Outsourcing Report:
Is your outsourcing strategy sound?
Respondent#2
Lee Buckler
CEO and president, RepliCel Life Sciences our chief scientific officer is employed, and we do a lot of our early stage research in that lab. We use a contract manufacturer for our biologics, and this CMO has tremendous process development capabilities. We also use CROs for the management of our clinical trials, so we don’t have armies of clinical management staff. On the device side, we use contract designers and contract manufacturers. Essentially, we have more consultants and contractors than we do employees. Our reasoning is we aren’t looking to build a multi-generational empire or saddle ourselves with infrastructure; we’re simply looking to play a very important role in bringing key products to market while at the same time creating value for our shareholders. Outsourcing also allows us a lot more flexibility when negotiating strategic collaborations, joint ventures, licensing, and partnerships. Since we aren’t saddled with a tremendous amount of hard infrastructure, it’s easier to turn things off and on much quicker. Geography plays a part here too. We’re located in Vancouver, Canada, and it’s not a cheap place to have infrastructure here, and it has its limitations in terms of talent. If you can wrap your head around managing people virtually, by outsourcing, we’re able to cherry-pick teams to contribute to our projects based on the best available expertise and experience from around the world - not just who happens to be in town. From our regulatory consultants in Boston, our CMOs in Austria and our CROs in Europe, it allows us to bring in top notch people that are more defined by expertise, cost, and experience, rather than by geography.
Q Biotechnology Focus: What do you outsource and what role does outsourcing play in your business plan? Lee Buckler: We’re a biotech company with three cell-therapy products in development called RCT-01, RCS-01, and RCH-01, and we are also developing an injection device for delivery of our RCH-01 and RCS-01 products. Our whole business is driven by a couple of philosophical views. One, we consider ourselves an R&D licensing shop, so we don’t aspire to take any products to market. Second, we want to create high-value assets through to mid-level clinical development and then position these assets into the hands of co-development and licensing partners. With this philosophy, we try to minimize the amount of infrastructure and obligations we have and keep things as flexible as possible - focusing solely on our products. Essentially we are a virtual company, and we outsource almost everything. For starters, we have a contract research agreement with the University of British Columbia, where BIOTECHNOLOGY FOCUS December 2015/January 2016
Q What factors do you consider important when you are designing an outsourcing plan or strategy? That depends on whether you’re talking about vendor selection or managing the outsourcing strategy. Regarding selection, it’s really about who you think has the best expertise and experience and is a good corporate fit. When it comes to management, when you’re so heavily dependent on outsourcing key components, you have to be prepared to do a little more plane time and also find online tools that you can use to help you stay in touch with your vendors.
Q
What are some of the key factors when you go through the vendor selection process? How do you balance the desire to pick the best vs. someone you trust? What’s more important to you? It really depends. In our case, our contract manufacturer came to
