CMC Outsourcing Advisory


A biopharmaceutical company with a compound in Phase 1 development sought a partner for outsourcing the microbial fermentation of the Active Pharmaceutical Ingredient (API). Upon selecting a proposal – which included analytical transfer, development activities, piloting and validation of the API manufacturing process – the company engaged Danforth’s Clinical Business Operations team for a financial assessment. Recognizing our subject matter sourcing expertise, the client expanded the project to include a technical review as well.  Our team examined the technical portion of the 80-page draft agreement as well as the cost proposal – aiming to improve negotiation of terms such as liability limitations, financial savings and robustness of the operational process.

Danforth Role

Working closely with the client team, Danforth contributed to a successful negotiation by:

  • Performing a full review of the provider’s proposal for the microbial fermentation of the API, including technical and commercial elements
  • Highlighting areas for clarification, adjusting the scope (particularly for analytics and pilot runs), and negotiating price for the pilot batches from CHF 1.5-2.5 mm to CHF 1.35-1.75 mm
  • Reviewing the second project addendum to the Global Framework Agreement (GFA), including:
    • adjustment of wording to mitigate risk and to challenge price where applicable
    • reduction of client’s liability exposure with respect to the provider’s subcontractors
    • waiver of fee for rescheduling a GMP batch within a given timeframe
    • reduction of cancellation fee
    • reduction of financial exposure during failed drug product batch caused by provider
    • decrease of handling fee for resins from 8% to 2%


The cumulative impact of these steps is expected to save our client more than $2 million, demonstrating the power of sector-specific insight when it comes to contracting and negotiation for outsourced drug manufacture.