The Gil Roth Show | How CDMOs, CMOs, & PBOA Are Navigating Through the Uncertainty

How are CDMOs, CMOs, and the PBOA adapting to industry uncertainty? Join Gil Roth on The SCORRCAST as he discusses the challenges, opportunities, and strategies shaping the future of contract development and manufacturing. Gain insights into market trends, risk management, and how key players are navigating change in the pharmaceutical and biotech sectors.

Episode Transcript

(00:00):
Music.

(00:08):
Hello everyone, and welcome backto another episode of The SCORR
cast where we dive deep into themost pressing topics in life,
science, marketing, businessdevelopment and beyond. Today I
am really excited to be joinedby who I consider just a true
expert in this space, Gil Roth.
And I'm going to have Gilintroduce himself in a moment,

(00:29):
but we are going to talk alittle bit about everything Gil
I've often heard in justdifferent recordings of you. You
refer to it as The Gil Show. I'mvery excited to make the SCORR
cast today the gil show, and weare just going to riff. We're
going to talk about uncertaintyin the market. We're going to
talk about the administration.

(00:49):
I'm going to force a couple ofmarketing questions on you about
branding and storytelling, andI'm sure we will, like I said
before, dance around from onetopic to the next. But before we
do that, I think everybodythat's listening to this is
probably familiar with you, Gil,but if not, would you? Would you
be so kind to give us kind of anintroduction, maybe a little bit

(01:12):
of your your background, andthen what I always ask for right
out of the gate is just, whatare you passionate about as part
of this introduction, and thenwe'll jump in, sure.
Thanks so much, and I appreciatethe opportunity to be on the
show. So my name's Gil Roth. Irun the Pharma and Biopharma
Outsourcing Association, whichis a nonprofit trade group that

(01:34):
advocates for the CMO and cdmosector. I founded that in 2014
after about 15 years as thefounding editor of contract
pharma magazine, which was thefirst real trade publication for
the CMO, I'll say cdmo sector.
But we existed before cdmobecame an actual term. And I was
around when it was it wasfounded and popularized. Anyway.

(01:54):
I've been around this spacesince 1999 which isn't possible
because that's 26 years, butsomehow they've added up. What I
do is help represent the cdmosector. Initially, my thought
when launching pboa was to workwith Congress and make sure that
they understood the cdmoperspective. At the time, we
wanted to help negotiate thesecond iteration, second five

(02:16):
year period of the generic druguser fee amendments, and those
user fees will come up, I'msure, as part of our
conversation today, becausethere's a lot going on in that
space. In the process of doingthis, we really got FDA to
better understand theperspective of cdmos. They
really didn't get who we were.
They understood we had the samequality requirements and specs

(02:38):
as in house pharma sites did,but they didn't understand the
business. Didn't understand whatit meant to work as a cdmo with
so many different clients, andto potentially be advancing
manufacturing technologies andplatforms that maybe individual
drug companies wouldn't investin on their own, but from a cdmo
perspective, could be leveragedacross a number of drug

(03:00):
applications. So we worked withthe FDA. In the process, I
learned we also had to work withCongress to help shape
legislation before it ever getsto FDA. And in the process of
that, I discovered I had toregister as a lobbyist with the
federal government, which Ireally did not expect when I
launched this association. Wealso use a lobbying firm in

(03:22):
Washington. I'm based innorthern New Jersey. That firm
keeps us up to date on what'shappening in on Capitol Hill and
in the environs, how thatimpacts our sector. They help me
set up meetings and get down tothe Hill to talk to specific
congressional staffers and helpsocialize certain ideas and try
to advance and advocate the cdmoperspective. And then beyond

(03:44):
that, we've also got a number ofworking groups we built where
cdmos get to talk to each other,and that's really proved to be
really valuable for theindustry. It's something I
didn't expect going in because Ischmooze as part of my my my
nature, and I thought everybodyelse kind of schmoozed and
connected with everybody else.
And then I've realized, no, youguys all have real jobs where

(04:07):
you're in your own silos,working at your companies. And
if I can help facilitate thingsand bring people together from
different cdmos, you can saycompetitors, but they're also
peers, getting them to talk toeach other in an anti trust
compliant way, of course, hasreally proved valuable for the
sector. So it's really thatregulatory, legislative and then

(04:29):
the business advocacy that weprovide through pboa. And it's
something that if you ask whatI'm I'm passionate about, I'll
tell you the origin of thisassociation. The original idea
was I would launch it and handit off to some firm down in
Washington to keep it going, andI would keep working on contract
pharma until whenever. And Ikind of realized a few months

(04:51):
into the idea for thisassociation, after I'd brought
it up with a lot of companies,but. No one cares about these
guys the way I do. I've been toindividual cdmo people's, their
weddings, their kids, highschool graduations. I understood
the red headed stepchild natureof this industry that for so
long, companies would neverreveal that they use cdmos. They

(05:13):
would always say, we make whatwe sell. We sell what we make.
Over time, that has opened up.
But yeah, it occurred to methat, you know, if we hand it
off to some Hired Gun, they'renot really going to care the
same way. They'll get a paycheckand they'll they'll do an
effective job, maybe, but youknow, it might not fit into
their long term goals, and tome, helping this industry grow

(05:36):
and really highlighting theimportance that it has in the
healthcare system. On aprofessional level, that's the
thing that I'm passionate about.
We can go into all the wackypersonal stuff that I do too,
but that's, you know, the sortof stuff that just adds color
and character. So anyway, that'smy over long introduction. Alec,

(05:56):
thanks.
I love it. And maybe the secondhalf of this episode, we're
going to go into the wackypersonal passions, but i There
are a couple of things right outof the gate. I love this aspect
of community within theindustry, and I think that at
times within just the lifesciences as a whole, SCORR

(06:17):
obviously having an emphasiswithin the, you know, the cdmo
side, but also on the clinicalresearch. See our CRO side, you
know, e Clinical Technology,there is a lot of hesitancy
around that word community. Andyet the collaboration is so
important. When you created thisand you started to see kind of
that interest bubble up for hey,I want that community. I want to

(06:39):
have an event to talk to mypeers. Was there any pushback
right out of the gate, or wasthat something that people were
really receptive to? What waskind of that initial response to
building interestingthe the actual, you know,
forming working groups thinghappened while I was at an FDA
public meeting on qualitymetrics. So like 2016 or so and

(07:01):
several of our member companiesquality leads were sitting
around me, we're all waiting.
And then the generic industryspokesman got up and talked
about how their qualitytechnical group had worked on X,
Y and Z, related to qualitymetrics. And I turned to those
quality leads and say, if I goup there and talk about our
quality technical group, willyou guys pretend that you were

(07:22):
part of this? Because we didn'tactually have one until that
moment? And they said, Yeah, weshould launch one of those. And
I said, yes, you're you'reright. That's a good idea. So
getting those people to interactwith each other, just the
quality leads from so many ofour member companies, that's
really been the big success ofthe working groups that we have,
and they have so much to sharewith each other in non, you

(07:44):
know, again, non anti trust,violating ways, non proprietary
knowledge ways. Sometimesthey'll ask questions of the
group during a call. Other timesthey'll ask me to ask on their
behalf, if it's sensitive, maybethey don't want companies
knowing that they're the onesasking a certain thing, and I'll
send back the responsesanonymized too, but it's still a

(08:05):
sign that there's so much forthese companies to learn from
each other, that that's reallyimportant. And like I was
saying, they are competitors,but also peers. Now, the other
thing we do, and it's somethingSCORR Is participated in. We do
an annual meeting every fall,and that is only for our members
and and our affiliate memberscompanies like SCORR that

(08:26):
provide services and goods tothe the cdmo sector. And when I
pitched it to my board oftrustees, there was a little
hesitation, because they're usedto conferences and trade shows
being about businessdevelopment. And I told them,
that's part of it, but this isalso about networking with each
other. And FDA is going to comein and speak, and they're going

(08:47):
to ask questions from you guys.
And it's it is different. Youguys speak differently when your
customers are not in the roomand giving you, you know, a safe
space to talk to each other, totalk to the agency, to talk to
the other subject matter expertsthat we bring in. It's
important. Cdmos deserve a placewhere they're the guest, where

(09:08):
they're not the ones paying forthe exhibits and being locked
out of the conference sessions.
And I, through my 26 years inthe space, I've been to those
shows where, no, no, we're allgoing into the conference room.
Now you guys have to stay outhere in an empty exhibit hall.
You're just paying the bills forus. It's not right. And I make
sure that affiliate members, whosometimes help sponsor the

(09:29):
event, everybody is invited intothe conference sessions. So
giving cdmos Again, that senseof community has been really
important, and they've gotten toknow each other, which is good,
and it's an industry wherepeople move around and the
contacts that they make throughthrough me and through the
meetings, it helps you knowsomebody you've looked at or met
face to face over the big dinnerthat we have, and the networking

(09:52):
receptions, those things build alot of camaraderie and
familiarity within the spacethat maybe in our silos we don't
necessarily have. Of,yeah, I love that. The just
building community, breakingdown the silos is is of
paramount importance. And I kindof jumped in here. I said I
wanted to start at the highlevel before, and now we've

(10:13):
gotten a little granular, but Ido want to take a step back. You
mentioned. So we're going on 11years now, or so of pboas. You
know, in 2014 pretty hectic 11years, different
administrations. We have theCOVID 19 pandemic, and now here
we are in 2025 newadministration takes office in

(10:34):
January, and a hectic threemonths, to say the least, for
lack of a good question here,what's the state of what's the
state of Gill? What's the stateof the industry? Where is your
head at? How are you looking atall of these things that are
happening on an ongoing basis,kind of at a minute by minute
basis, where one update comesin, and maybe it's not going to

(10:56):
be the factual thing, two, threedays later. Where are you at
right now orone day later. Frankly, Sunday
night, there was a Wall StreetJournal piece about how this is
Sunday March 23 there was anupdate on the shape that tariff
policy was going to takebeginning April 2, and by the

(11:19):
next day when my flight backfrom my niece's wedding landed
that had already changed, or atleast been moderated, with
potential for a significantchange in another couple of
days. So staying on top of thatsort of shifting degree of
policy, trying not to, trying tokeep our members informed

(11:41):
without saying things in adefinitive way, sometimes, which
I did early on, when firsttariff policies were being
announced with Canada, Mexicoand China, and then discovered
15 minutes after I hit send,that the Mexico policy had
changed, and six hours later,Canada's was changed. I
recognized early on, okay, thisis the current state of where

(12:04):
things are. Let's, you know,retain flexibility and try to
understand the potential forchange and what some of the
drivers of that might be. So,you know, trying to stay on top
of the uncertainty aspect ofthis, what the goals of this
administration are when it comesto something like tariffs, it's
been important, and it'ssomething that was certainly

(12:25):
discussed a lot during DCad.
Nobody has a definitive answerto these things, but it's a
question of, what are they doingto either retain flexibility or
figure out if X, Y and Z is thecase where the current state of
the situation is, what marketswill we be serving Well, and
what could X percent added toour customers top line through

(12:48):
tariffs impact how they workwith cdmos, or what regions they
choose to either manufacture ormarket in. So that's created a
lot of a lot of uncertainty anda lot of just trying to
understand through largerindustry players as well as
other industries responses wherethings could go. You know, the

(13:10):
automotive industry pushed backvery quickly about the Canada
tariffs because of the amount ofback and forth of parts and
different things that wereshipped back and forth across
the US and Canada borders, andwhat that would mean in terms of
tariffs ultimately hitting usvehicles, there was a

(13:31):
postponement of that, of tariffson those parts being done. We'll
see what the final result ofthis stuff all is, if April 2
turns out to be the big tariffdate this might air after all
that, and everything I'm sayingwill be invalidated by then,
which is part of my point. Froma cdmo perspective, we need to
know what their customers arelooking at, and understand what

(13:56):
some of the drivers are, whatsome of the potential responses
are. One thing I heard from DCada few times was that x cdmo,
cdmos outside the US, seem to belooking at acquisitions of
assets in the US, whether that'sother cdmos or facilities that
might be available ways ofestablishing a US operating

(14:22):
beachhead, basically, which Iassume is meant to at least try
to mitigate some of the impactof tariffs with the ideas of
either moving customers to theirto those us sites, or at least
showing the administration thatyou're investing in the US. So
it does create a great deal ofuncertainty, but it's Well, the

(14:46):
thing that I told FDA back whenwe were negotiating gdufa Two,
this is 2015 2016 the big thingabout those user fee
negotiations were we are not theguys filing the generic drug.
Applications, we were being hitwith very large facility fees as
part of the gdufa one setup,which we were not involved in

(15:06):
negotiating, and the line Isettled on, and it's held up
when we talk to a lot of otherparties, is we don't drive the
bus, but the bus doesn't goanywhere without us. And as
cdmos, that's where we are. Wedon't control the drug
applications. When people ask usabout supply chains, and can't
you make more of drug X, Y or Zfor the US market, we can't do

(15:28):
anything without the licenseholder, but the license holder
can't make the drug without thecdmo. So that's our
understanding of where we are, Iguess in the in the policy
chain. Also because, you know,we do have a role to play, but
we understand that pharma andbio and other parties have a
much bigger role to play when itcomes to helping shape what that

(15:51):
policy looks like.
I love the we don't drive thebus analogy here, but I also
know, you know, none of thesethings can happen in a quick
manner, right? So we talk abouttaking a customer from Europe or
Asia Pacific and then trying tobring them into a facility in

(16:12):
the United States. This isn'tsomething that happens
overnight, right? And transferregulatory processes, etc, could
take years, right? The the thebig knock, and this, this
something that goes back to theBiden administration, and I've
talked about it, and there havebeen public comments, so I'm not
giving away anythingproprietary. Under the previous
administration, there was a amulti country, in this case,

(16:36):
five country slash region,attempt to figure out alternate
supply chains for drugs that arecurrently solely sourced from
China. This was, again, publiclystated goal, so not giving
anything away. We're notsupposed to talk about who was
in the room, or even admit thatwe ourselves were in the room. I
was in the room. I got invited.
It was during bio. I was invitedone week before. It was the

(16:59):
first time an email showed up inmy box with nsc.gov as the
address, and I thought, boy, Ididn't think the National
Security Council knew who I was,and I'm not super happy that
they do, but, but I was invitedalong to this, this meeting,
which was again, five regionstrying to figure out, what if
you took, like the any of theessential medicines lists that

(17:22):
are out there, the US or theEuropean Commissions or the
who's and maybe identify 20really critical ones and figure
out how to source thosecompletely outside of China.
What would it take? And thething we've been talking about
with supply chains throughoutyou know, even before COVID In
2019, we were involved in somenational security conversations

(17:45):
with the Senate and the Houseabout this, the commodity
generic APIs are really thethings they're concerned about,
and those are not things you canmove quickly and easily to other
regions. And again, we're moreon the dosage form side than the
API side with pboa, but we haveenough companies that are also
API makers, even the smallmolecule space, that they

(18:09):
recognize what the value chainslook like, why they evolved the
way they did, why certain thingsare made solely in China, and
it's a major challenge to buildAn entire chemical
infrastructure and all theenvironmental issues, health
standards, just wages, etc, thatmake it much more likely to be

(18:30):
made solely in China. So tryingto move all that stuff to the US
or another region becomes amajor challenge, and it would
involve years and years ofinfrastructure building to get
there. So when there'sdiscussion about onshoring and
trying to bring everything backhere, it's really a question of
what you're trying to bring backand what the timelines would be

(18:52):
like, what the economics wouldbe like. A lot of the key
starting materials would stillcome from other regions.
Excipients, largely are going tocome from China and other
countries, while, and this issomething that that's come up in
recent years, while excipientsare incredibly important to the
pharma industry for all of oursolid dosage drugs, the pharma

(19:15):
industry is not super importantto the guys who actually make
those ingredients forexcipients, which are largely
food grade products, and it's amuch bigger market for them than
Pharma. So telling them, oh,hey, can you move all your
operations somewhere here forthis thing that only accounts
for a small percentage of youryour market isn't really a
starter, but without excipients,same thing, they don't drive the

(19:35):
bus. Bus doesn't go anywherewithout them. So you still need
a supply chain that's able toaccommodate those nodes that
simply cannot be moved toanother site. There does need to
be a lot more understanding ofhow many drugs are sole sourced,
not just within a singlecountry, but for a single

(19:56):
facility. And this is somethingthat's really come up,
especially on the generic side.
Yeah, and again, it's more APIside, but FDA has started to put
together their map somewhat fromthe reporting amounts bill that
came out during the Cares Actback in 2020 but also through
existing data they've had foryears and years, through generic

(20:16):
drug applications and drugmaster files that companies
might think that they aresourcing from different API
facilities, and turns out,they're all coming from one API
facility, and that's not safe.
Ultimately, you know, fivedifferent generics are all
getting the API from the samesite. That means, if that site

(20:37):
goes down, all of thosedifferent providers are out of
the market, and that's when wethink that having five different
generic companies for a singledrug is robust. It can turn out
to be just as fragile as havingonly one. So anyway, that's part
of the globalization and supplychain rejiggering that is at

(21:00):
least part of the goal of thecurrent tariff policy and some
of what we're looking at, again,from a dosage form perspective,
we really do try to highlightthat the US has a lot of
capacity for the important typesof meds, and that we're making
the pills, tablets, files,syringes, pre filled syringes.
In the case of the GLP oneclass. There's an awful lot

(21:22):
that's going on in America. Wedon't need a gigantic incentive
structure to cause morecompetitors to come into this
space when there are certainaspects that are very well
served in the US already.
Yeah, that was a it was a fiveminute answer.
And there was actually substancein there, though, right? Oh,

(21:42):
there was so much substance.
But just to, just to bring itback, even into the
conversations that we're havingon a day to day basis, it makes
sense why commercial leaders,marketers, business development
teams. There's this sense ofanalysis, paralysis of Who do I
talk to? What do we do? Becauseof all of this uncertainty and

(22:03):
being able to prepare for sixmonths from now, 12 months from
now, let alone 1824, that fiveyear picture kind of feels like
you're just closing your eyesand throwing darts, and there's
really not a way to be able,like you said you could make a
decision today that isirrelevant in the world that

(22:24):
we're living in in tomorrow or,let alone a couple of years from
now. And that's that'sstressful. It's stressful.
See the the innovator side, ifyour customers as a cdmo are
primarily innovators, there'ssome more more flexibility built
in because there's more moneybuilt in, right? When your
customers are commodity genericsfirms, or at least you're

(22:46):
accommodating part of thatmarket, they cannot take a risk.
Yeah, let's make a second sourcefor this product that we only
sell for a penny a tablet.
That's right. It becomes very,very difficult for them. So
yeah, they have a lot at stake,and there's a lot of patients
who rely on these things, whichis, it's paramount we always

(23:08):
kind of elite or lied over thatwhen we're talking inside the
industry, because we allunderstand the patient is
absolutely right, tops. But I'vediscovered in recent years that
people actually listen to thesepodcasts outside of industry, so
sort of important to make surepatients, 90% of prescriptions
in the US by volume, aregenerics. So making sure that

(23:29):
that market is served, evenwhile the margins on it are
tiny, and there's going to be agreat deal of pressure if you
start putting tariffs on theirinputs or on the countries that
they're being exported from,that's something that could
potentially have significantimpact on patients going
forward.
And we talk impact, we've kindof gone down the tariff and some

(23:54):
of those regulatory pieces youmentioned, and you kind of
teased out the user fees aspectof this, and I've heard you talk
about this before in differentconversations, you know, maybe
even in the newsletter, if I'mif I'm remembering correctly,
just in terms of what thatimpact is going to have from the
FDA perspective. Not a goodquestion here, but give us the

(24:15):
rundown of where we're at there.
Well, I'll tell youwhat's at stake now, as I
mentioned earlier, all the majoruser fee programs, it's
prescription drug, generic drug,medical device and biosimilars,
those four majors, all the userfee packages come up for
reauthorization every fiveyears. The over the counter
monograph one was that that wasenacted as also part of that

(24:38):
cares Reporting Act. And that'sof a slightly different timing
because of the year it gotinstituted, but they're looking
to sync it with the other four.
So the user fee packages consistof industry and FDA sitting down
to to negotiate commitments onFDA part, usually centering
around review timelines fordrugs, but also for issuing.

(24:59):
Guidance on certain types ofdrugs, or in some cases, on the
FDA side, getting supplementalfees to improve its it capacity
and to hold some programs and toincrease some of the meetings
that they hold with drugapplicants, as well as being
able to hire inspection staff.
But the upshot of all that isthese commitments yield what FDA

(25:23):
is, what the expected timelinesfor a drug review are not an
approval, but a review. Now, inthe PDUFA case, for the
innovators, they were at a pointa few years ago where 96% of
NDAs and BLAS did receiveapproval in their first cycle. I
don't know where that number isright now, with generics, it's a

(25:44):
much lower first cycle approval,but they have improved the
median time to get a genericapproved. But the thing is, all
of those commitments on FDAside, the things they agree to,
they come back to industry andsay, Okay, this is how many full
time equivalents or FTEs willneed to hire to meet those
goals. And industry comes backwith that's that's more FTEs,

(26:09):
because every FTE equals acertain fully loaded dollar
amount, and that carries throughyear upon year, and the user
fees and inflation comes inevery year and increases the
cost per FTE, and that's whenindustry figures out, okay,
we're not this one wasn't as biga priority. We don't need that

(26:29):
those FTEs added, but we do needthis other category, and that's
going to equal 10 more people inthe program, or this many more
reviewers at CBER, blah, blah,blah, and that means that all
the user fees are based on FDAability to hire and retain
personnel, and with some of therecent issues that have occurred

(26:54):
through government streamliningof the workforce, industry has
To make sure they have faiththat FDA will be allowed to hire
and retain personnel under theuser fee acts going forward,
these staffers, these FTEs, arehired with user fee money, so
it's not taxpayer funds that arepaying for them, but we need to

(27:18):
make sure that we trust that FDAcan Do this as we head into the
user fee negotiations, in ourcase, pboa will be at the table
for gdufa, but the other majorsthere again, PDUFA, Basu and
medufa, I'm sure their industrygroups are also making sure, or
trying to talk through with FDAand potentially Congress, that
if we negotiate these fees, Weknow that FDA will be able to

(27:42):
hire and retain people, forexample, with the training
aspect of things we know. We'vebeen told that for the
inspectorate at FDA, it's abouta year and a half after being
hired that they're able to acttheir new inspectors are able to
inspect a site on their own.
They need significant trainingto be onboarded. And with that
initial wave of firings thattook place, or workforce cuts of

(28:06):
everybody who'd been zero to twoyears at various agencies,
right, a lot of tumultuousnessand a lot of lack of
productivity is you can't getthese people up to speed. So we
want to make sure we haveassurances that user fee staff
will be, will be kept, thatthey'll be, you know, not
subject to any sort ofstreamlining. As part of this,

(28:31):
40% of FDA is budget does comefrom the medical side, user
fees. I believe another 6% comesfrom the tobacco industry user
fees, but that's a separatesettlement. So it's we're ready
for negotiations. This fall,we've already been working with
our counterparts at AAM andtalking with FDA and developing

(28:52):
our data call questions inadvance, as we do every five
years. But yeah, it's theuncertainty that was created at
the beginning of theadministration regarding the
federal workforce that canultimately impact the entire
sector, not just enrollments ascdmos, because, as I mentioned,
all those user fees are tied todrug review timelines. And if

(29:14):
you're a small R and D companywith your one product with an
NDA or bla and all of yourinvestor money is hinged on,
okay, your PDUFA goal date forthat review is date X. That
gives you some businesscertainty and some structure.
And if this model falls apartand industry can't rely on fixed

(29:38):
goal dates going forward, thatcould create a lot of issues
when it comes to R and D,productivity, willingness of
investors to put money into thisspace, etc. So it's something
we're certainly keeping an eyeon. It's not something we
directly impact from the cdmoperspective, but something that
will directly impact us if thatpredictability of reviews is

(29:59):
affected and that. Way, yeah.
Side note question here, how doyou, before we even get into
I've got a couple of questionsabout cell and gene therapy and
marketing, how do you on a dayto day basis, skill maintain all
of this, you know, we talkabout, I asked the question
about passion and interest, andyou know, I can tell that this

(30:22):
is something that you could talkabout for another four hours,
way too long. On this farlonger, right? I'm also trying
to be diplomatic in my language,so my number one keys, as I tell
people, and as I was justsaying, with a one of my
trustees right before this call,because he's in the same boat as
me. I don't have children. Ihave no social life really, and

(30:42):
I don't drink. So those arereally three things that that,
you know, have helped me be muchmore productive, or at least be
able to retain all this stuff,because I'm not worried about
sending somebody to college atthis point. Yeah, it's it is
challenging trying to figure outnot just what is happening, but
what is under what is happening?
And it's not just talking aboutthis administration, but my

(31:04):
experience of the last 11 years,figuring out what somebody
actually is saying as a subtext,or what the tensions and
dynamics and drivers are forsome of their decisions that,
again, from a cdmo side, wemight have limited perspective
into, but learning how to tobetter read other people and
then retain all that and sort ofbuild a mosaic. That's that's

(31:28):
what I do. The other big thingis tooting my own horn, the my
ability to do all this stuff,not just the retaining it all,
but the fact that people willfill me in on important things
that are going on that aren'tnecessarily public information.
There's a good deal of trustthey have in me and my the good

(31:49):
will that I have in this sector,really, people will share things
with me, knowing that it'll helpme put together a composite idea
of what's going on withoutviolating their trust. You know,
I can start to build a idea thatI can share with others without
saying Company X told me thishappened, and it helps they my

(32:10):
role in that way kind of helpsthem have somebody they can
validate some of these theoriesand observations with and see if
customers are hitting othercdmos with the same sorts of
questions or demands withoutasking things that could be
potentially anti trusty. So ithelps them, you know, better
understand where things arecoming and going without having

(32:32):
to find out exactly whichcompany is doing X, Y or Z. So
yeah, it's a lot of work, but,you know, it's better than
putting out a magazine. I figureI love it. It's, it's all a
testament to to the work and therelationships over the the last
26 years. So I it's, it'sfantastic. You know, even just
seeing it firsthand, I do. Iwant to pivot a little bit so I

(32:56):
consider myself an outsider inin the industry. I've been at
SCORR for four years. Came inaccount strategist, working with
our clients on a day to daybasis, have moved over to
business development because Iwouldn't stop talking. And Leo
was was tired of it when Istarted couple of clients right
out of the gate that I'm workingon are selling gene therapy, and

(33:17):
I couldn't read a newsletter oran article in 2021 that was not
cell and gene therapy, cell andgene therapy, and it felt like
there was a lot of momentum. Andnow what we're hearing from our
strategic advisory board, fromour clients, and just the
industry as a whole, from ourside, is, hey, maybe we're
taking a step back on on celland gene therapy. Maybe we we're

(33:38):
going to divest that portion ofthe business. So we're going to
move away from that. Can yougive me a little bit of an
insider's update on on what thatcell and gene therapy landscape
is and maybe what's causing someof that slowdown? Yeah,
so first, and this is somethingI've talked about. Let's see
2023 was the first time Ibrought this idea up in the

(34:00):
press conference during cphiBack in Barcelona, which I'll
get to in a moment. The this notour industry as cdmos, but the
larger pharma and biopharmaindustry. There have been
buzzword sort of investor crazesover my time in here, and

(34:23):
something that had come up forme in relation to cell and gene
therapies was antibody drugconjugates, which similarly went
through a period of intenseInvestment and Development and
buzzword craze had some clinicalI don't want to say failures
exactly, so much as slowdowns.

(34:44):
Things took longer than theyexpected. That led to investor
lack of faith, people pullingout, et cetera. Then the science
and the clinical data started tobear through. And as I put it
back, in fall of 2023 youcouldn't go five minutes
without. An ADC agreement beingmade, and the market finally
caught up with the successesthat occurred on the clinical

(35:08):
and scientific side of things,as well as the manufacturing
end. I think we see somethingsimilar with and cell and gene
therapy are two very differentthings, and there are ways of
breaking those down that arevery, very different within
them, but as a catch all,whatever. So within the cell and
Gene space, I think one of thethe the clinical side still has

(35:30):
to catch up. I think investorexpectations were too high for
how quickly return could happen,and the COVID era warped a lot
of things, as far as what thethe timelines could look like
that changed the way clinicaltrials were done for a bit, etc,
with cell and Gene You also havethe issue of reimbursement,

(35:52):
which in the US, driveseverything. And if your drug
costs two and a half milliondollars per dose, this is going
to change how things are handledon the insurance side, what
patient uptake is like. Andwe've seen companies that have,
like bluebird bio, for example,had two or three approvals in

(36:14):
this space for effective drugs,and I've gone out of business.
Basically, bluebird sold forabout $30 million recently to
some private equity firms. Wasvalued at one point at, you
know, 10 billion reimbursementsbeen a huge factor in this
stuff. I think you know thatstuff will get worked out as the

(36:38):
medic as the the therapiesthemselves produce a great deal
of long term savings. One of theissues is simply Insurance
Company X is on the hook for twoand a half million dollars for
this drug, but the patient isprobably going to be at
Insurance Company y5 years fromnow. So why should we at x pay

(36:59):
for this when all the bills thatwould have been covered if he
wasn't doing this are going tobe paid by insurance company.
Why it's heartless and, youknow, very mathematical way of
looking at this stuff, but thatseems to drive some of the
reimbursement issues within thisspace. You know, reliability,
understanding the durability ofsome of these drugs, is also

(37:20):
open ended and ensure insurersdon't want to put up huge
amounts now and then discoverthree years from now that, oh,
the effect actually waned, andthey're going to need another
dose, or they're no longereligible for a dose because of
a, you know, the viral vectordelivery system for some of
these things. And as such, youknow the those old medical bills
that you thought were nevergoing to occur. Now we're going

(37:42):
to occur the model that I alwaysgo back to, and this is pre cell
and gene therapy is still sovalid from Gilead, which cured
hepatitis C, had you literallygot rid of the disease. It
wasn't a you'll need to takethis for the rest of your life.
It was, I think 12 weeks oftreatment, and insurers and

(38:06):
Medicare etc balked because itwas $80,000 for a course of
treatment. On the flip side,these people were not going to
need liver transplants, whichwould cost you a lot more than
$80,000 but that short termfinancial hit governed some of
the uptake with this stuff,especially on a governmental
side, and especially within theprison population, where
hepatitis C was rampant, andagain, somewhat heartlessly,

(38:30):
there was a do we need to givethese guys this drug? It's very
expensive, which wasn't cool.
Over time, there were moreentrants into the market, the
cost fell for that reason. Butstill, it's, you know, that the
dynamics of reimbursement andthe economics in the US drive a
lot of this stuff. And Ibelieve, like I said, that cell

(38:51):
and gene will advance. Therewill be much more financially
sustainable models goingforward. It's going to take a
few years to catch up, and bythen, we'll be talking about how
AI never worked out and became abuzzword that everybody threw
money into with no ROI, butthat's just me editorializing.
So I, as everybody asks,I love the I love the

(39:14):
editorializing. Um, youmentioned the buzzwords. It's
something that I from amarketing, branding, positioning
standpoint, have picked a bonewith, and I think we have a
mutual connection that alsorefers to this as the the sea of
sameness, and that if you throwbuzzwords out there, and we try
to be everything to everyone,all at once, and hey, if you, if

(39:38):
you name it, we can do it typeof approach. You know, you think
that that's a positive, but asmore and more competitors are in
the market, it's not going to bea positive. You're not going to
stand out. I'm curious the AIis, is one on the clinical
research side. We were just at atrade show in February where.

(39:59):
Yeah, the amount of times I sawdata driven insights had me
ready to lose my mind, becausewe've been doing data driven
insights for a lot longer thanyou think. It's not just because
we have an AI tool to utilize itso, so I'm just curious, what
are your thoughts on this topicof conversation,
pre AI, it was all big data. Ifyou remember that it was the

(40:23):
giant data sets are going toyield all of these, these great
insights, especially for drugdevelopment and clinical trial
results. So they put a newbuzzword on it, with AI. We know
it's actually machine learningand not AI. That's right,
driving this stuff, but that's athat's not a sexy buzzword. So
we need to use AI now from astrictly from a cdmo
perspective, there are, Ibelieve, benefits within that

(40:48):
machine learning landscape orpredictive analytics for
manufacturing processes thatseems to be the application that
could actually be beneficial themore data you have on
manufacturing of certainmodalities or particular
products, whatever, the the morethe machine learning algorithms,

(41:12):
whatever can look through thatdata and start to see, oh, when
this starts to go out of spec,that's when you know, six weeks
after that, you start to get afailed batch. Let's start fixing
that stuff early. Now, a chunkof this stuff is still dependent
on the data being collected inin structured formats, having
enough sensors to pick up onthese things, which is much more

(41:32):
the province of the continuousmanufacturing guys like Fernando
Muzio out of Rutgers with a lotof the I've heard them say up
meetings, there should besensors in every single tablet
press, because the more data youbring in, you will be able to
start getting some of thosebenefits and returns from the
problem is a lot of those thingsare those low, low value

(41:55):
commodity generics that Ibrought up earlier. And
increasing cost through moretechnology is not something they
can really viably invest in. Butstill, that seems to be an area
of application for this whole AIand machine learning landscape,
when it comes to the cdmo side,that said, it's all dependent on
significantly huge amounts ofdata, as well as, again, the

(42:17):
reliability of that data, ifeverything's collected on paper,
going to be tough trying to getall that stuff into spreadsheets
that this the systems can read.
And if you're talking about verysmall run, small volumes of
products or super specific,personalized medicines like the

(42:38):
cell and Gene space, you'reprobably not going to generate
the sorts of data, the amount ofdata you need to reliably use
machine learning, where thehuman eye is basically going to
pick up on these signals too.
So, you know, there's a lot ofpromise to me. It's not just in
pharma. The whole AI thing hasfelt like a giant bubble from
the beginning, and I'm waitingto be proven right on this one,

(42:59):
but I don't have any money in itone way or the other. So, you
know, I can put it out. I'mwith you on the marketing side.
I think that there for me, Idon't go as far as to say that I
am anti AI in marketing, becausethere's somebody listening to
this that thinks that I shouldbe really deep in AI, and they
could be a potential client. Butit's, it's, I think it is very

(43:23):
similar to that, that bubblethat you are referring to, okay,
before, before we wrap up, I dowant to ask kind of a I was just
getting started. I know you are,I know you are, but I only have
an hour on your calendar, and Iknow how busy you are. I go
along afterthis. I have to write a 25
minute presentation fortomorrow, but this will help. So
I lovethat well. And this is, this is

(43:43):
going to air next week, sopeople who are listening to
this, this was April 3, maybe,hopefully I'm a dad by then. I
don't know if I can wait twomore weeks. Yeah, we'll see. But
I am curious, you know, we talkabout the sea of sameness, one
of the things that I talkedabout on a podcast a couple of

(44:04):
months ago, going to CP h iNorth America. CP h i worldwide.
You're going to see a lot of thethe same language being said by
different companies right now,whether that is on the hey,
we're a full service end to end,one stop shop, or, you know, if
you think about, you know, aspecific niche within, like,
sterile, fill, finish, there's alot of this same messaging

(44:27):
that's being utilized. From yourfrom my perspective, this is,
like my enemy number one, andwhat I'm trying to solve. But
from your perspective, howimportant is it for these
companies to have a story thatactually helps them stand out in
in 2025 is that something, forlack of a better question that

(44:47):
should be a focus for theseorganizations right now, with
where we're at today, what areyour thoughts around marketing
and messaging as it pertains tojust the market as a whole?
Sure, it's you. The it's arelationship driven business.
Still. You know, when I startedout, it was like this, before I
knew what any of therelationships were like, I came

(45:07):
in with no knowledge of thesector whatsoever. But it turned
out, person at cdmo X used towork at in house Company Y, and
there was trust at in houseCompany Y, Oh, this guy wouldn't
be selling us bad cdmooperations, you know, let's work
with them. The we'll talkparticularly about like the
sterile fill finish space. Youknow, we fill vials, we fill

(45:30):
cartridges, we fill syringes, wehave pre filled syringes, etc.
How do you differentiate? Youknow, it can be track record. If
you're a company like GrandRiver aseptic manufacturing.
Johnson and Johnson came to youduring COVID and operation warp
speed. You manufactured for themwithout a fail. They also
handled the Bavarian Nordicmonkey pox vaccine. They've done

(45:53):
a lot of other projects outsideof those two pandemic responses
or epidemic responses, but thatshowed a track record,
certainly, and the technologythey have in their site, they
can show off and really wincustomers through that sort of
thing. And there's a story inthat respect another let's see
cdmo, who joined as a startup,but has continued, and they're

(46:17):
bringing in their customers nowin cog biopharma. I think of
them, a bunch of the guys whowere the founders of that were
veterans of Cook, pharmaca. Theyhad a track record within the
sector from their time at Cook.
I think that helped when it cameto work. We brought the team
back together. We're launching anew cdmo in the sterile, fill,

(46:37):
finish space you worked with usbefore. We're going to build
something that is, you know,purpose built from the ground
up, you know, for thismarketplace. And that, I think,
was very, very strong messagingfor them, beyond the technology,
quality levels and everythingelse. I think there was a
personal connection that peoplecould make in the sector and
understand, you know, who theseguys were, if you had longevity

(46:59):
in the space for someprocurement guy who's cycled in,
cycled back out, things aregoing to be different. You're
going to be looking at a bunchof pricing metrics, quality and
compliance, and then yousomewhat fall into that sea of
sameness thing. It might just begeography and available capacity
that dictates your buyingdecision. But really, I think
having messaging, having theability to show that, you know,

(47:20):
we're not just filling files.
We're guys you've worked withbefore, or people who are
investing in X level oftechnology, or have, you know,
these relationships with certainpotential client companies or
governments as the case may bethat that helps when it comes to
some of the messaging, but,yeah, it's very difficult. I
remember in the magazine daysthat one magazine, one cdmo,

(47:45):
started advertising with a photoof one of their their people,
and a little quote andtestimonial from them, and
within six months, like 10 othercdmos had the same style of AD,
and it was like, yeah, it's nothelping. You know that you just
picked up on one guy's thingthat worked, and now you're all
replicating it. That's not, youknow, gonna help anyone make a
buying decision one way or theother. So, yeah, it's still a

(48:07):
significant challenge. But Ithink the the relationship
aspect of this thing, and it'spart of why DC cat is the
success it is, right? It'scompanies that do the legwork,
that sit down and have thosemeetings. You're not standing in
a booth, you know you're you'retalking about, and you are
walking through hotel lobbiesand bumping into people that you
know, you've known for years,but needed to connect with and

(48:28):
have a little conversation and afollow up with, yeah, that's,
that's the which are breakinginto the space. That's the big
challenge is, you know, where doyou get to the point where you
you have those relationships andyou're comfortable with
everybody, and you can makethose calls and get people into
the room.
Yeah, it's the meaningfulconversations. And that's where
for us, a lot of times, we'lllook at what's the story that we

(48:51):
can tell that fosters thosemeaningful conversations. And if
you are just checking the box,and everybody else is just
checking the box, it's going tocome down to, well, I actually
know somebody at this company,or this is a little bit easier,
and now you start to become, forlack of better terms, a little
bit of that commodity of just,okay, we're just going to go
with who checks the most boxesfor us, versus having you know

(49:12):
that that actual interest inworking with the company that
has it has a different story.
Okay, that's why, during ourlast conference, or in person
conference in October. Weactually, yeah, we had SCORR and
two of its peers, notcompetitors, peers, sit down for
a panel to just talk aboutmarketing and what we've

(49:34):
learned. We did one of thesevirtually end of 2020, I think
before the vaccines had rolledout, we had a SCORR and one of
its peers and two of our memberssit down for a panel just to
talk about, how do you marketwhen no one can go anywhere,
there's no trade shows, youcannot bring someone to your
facility. And as we said at thetime, it's not like catalent or

(49:56):
thermo had an advantage, likethey couldn't secretly. Fly
people to their site when no oneelse, no one could do this. How
did you change? And this wassort of a follow up, just
getting guys to those guys andthe customers in the room to
talk through. You know, what didyou learn? How things change?
How do you decide what shows areimportant to go to? And how do

(50:17):
you again, get that messagingacross at a time that there's a
great deal of need, the R and Dmix is changing in certain ways.
You have something like GLP onesthat's totally bending the
capacity that's out there andutilization of certain types of
modalities and delivery systems.

(50:38):
And what do you show that you'reyou know, you're in that space,
you're active, you're available.
It's something we mentionedgeography earlier, but it's
funny that two of my startupcompanies in cog in Fishers,
Indiana, and Selkirk in Spokane,Washington, neither of those are
on the beaten path exactly. Butif you build a good facility,
and you have a good story, andyou can, you know, show that we

(50:58):
can make this stuff, we're herefor you, will support you beyond
just the units that are beingturned out, it's meaningful, but
you do have to get in the doorand be able to prove that. And
again, the INCOG guys had agroup track record that really
helped them as part of theprocess.
Yeah, and that's been theirwhole story, too. We're very

(51:18):
familiar with the INCOG team,and that's been the story that
they tell on a consistent basis,is that team that they've
brought together, and they'vedone a really nice job of that
as well. Okay, Gil, this hasbeen, I feel, I feel four times
smarter. Anybody that'slistening to this is going to
feel four times smarter. Ireally appreciate you being able
to take such a complex andevolving landscape and be able

(51:42):
to talk about it in bite sizedpieces. Listen,
I'm just happy. This is thefirst podcast I've had to do for
industry in about a year wherenobody's brought up bio secure.
So I'm just happy. Basically, Ihad it. I had it on an asterisk
to the side. I had it on anasterisk. That'll be a follow
up. Yes, we'll do that. We'll dothat on the next episode, last

(52:03):
minute or so here, obviously I'mgoing to link to all the things.
But where can people consumeyour content? You know, is it
LinkedIn? Is it the website?
Where can people find you overthe next couple
we do have a website, which is Ireally need to update, and it's
pharma, bio.org, but if you goto LinkedIn and look up the
pharma and bio the pboa,basically the pharma, biopharma

(52:24):
outsourcing Association. You'llfind the group there. I'm on as
Gil Roth. You can always look meup and connect and I post. I do
a newsletter every Friday, whichyou can sign up for through the
website, and that I put in ourmember news, other outsourcing
news, key articles, guidances,other things that are coming out

(52:45):
that impact our sector. And thena wacky part near the end, where
I write about what I've beenreading lately, which everybody
seems to dig. So the newsletteris really a good thing to get
that recurring. This is whatpboa is up to. This is what's
going on in the the industry andand to be able to get a little
more intelligence as to, again,what's going on outside your
silo. Yeah,I love it. What have you been

(53:07):
reading lately? Give us a sneakpeek. What have you oh,
gosh, let's see. I just finishedstill pictures on photography
and memory by Janet Malcolm, aposthumous collection of essays
on her part, the big, great oneI finished a couple of weeks ago
is the twilight of Bohemia. Thisbook about this place in

(53:28):
Manhattan called West Beth thatwas converted Bell Labs,
buildings on the far west WestVillage, like down right by the
West Side Highway or 12thAvenue, 1969, or 70, it came
online as affordable artistshousing in these like five or
six buildings that are combinedtogether. And it's survived 55

(53:50):
years. Unfortunately, when thecity and the foundation putting
it together started theapplication process for this
stuff, they didn't put a timelimit and how long anyone could
stay there. So they createdaffordable housing for artists
in New York, and didn't quiterealize some of them would stay
there the entire 55 years sinceit was founded. But it's a neat

(54:11):
history of that and some of thepersonalities and the artists
who live there. This is all partof Gill secret identity stuff,
which if you ever Google myname, you will find before pboa,
and then your mind will beblown. But yeah, this book is
really fascinating in terms ofwhat New York was like in the
70s and 80s as this, thishousing was taking off, how the
art world changed, what it meansto raise kids in a world a

(54:36):
couple of buildings surroundedby writers, painters, all
different types of artists. It'sa really fascinating book. And
actually went to the book launchduring DCAT down at West Beth.
My friend Peter was the author,and Tuesday night was the launch
party. I'm like, you know, I've,I've just finished nine hours of
meetings. Why don't I take thesubway downtown and pick a one
guy in a suit who shows up tothis, this, this book launch,

(54:59):
and we had a really nice. Thisevening there, before I headed
back to my hotel and dive backinto DC cat the next morning. I
love it, the wacky world of GilRoth's all the GIL show. Like we
say, it might just be theepisode title for this episode
of The SCORR cast Gil I can'tthank you enough for taking the

(55:20):
time, shared all of yourinsights with us. That'll do it
for another episode of The SCORRcast. I know if you listen to
this, you found this onevaluable. Make sure that you
subscribe. Leave it a five starreview on Spotify. You can now
leave comments, and so you canleave a comment for Gil.
Certainly reach out to him ifyou have any questions, connect

(55:41):
with them and really, really,really pay attention to the
newsletter and the consistentupdates that him and the team
are putting out until next time.
Gil, thank you so much. Thankyou. It's been great.

(56:02):
As always, thank you for tuningin to this episode of The SCORR
cast, brought to you by SCORRMarketing. We appreciate your
time and hope you found thisdiscussion insightful. Don't

(56:27):
forget to subscribe and join usfor our next episode. Until
then, remember, marketing issupposed to be fun.