Contract Packaging Organisations (CPOs)
Pharma packaging has traditionally been viewed as an extension of manufacturing services provided by CDMOs, many of whom are seeking to offer full-service manufacturing solutions to their customers. However, CPOs are taking a prominent role in the market due a number of factors including increased demand, the increasing complexity of packaging requirements as more innovative products are brought to market, and new and more stringent packaging regulations introduced across multiple territories, including serialisation.
CPO activities can broadly be divided into:
- Packaging - the development and production of:
- Primary packaging (e.g. blister packs, bottles, syringes and inhalers)
- Secondary packaging (e.g. boxes and cartons)
- Tertiary packaging (e.g. crates and containers
- Labelling and Artwork Management Solutions (LAMS)
Although a small segment of the market it is undergoing substantial growth, primarily as a result of increased regulation in the industry, including serialisation and anticounterfeit legislation.
A number of recent trends are reshaping the CPO industry and the pharma supply chain more broadly, with early adopters of technology and efficient and environmentally-friendly processes continuing to gain market share as partners of choice.
A continuing trend in the CPO industry is the adoption of postponement packaging to improve efficacy and reduce wastage. Traditionally, CPOs would provide bulk packaging of single products for specific markets, which would then be shipped to the market and stored until required. This approach often results in high inventory costs and significant levels of wastage when products exceed their shelf-lives.
Postponement packaging, however, involves the late-stage customisation of blank packaging, meaning CPOs can react quickly to market-specific demand while reducing wastage and inventory storage costs. The large number of languages globally, combined with the increasing levels of packaging regulation, are likely to further increase the adoption of postponement packaging by CPOs.
Serialisation legislation introduced globally, including the Drug Supply Chain Security Act (DSCSA) in the US and the EU’s Falsified Medicines Derivative (FMD), has resulted in the introduction of mandatory barcodes on pharma packaging and the transfer of large volumes of data in the supply of medicines. The legislation has forced pharma manufacturers to reconfigure their operations, often at significant cost. This has meant that many manufacturers have struggled to meet the 2019 enforcement dates of both the EU is FMD and the DSCSA. Although the industry is still struggling to come to terms with the implications of serialisation, it has the potential to create a more efficient, safer and integrated approach to bringing drugs to market, and will likely have a long term impact on the pharma packaging industry. Despite the rapid pace of technological developments in the broader pharma industry, the pharma supply chain is significantly behind in terms of digitisation, with paper-based processes the norm in many organisations. Partly as a result of serialisation, the industry is increasing its digitalisation of data in the supply chain, which provides opportunities to implement automated processes and increase efficiencies.
The reduction in the use and wastage of plastic across the pharma supply chain in favour of more eco-friendly and biodegradable packaging solutions will continue to be a trend for the foreseeable future. An example of this is the increased use of the recyclable polyethene terephthalate (PET), which can be broken down to molecular level and converted back into PET, in pharma packaging. Broader operational improvements across the pharma supply chain (including postponement) will not only improve profit margins but reduce wastage across the world, reducing the environmental impact of the industry.