Christian Merup, CEO of Wellma, explains the winning recipe for successful co-manufacturers in Europe, including the underlying threads and unique capabilities of the leaders in the current CDMO market.
Key insights:
- Focus, flexiblity and IP - combined with high performance - are themes underlying successful co-manufacturers.
- Smaller actors are disadvantaged by lack of scale, whilst larger co-manufacturers have a unique position to affect purchasing prices and reinforce their scale advantage.
- Being able to integrate entrepreneurial companies with deep expertise into a group structure will create a dynamic that combines the agility of a small company with the market positioning of an established player.
- Commitment to high regulatory standards and quality controls, along with investments in digital infrastructure, are all essential to enable this model to reach its full potential.
The current role of the CDMO (or co-manufacturer as we call it) is critical and we expect its importance will continue to grow over the coming decade. We see that there are several different drivers behind this trend, with different sub-sectors of course being affected in unique ways. Capacity constraints and capital expenditure are overall strong driving forces, whilst in some sectors technological advancements and new complex formats have increased the demand for outsourcing.