers who provide additional capabilities.

Partner with LGM Pharma

LGM Pharma is a global leader in API sourcing, with an extensive network of manufacturing partnerships. Because LGM Pharma is both a CDMO and a reliable partner for sourcing APIs, we’re ideally positioned to help our customers – including other CDMOs – navigate complex projects involving API sourcing challenges.

By collaborating with LGM Pharma, your CDMO can leverage our expertise and strategic partnerships to minimize production costs while maintaining quality.

Contact us to learn more about how we can help you streamline your API sourcing.

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