Building a World-Class CDMO for Reliable Global Supply

An interview with Bobby Sheng, Group CEO & Chairman of Bora Pharmaceuticals

Bora’s Bobby Sheng talks about his vision for the group, and how a strategy of calling on a strong culture aligned on quality has enabled its growth. Sheng’s approach to partnerships is helping the company to expand its biopharmaceutical CDMO capabilities and capacity, and he discusses the importance of scale in responding to geopolitical change, and why he thinks it is important to not lose focus on small molecule therapeutics, and especially the enduring qualities of oral solid dose.

Sheng began his career in pharma sales almost 30 years ago, working in pharma sales for a series of companies in Asia. He noticed the growth in outsourcing but also that many pharma companies had similar problems with their CDMO partners. “There was a huge demand for a different kind of CDMO,” he said, adding that he believed a customer service-based model could replace that of building site capabilities. Importantly, he said CDMOs, “lacked the interaction with the customer and understanding,” of their needs. It was clear to Sheng that a CDMO that was invested in its customers’ molecules and that listened to their needs could differentiate itself. “That was a really basic foundation of what we wanted to build Bora,” he said.

Fast forward almost three decades, and demand for outsourcing is even stronger. According to a report by Bioplan, even in 2022, almost 9 out of 10 biopharma companies relied on outsourcing for biopharmaceutical manufacturing. [1] Sheng cites biotech companies’ need to overcome constraints in time and capital, and to compete as key drivers. “The CDMO market is in its infancy, so we're going to continue to see increases in growth and scale,” he says. “If you look at recent data, the top ten CDMOs only provide about 20% of the market. That's an immature industry, and it's a growth industry,” In a mature industry, the top three suppliers will supply 50 to 60% of the market, and that’s where pricing becomes an issue.” As it stands, Sheng predicts good growth, “I'm very confident that we're going to grow in double digits every single year over the next 10 to 20 years.”

He sees Bora’s mission as helping constrained customers to, “do more with less,” and like others, he wants his company to be “a trusted partner that [biopharma] can rely on.” Customers’ expectations for high quality standards, he says, should not be questioned, and is proud of Bora’s track record, “We have 11 sites and our ‘on time in full’ record is at 98%,” adding, “delivering for the customer is something we think is very important.”

By adding “the brightest minds and the highest capabilities,” and “being very readily available for customers,” Sheng says he hopes biopharma has access to “all the benefits of having an internal site, but not having all the headaches of headcount, capacity utilization, or CapEx issues.”

A Culture of Quality

Sheng sees the combination of quality and culture as a formula that will allow Bora to grow without compromising their high standards. “You have to have a quality culture in order to have really good quality,” he says, adding that at Bora “you're seeing a very consistent quality culture. It's ingrained in everybody.” Bora values are to solve problems first, always be proactive, respect everyone and always to do the right thing. Sheng says that for the last point, it is important to focus on what the right thing is for the customer. “It's much easier to create customer excellence standards, he emphasizes, “once you have a quality culture that works.” Referring to the quality assurance methodologies that Bora employs globally, such as quality by design and six sigma, “You can install the quality systems you need, but you have to have a quality culture for those systems to work correctly.” With sites in Taiwan, Canada, and the U.S., Sheng emphasizes the importance of consistency, reiterating that despite having different cultures, Bora “embeds a quality culture into all of our sites.”

Speaking of the many regulatory body that Bora interacts with, Sheng sees benefits to its consistent approach to quality on its reputation, “Once they understand your company is based on quality culture, they communicate with you a lot earlier with regards to compliance matters.” That assures potential and existing customers, “If you work with a great CDMO, you realize that they're very well respected by multiple regulatory bodies around the world. And we've been able to create that reputation for ourselves.”

You Need Scale Cope with Complex Change

With so much volatility and change affecting our industry, Sheng was asked how Bora is monitoring and adapting to geopolitical change, and ensuring its supply chain remains agile. “We've really benefited from our scale,” he replies, adding that he thinks the industry needs scale. “It's getting much, much more expensive and much more complicated to follow all the government regulations, and that's why a lot of people are looking for CDMOs because they don't have that expertise,”

“We employ global compliance experts and have hired political analysts to explain the environment, so clients come to us to find out what's going on in Europe, in Russia, and in Taiwan.”

Sheng was asked about the U.S. Biosecure Act: “We're seeing a huge trend for other options outside of China-based companies,” but notes that clients are considering their next move carefully and want, “all the benefits of global resources, in speed, capabilities, and cost; the “three points on the triangle.” “We want to have global supply chain that's more consistent, and that's closer to the consumers,” he adds.

“We think scalability is important,” adding that resources, capital resources, human and technical resources to grow the company’s global network.” Bora recently acquired a majority share in Tanvex, and its commercial-scale biologics facility in San Diego, complementing the group’s cell line development and clinical-scale capabilities in Taiwan.

Returning to his earlier point on scale being increasingly important, Sheng points to the ability to host core capabilities, such as regulatory, and have them continually improve their knowledge and compliance and capabilities across the network. “You really can't do that if you have only one or two sites,” he says, adding that it’s “much too costly,” for clients, whereas a CDMO such as Bora can “pool resources of all customer needs and provide top quality compliance and regulatory knowledge base for our clients.”

Large Molecules

Sheng says that Bora is seeing, “demand across the board,” for large molecules, adding that he feels there has been a 2-3 year lull caused by an influx of facilities and capacity, coupled with a cooling of capital to fund innovators. “We overbuild, and then it just takes time for it to fill,” he says, but as 2025 gets underway he is more positive about funding. “We're seeing capital markets realign their interest in biotech and innovator companies,” he says, and adds that the company has seen demand start to increase in the second half of 2024 and the beginning of 2025. In response, Bora sees a need to, “scale up large molecule facilities,” adding that the adding of Tanvex’s facility will provide much needed development capacity.

Bora is seeing, “a resurgence in demand for technology-based complex antibodies, bi-specifics, tri-specifics, and antibody-drug conjugates,” says Sheng. “Once those mature,” he adds, “you're going to see a resurgence of demand for large-scale manufacturing of those technologies. So, we need to be ready when those demands are coming up,” adding that Bora is, “seeing a definite uptick in demand for our commercial-scale San Diego facility.”

Asked about cell and gene therapies, Sheng referred to the need for bespoke supply solutions and asserts that because outsourcers can utilize expensive equipment across multiple client programs, “it's more suitable [for a] CDMO to scale those technologies,” but adds that he thinks the industry has “jumped a little too far ahead,” and needs to pull back. “You're seeing a lot of closures of cell and gene therapy sites, but that's how a growing industry does that,” suggesting that “pioneers jump ahead,” adding that he aspires for Bora to be one such company, “we need those pioneers and hopefully we can be one of those pioneers in the future.”

OSDs: Here to Stay

Looking to the future, Sheng is again keen to emphasize Bora’s “customer-oriented philosophy,” and how the company emphasizes taking the “pulse on our customers and their future demands.” Through its five-year planning committee, Bora foresees that despite much industry focus on large molecules, demand for small molecule treatments and oral solid dose (OSD) will not diminish. “On the contrary, all the research we've done and the customers that we have continue to add need for small molecule OSD”. “Since we bought our first facility in 2013, we've seen [demand for] oral solid dose manufacturing across the world increase.”

Sheng says the company’s decision to acquire the Upsher-Smith facility in Maple Grove, Minneapolis, was a “no brainer,” as it placed much needed capacity on the doorstep of customers with demand for OSD in the U.S., adding that “customers are lining up for that facility.”

He believes that OSDs still provide “the most cost effective and most stable way to deliver the drug to the patient,” and will remain the “Holy Grail” of dose forms for developers.

“We will definitely see all solid dose demand still increasing,” he says, although he believes OSDs will be under rated because of many “sexier” technologies and demands.

“We will always have a foundation for and high quality OSD,” he says, and expresses concern that with neither large pharma or CDMOs focusing on OSDs, “You're going to see a drop in quality, which is what we don't want.”

As well as cell and gene therapies and the new classes of drug, especially biopharmaceutics, Sheng thinks that “Bora will make sure it can supply our customers with high quality drugs, not only in large molecule, but small molecule OSD and other small molecule delivery platforms, including, for example, ophthalmics,” adding “That's exciting!”

Forward Together

Sheng was asked how he thinks partners should make the most of a collaboration with a CDMO. “I think it's really important to have a partnership that focuses on accountability to the client,” and thinks that while many companies talk about partnerships, they’re “done in name,’ and clients should expect to have a single, consistent and reliable source of both information about their program and supply.

“It's very important for CDMOS to not double up resources or capabilities, because that creates a glut of supply,” he asserts, adding that he prefers collaborations or joint ventures to be more than just a combination of capabilities and instead should be focused on the customer’s needs, with each partner invested in the venture and acting together as one. “Accountability is something we focus on for our clients,” and adds that, “when you deal with Bora, you're getting all the reliability of Bora even if we're collaborating or coordinating with a partner.”

“I think it starts with trust,” he says. “Once the customer trusts you, they're trusting you to make the right CapEx investments. They're trusting you when you make the CapEx investments that you're going to be on time to deliver the product that's needed throughout for that CapEx and to be able to scale up.”

Speaking of the long-term partnerships expected in our industry, Sheng says that at Bora “We work with them and understand supply chain needs for the next three to five years,” describing that as “critical” for Bora to be a true partner. “So once again, that trust needs to be built.”

References

[1] 2022 BioPlan Report and Survey of Biopharmaceutical Manufacturing Capacity and Production, 20th Annual Edition