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Pharmaceutical Manufacturing and Packing Sourcer

Working with Synthesis

Guillermo Morales, Bryan K Roland and Emile Bellott at AsisChem Inc chart the past, present and future for synthesis outsourcing CROs

The synthesis outsourcing field has changed dramatically in the last 15 years, along with the pharmaceutical industry as a whole. In fact, synthesis outsourcing has matured in direct correlation with the strategic plans and changes the pharmaceutical industry has undergone and continues to go through. Now that we are starting a new decade it is a good time to examine the synthesis outsourcing field to see how it has changed and where it is heading.


In the 1990s, combinatorial chemistry (combichem) changed the R&D paradigm of the pharmaceutical industry. A seminal publication by Bunin and Ellman in 1992, demonstrating that solid-phase synthesis could be used for the rapid synthesis of pharmaceutically relevant small molecules, grabbed the attention of the pharmaceutical industry (1). Combichem offered the means to break the synthesis bottleneck, and the pharmaceutical industry did not waste any time in adopting and integrating this strategy into their R&D infrastructure. Significant investments were made in technology to expand or support combichem with the expectation that it would catapult R&D forward, filling the company’s pipeline with a plethora of promising new compounds and release candidates into the clinic very quickly. The race was on to find out who would produce or get their hands on those chemically diverse compound classes that had enough chemical entities to cover and test as much chemistry and biology space as possible in the shortest available time. A new business opportunity had emerged, and many CROs took notice, providing combichem synthesis as a paid-for service and putting compound libraries up for sale.

In time, the pharmaceutical industry realised that compound library synthesis was taking longer than anticipated because of the time it took to develop a robust synthetic route to produce large numbers of compounds – the synthetic timelines increased with the complexity of the compound class, and eventually lacked druggable characteristics. It was not until 1997 when Lipinski reported his study of common characteristics of approved drugs that led to the groundbreaking Rule of 5 (r-o-5) to evaluate ‘druglikeness’ (2). This new observation opened the eyes of the pharmaceutical community as to what must be taken into consideration to design and make drug-like compounds.

By the end of the last millennium, the pharmaceutical industry collectively realised that, more often than not, combichem had been used without the proper medicinal chemistry (medchem) input, and that a great majority of compounds made via combichem or acquired from combichem CROs were outside of the r-o-5 parameters. This shed some light on a major question: why didn’t the compounds acquired through combichem fill the R&D pipelines with promising leads and clinical candidates?


At the beginning of the new millennium, the pharmaceutical industry was undergoing a major transformation, and science was changing dramatically. The human genome was decoded and with it the number of potential druggable targets increased. The kinome field was maturing and the first small-molecule kinase inhibitor Gleevec was approved for human use in cancer, specifically chronic myeloid leukaemia (CML). Computers were getting smaller, faster and more accessible, and software companies emerged with new technologies to support drug discovery.

Medicinal chemistry continued to mature, new small-molecule drug discovery rules were devised to selectively design druglike and lead-like compounds, bioisosteric rules were expanded, cell-permeable and blood-brain-barrier compound profiles were defined, and structure-based and fragment-based drug design were used more and more, among other developments. While combichem continued to be developed, albeit at a declining pace, microwave irradiation synthesis moved to the forefront of techniques to improve efficiency, shortening reaction times dramatically using well-established traditional solution-phase synthesis in combination with automation.

While these changes were taking place in the scientific field, the pharmaceutical industry was also undergoing significant changes. Many big pharma companies realised that their R&D pipelines did not have enough lead candidates reaching clinical trials in the timeframe envisioned to sustain their growth and profitability, which resulted in a trend of acquiring smaller companies with advanced, promising preclinical candidates. However, this approach was not as successful as planned for many reasons including cultural clashes amongst combined personnel, lack of knowledge about acquired projects and failures of advanced compounds. Unfortunately, to overcome these issues, pharma companies simply employed a strategy of acquiring more companies in the hope of solving their pipeline deficiencies.

This paradigm forced them down a path that turned out to be unsustainable for two reasons. Firstly, with the new acquisitions the companies increased in size at such a rate that, in order to remain sustainable, they could only afford to work on potential blockbuster drugs. This decision significantly affected the science pursued since few, if any, resources were allocated to the research of drugs which were only expected to address a small portion of the population (such as orphan drugs). Secondly, overlapping infrastructure and programmes, the high rate of Phase III clinical trial failures, marketed drugs losing patent protection, and the economic downturn have led to an unprecedented closure of plants and facilities along with massive layoffs of highly skilled personnel.

This has led to a time of opportunity and growth for the synthesis outsourcing CROs. Many CROs have emerged from research sites that had been shut down or sold by Big Pharma. A large proportion of the highly skilled personnel that was laid off have found new career opportunities in CROs elevating the know-how, expertise level and services provided by CROs.

As a consequence, CROs have a more in-depth understanding of pharma’s needs, pharma’s expectations of the CROs productivity and technical requirements and have the scientific and project management skills to be an integral part of the clients’ goals and success.


In today’s environment, pharma companies are working in cash-saving mode. They continue to adjust the therapeutic areas that are being targeted and trim down their internal R&D personnel. As a consequence, synthesis outsourcing CROs continue to receive an increasing number of projects that clients are not interested in or are not in a position to conduct internally. An example is Eli Lilly and Co who in 2007 announced that it anticipated it would outsource 50 per cent of its work by 2010. A recent article in C&E News gives an excellent overview of which major companies have acquired or merged with others and the number of personnel to be affected (3).

Not surprisingly, economics are a driving force in the choice to outsource. Countries in Asia (such as China and India) and some European countries (such as Russia) where traditionally low-cost work is offered have been sought for synthesis outsourcing, and have experienced an incremental influx of interest and business. However, low costs are not the only selling point for a CRO to be competitive.

Many synthesis CROs focused on building a solid infrastructure and hiring highly skilled experienced personnel, thus not only allowing them to keep up with the advances in synthesis, medicinal chemistry, computational chemistry and cheminformatics, but also providing excellent problem solving and project management abilities. Other synthesis CROs have added additional services in the life science areas such as in vitro and in vivo biological assays and ADME/Tox in order to expand beyond synthetic services and serve as one-stop-shop CRO centres.

Either of these scenarios presented the opportunity to significantly engage with Big Pharma in larger project capacity, long-term collaborations and IP sharing. As a result, some CROs were in a position to develop their own internal drug discovery programmes. Although starting a drug discovery programme is always a risky endeavour, some synthesis CROs have successfully found a balance between the risk and their finances and have adopted this new business model (such as Albany Molecular Research Inc, Scynexis Inc and Evotec AG) or in some cases abandoned the CRO business model to become pure drug discovery organisations (such as Arqule Inc and Array Biopharma Inc). Other CROs grew their business and client-base to the point that they were the potential acquisition targets for other life science businesses. Some recent examples include WuXi AppTec in China, who in April 2010 announced that it had signed a definitive acquisition agreement with the US based CRO Charles River Laboratories Inc for approximately $1.6 billion (£1 billion). This was along with the acquisition in February 2010 of Argenta Discovery Ltd in the UK by Belgium-based Galapagos NV for $23.1 million (£15.1 million) and the acquisition of China’s based BioDuro by Pharmaceutical Product Development Inc (PPD) in November 2009 for approximately $77 million (£50.4 million).


The world of synthesis outsourcing is bound to change, and so far all indicators point to a promising future. The pharmaceutical industry has shifted from conducting internal research to outsourcing its components whenever possible and economically feasible. Major pharma acquisitions and mergers are still in progress (such as Pfizer-Wyeth, Merck- Schering- Plough and Astellas Pharma Inc-OSI Pharmaceuticals Inc) and more are bound to come. Where there is an overlap, there is elimination (for example of personnel, sites and departments), but while the dust is settling R&D projects must go on and outsourcing will continue. In addition, new start-ups are now going virtual. In many cases the entire research is outsourced, allowing the start-ups to save cash by eliminating costly investment in researchready facilities, capital equipment, full-time personnel salaries and benefits, operational infrastructure, and so on. Now, more than ever, CROs are directly responsible for the success or failure of companies, and being a proven, reliable partner is equally important as the services provided.

The increase in the CRO market is described in a recent report from BCC Research, which indicates that the contract global market in 2009 was around $177 billion (£116 billion) and is expected to grow to around $299 billion (£196 billion) by 2014 (4).

Furthermore, CROs that decided to develop their own drug discovery companies have been successful, with their efforts starting to pay off as their proprietary leads move into the clinic. For example, Albany Molecular Research Inc now has its tubulin inhibitor ALB 109564 in Phase I clinical trials for solid tumours, and Scynexis Inc has its cyclophilin inhibitor SCY-635 in Phase I for the treatment of chronic hepatitis C (HCV) infections.


The impact that synthesis CROs have had in helping drug discovery organisations and big pharma successfully complete projects has reshaped how current and future R&D is conducted. As synthesis CROs find themselves at the centre of research projects as a trusted collaborator, they are not only in a position to complete the technical aspects of projects successfully, but also to help guide projects to the ultimate goal of developing a drug candidate suitable for marketing.

That said, with the expected business volume to be outsourced in the future and the strong position of synthesis CROs in the new drug discovery paradigm, it is safe to say that synthesis outsourcing CROs are expected to grow. As long as they stay sharp, efficient, flexible and close to or ahead of the curve, the future can be bright, promising and rewarding.


  1. Bunin BA and Ellman JA, A general and expedient method for the solid-phase synthesis of 1,4-benzodiazepine derivatives, J Am Chem Soc 114: pp10,997- 10,998, 1992
  2. Lipinski CA, Lombardo F, Dominy BW and Feeney PJ, Experimental and computational approaches to estimate solubility and permeability in drug discovery and development settings, Adv Drug Del Rev 23: pp3-25, 1997 
  3. Jarvis LS, Research recalibrated, C&E News 88: pp13-18, 2010
  4. Swinderman A, Contract research market eyes growth, Drug Discovery News 6: pp32-35, 2010

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Guillermo Morales is the Director of Medicinal Chemistry at AsisChem Inc. He has a PhD and 15 years of R&D experience in big, medium and small pharma in the areas of oncology, CNS, anti-infectives and inflammation involving a variety of biological targets (such as kinases, GST-P1, GPCRs, metalloproteases, and so on). His expertise includes high-throughput synthesis, drug design, lead optimisation, computational chemistry and cheminformatics. He is the Editor-in-Chief of the journal Molecular Diversity, and has co-edited several books, as well as co-authored numerous publications. He holds several patents and has served as scientific advisor and session chair for various conferences.

Bryan K Roland is Director of Project Management at AsisChem. He has over eight years of experience in custom synthesis and life science CROs focusing on development, design and synthesis of both small molecule and large molecules in the therapeutic areas of infectious and neurological diseases. He received his doctorate degree from the University of Arizona and his MBA from the State University of New York at Buffalo.

Emile Bellott is Director of Medicinal Chemistry Services at AsisChem. With more than 25 years of industry experience, his pharmaceutical activities have focused on drug discovery and development, synthesis and design of small molecule therapeutics, informatics and structural biology. He served as VP of Operations, is co-founder of two development-stage biotech companies, and is founder of a life-science software company. Previously, he worked at Johnson Matthey Pharma Services. His operational experience spans medical devices, pharmaceutical development and chemistry outsourcing. He earned a PhD in Physical Organic Chemistry from Harvard and a MBA from the Harvard Business School.

Guillermo Morales
Bryan K Roland
Emile Bellott
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