Holding a steady course through troubled waters

Half a decade into the 2020’s, the world finds itself in a turbulent era, to say the least. This is true geopolitically and financially, not to mention the natural disasters that rock the boat for people and businesses worldwide. Instability hits the life science sector hard. The sector’s dependence on large volumes of risk-willing capital, a highly trained and mobile workforce, and stable regulations makes it particularly susceptible to uncertainty. Thus, words like “de-risking” and “stability” are appearing more often than ever and have a soothing ring to them, not least for investors. 

During the early days of COVID-19, the uncertainty of what was happening in the world caused a momentary halt in investments in life sciences. This defied all logic, one might argue, as life sciences were clearly pivotal in addressing the pandemic. But that is how we humans operate – uncertainty makes us pause and analyze. It’s like when we see a car crash in the opposite lane of the motorway. We slow down out of precaution even though there is nothing preventing us from maintaining our speed in our own lane. 

It’s not a bad thing to pause and analyze factors of risk and instability. But in these times of constant uncertainty, how can we develop coping mechanisms that enable us to keep moving forward? No decision, after all, is also a decision. And slowing down can also create risk, such as cars bumping into you from behind. The one thing we have going for us this decade is, science – especially life sciences. For that we must not slow down. 

So, in these times of default instability, how does one navigate a steady course through troubled waters? I decided to take a closer look at the decision-making process in a part of our sector that is highly dependent on long-term stability – where wrong decisions can be detrimental: manufacturing plants. 

I toured three continents to gain exclusive insights from professionals in the manufacturing industry who are responsible for long-term strategic decision-making. Meet the Indian company Aurigene Pharmaceutical Services, and AGC Biologics with its growing presence in the Nordics, the Swedish up-and-coming CDMO Diamyd Medical, and various other representatives from the ecosystems in which they are physically located.

Spotlight India

At BIO-Europe 2024, a magnet for companies all across the world to come to Stockholm, I sat down with Aurigene Pharmaceutical Services. This is a company that has spun out of an Indian pharmaceutical company and initially established its manufacturing operations in India. However, recognizing that biomanufacturing is now global, Aurigene’s Global Commercial Head Roger Lias points out that the company serves patient populations and customers worldwide. “Good Health Can’t Wait”, he says, which is why their manufacturing is now located across three continents. Proximity is clearly relevant to navigating uncertainty. But it’s not the only factor, according to Lias.

“Our clientele includes pharmaceutical multinationals and biotech start-ups across the US, Australia, Europe, and APAC. While proximity to clients’ clinical trials is advantageous, non-geographic factors are also crucial in our manufacturing decisions. Compliance and access to a skilled workforce are essential to quality and good science,” he says.

Lias continues to describe the decision-making process, broadening the context to include both economic and political factors, in Aurigene’s case opting for India.

The current geopolitical landscape, including the Biosecure Act in the US, is prompting companies to reconsider their strategies, weighing up on-shoring or near-shoring against the economic incentives of manufacturing in regions like China and India. Global CROs and CDMOs are preparing for potential tough times ahead.

“After achieving the global standards demanded by customers, economic factors become significant, making our Indian location advantageous. The current geopolitical landscape, including the Biosecure Act in the US, is prompting companies to reconsider their strategies, weighing up on-shoring or near-shoring against the economic incentives of manufacturing in regions like China and India. Global CROs and CDMOs are preparing for potential tough times ahead,” he says.

Spotlight Northern Europe

Up north in Sweden, in the city of Umeå where you are more likely to catch a glimpse of the Aurora Borealis than sunlight during the winter months, Diamyd Medical’s Chief Business Officer Sofia Mayans gives me a warm welcome.

Going against the outsourcing trend that has increased among biopharma companies recently, Diamyd Medical made the strategic choice to build up in-house manufacturing capabilities for their own product Diamyd (rhGAD65/alum), a disease-modifying antigen-specific immunotherapy for the preservation of endogenous insulin production. This decision was accompanied by the choice to become a CDMO themselves, as a way to de-risk the investment of building manufacturing capability. 

Sofia Mayans, Chief Business Officer, Diamyd Medical. Photo: Fredrik Larsson

As Mayans explains the rationale behind their strategy, it’s obvious that proximity was a crucial factor. And with proximity comes a certain amount of control, according to Mayans. By running the manufacturing of their own product, Diamyd Medical can oversee the supply chain and ensure timely operations. 

“Umeå might seem like an unlikely place to establish a manufacturing facility, but we think it’s a great location! The university and the vibrant innovation ecosystem in Umeå provide us with the excellent skills needed for establishment and production at the plant. We were lucky to find a suitable building in an area where other companies in the drug development field are also located, which opens up opportunities for future collaboration,” she says.

Ultimately, it’s about finding the right balance between operational control and market access.

Location was key to Diamyd Medical’s decision to establish in-house manufacturing, as Mayans explains: “We saw the need to better control quality and efficiency while minimizing supply chain risks. However, a manufacturer farther away can still be a valuable partner if their facilities are near key markets. This distribution of service, expertise, and availability can make partnering with us as a CDMO a strategic advantage for companies looking to access specific regions. Ultimately, it’s about finding the right balance between operational control and market access.” 

Crossing the bridge to Denmark, just in time for Medical Valley Alliance’s (MVA) annual event I listened in on the CEO Anette Steenberg’s reflections on why this region is seeing so many newly established CDMO plants. In summary she attributes it to the strength of the life science ecosystem as such, along with a welcoming public sector system that offers interesting business incentives.

But quality of life cannot be forgotten here. After all, being in a region that attracts talent is a critical parameter in biopharma manufacturing localization decisions, Steenberg argues. And the metrics seem to agree with her. MVA is not only the most innovative region in the European Union, it is also seeing the fastest increase in the number of CDMOs. Could it have something to do with the productive work ethic yet with a sustainable work-life balance? 

Before answering that question, this story makes a stop in London, where I met up with Tracy Humphries, Director of Nucleic Acids and Nanomedicine Marketing at Cytiva. We meet in a café in Spitalfield market and immediately we dove into supply chains, how they were affected during the pandemic and what is ultimately at stake if supply chains fail. 

It begins with transforming relationships that are historically transactional into connections where suppliers become value-add partners working toward shared goals with their customers.

“COVID-19 brought about years of supply chain instability. Despite there now being a greater focus on securing global supply manufacturers still face numerous issues, from the complexity of workflows for next generation therapeutics to economic challenges. Failing to cope with these can prevent life-saving medicines from getting to the patients that need them. We must give serious thought to how to deal with supply chain complexity better, not just for the financial health of the industry but most importantly in the interest of the health and lives of patients,” she says.

“It begins with transforming relationships that are historically transactional into connections where suppliers become value-add partners working toward shared goals with their customers,” she adds.

I wonder whether we have become any better in securing supply chains since the pandemic, and if strategies have changed for manufacturing companies. Humphries believes so.

“One of the key lessons learned during the pandemic was the risk of over-reliance on foreign components for drug production, with countries having lower gross national incomes reporting shortages. This has led to companies, such as Cytiva, investing in local expansion projects to help produce supplies closer to home. In the last year, we’ve opened new manufacturing facilities in India, Canada, the US, Switzerland, and the UK,” she says.

Helena Strigård (author) together with Tracy Humphries, Director of Nucleic Acids and Nanomedicine Marketing, Cytiva, in London.

Spotlight US – from London to the Pacific Northwest

As the plane descends towards Seattle, the stunning combination of snowy mountains and the Pacific Ocean opening up in front of me keeps my face glued to the window. For the next few days I attend AGC Biologics’ CMO Summit 2025, where thought leaders and partners from around the world meet to discuss trends, innovations, and advancements impacting the biopharmaceutical market. I’m lucky to get a moment with President and Chief Executive Officer Alberto Santagostino and Regional Vice President for the US Isi Agbato, to ask for their perspective. The focus of their conference is exactly what I am investigating –  how to hold a steady course in unstable times. 

Santagostino immediately explains their strategy in his introduction talk. Stability is at the heart of AGC Biologics’ offering, and it comes in the form of trust, he says. As CEO of the company he has dedicated time to infusing the brand with friendliness.

“Building trust is essential to us and is reflected in everything we do. It’s about being a safe harbor for clients, combining the upsides of being that large player with a robust track record with a friendly, non-intimidating interface to clients,” notes Santagostino. 

Our industry has faced more complexity these last few years. Chemistry Manufacturing Controls (CMC), technological development, and manufacturing have all been a headache for the biopharma industry, especially when dealing with CDMOs.

I ask, “How do you achieve that, being the friendly partner? At the end of the day, your corporate muscles in negotiations are enormous compared to most of your customers, how does that play out in negotiations?”

“Our industry has faced more complexity these last few years. Chemistry Manufacturing Controls (CMC), technological development, and manufacturing have all been a headache for the biopharma industry, especially when dealing with CDMOs. A friendly approach means providing the expert services needed to solve these technical problems while being collaborative, reliable, and stable, eliminating steep price expectations and transactional or confrontational relationships. Combining this friendly approach with our network’s scientific expertise and capabilities creates a better relationship that biopharma partners can rely upon,” adds Santagostino. 

To be that reliable (and friendly) CDMO-partner, AGC Biologics themselves demand reliability. To that end, the geopolitical stability of site locations is also paramount importance, according to Santagostino. With eight manufacturing plants across the US, Europe, and Japan, the global distribution itself builds corporate stability. More importantly though, each site is located in places where the various risks have been assessed as being at a minimum and where access to key resources can be secured. These locations are Seattle, Longmont and Boulder in the US, Yokahama and Chiba in Japan and Milan, Heidelberg and Copenhagen in Europe – places that are also attractive to the highly mobile local and global talent. So clearly, Anette Steenberg at MVA was right in placing value on the softer elements in attracting human resources to a certain location. 

Turning to the US region, I bring up the supply chain again, following the discussions in London with Tracy Humphries. This time, I am speaking with Isi Agbato. She has led supply chain management in Latin America, Europe, North America, and now in the US. Her job is to ensure undisrupted supply from the US to the global market, ultimately securing consistent delivery of treatments to patients across the world. “Resilience” is the word that our conversation gravitates towards. But what does it mean? 

Very quickly, Agbato’s passion for anticipating, adapting, and recovering from disruptions becomes apparent. We spoke about her experience across several continents, the portfolio of diverse suppliers, partners, and collaborators she has amassed over the last two decades. One thing is clear, just like Humphries, she now thinks of supply chain in terms of “before COVID-19” and “post COVID-19”.

She risk-assesses just about every strategy to secure supply and delivery. As she puts it, “there is an urgency, delivering on time and in full is the goal, someone’s life is waiting on the products we make”. Agbato engages the entire E2E supply chain expertise from tracking demand, planning and procurement and manufacturing, until the product leaves the warehouse for its destination. Moreover, she is a fan of having contingencies as a way to ensure resilience. 

She also introduced the idea of sustainability. But not as a separate concept. Wherever appropriate it is woven through the governance, environmental and social mechanisms of the entire supply chain.

This reflection by Agbato sparks so many more discussions on the broader link between sustainability and resilience. But this topic will have to be explored in another article. Time to head back to Sweden and put all the bits and pieces of this travel log together.