Pharma Sessions

Why the Small Details Reveal Everything About Your CDMO Partner with Frank Sorce

• Jonathan Kaskey • Episode 32

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In this episode of Pharma Sessions, host Jonathan Kaskey is joined by Frank Sorce, Chief Commercial Officer at UPM Pharmaceuticals, to share insights into the critical decisions involved in selecting contract development and manufacturing organizations (CDMOs).

Pharma Sessions provides general insights into the pharmaceutical and life sciences industry through conversations with its guests. The content shared in this podcast is for informational purposes only and should not be considered medical, legal, regulatory, or financial advice.

The use of any information discussed in this episode or materials linked from the podcast is at the listener’s own risk. The views and opinions expressed by guests are their own and do not necessarily reflect the views of Jonathan Kaskey, Pharma Sessions, its sponsors, or affiliated organizations.

Any reference to specific products, companies, regulatory pathways, or commercial strategies is provided for discussion purposes only and does not constitute endorsement or validation by the podcast, host, or sponsors.

Pharma Sessions is hosted by Jonathan Kaskey

Follow along on LinkedIn: https://www.linkedin.com/in/jonkaskey/

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Episode Resources:

Pharma Sessions is hosted by Jonathan Kaskey

Follow along on LinkedIn: https://www.linkedin.com/in/jonkaskey/

Or join the Pharma Sessions Substack:
www.pharmasessions.substack.com

SPEAKER_00

You're evaluating C DMO partners. What are some of the non-negotiable criteria you'd advise that they validate first? Thinking things like quality of track record, tech transfer, capability, capacity, supply chain resiliency. What are some of those important things to take a look at before you even get to pricing?

SPEAKER_01

There's a number of things. And a lot of it is depending on, I always say, kind of know thyself first. Where are you in the development landscape with your program? The early stage, mid-stage. Do you think you have a blockbuster? Is it rare disease type product? Kind of knowing all those things. And the non-negotiables are going to be equipment matchup. Done some work here in our own facility. Maybe it's bench top, maybe it's into phase one, just a little bit of a GMP operation in your facility.

SPEAKER_00

I'm your host, Jonathan Kaskey. Technology and market trends are bringing change at an ever accelerating rate, and no person, team, or company can afford to be left behind. Here, we dive into the strategies and tactics that our guests use to tackle these challenges and create new opportunities, and how you can do the same in your own organization. This episode of Pharma Sessions is sponsored by Exont, makers of the X1 reporting platform. On today's episode of Pharma Sessions, I'm thrilled to welcome Frank Sorce, Chief Commercial Officer at UPM Pharmaceuticals and a seasoned commercial leader with deep experience across pharma manufacturing, business development, and strategic partnerships. I thought this could be a really cool conversation in that Frank has spent his career helping biopharma companies navigate decisions around development and manufacturing, which is important to any organization, right? So we're going to spend a lot of time about talking about selecting the right CDMO, structuring long-term partnerships, and how to maintain a focus on both quality, reliability, while balancing that with price, which of course comes up with all of these discussions. All right. With that, welcome to the show, Frank.

SPEAKER_01

Jonathan, great to be here. Really excited for this conversation. Good to see you again.

SPEAKER_00

Yeah. Two feet of snow outside of my window. How's how's your back? You do a lot of shoveling over the last couple of days?

SPEAKER_01

I was on the snowblower for about three hours on Monday. I've got two neighbors that just don't seem to be able to do their own driveways in addition to my driveway. So I did my good deed for the year.

SPEAKER_00

That's good. Yeah. Where I live, there's a lot of retirees, and I did mine, and I helped my neighbor shovel a path to his car and get his path out. But after that, that was like four hours. I'm like, you know what? My I feel like that's all I got in me.

SPEAKER_01

Yeah, the vibrations in my hands were just about all I can take at that point.

SPEAKER_00

Excellent. Well, thanks for joining. And let's just dive right in. So you've seen C DMO relationships from both sides of the table. Do you want to maybe start by sharing a little bit about your background and then we'll ask some questions about your experience here?

SPEAKER_01

Sure. So I was calculating some things. So I'm in my 37th year here of pharma business. I started right out of school with Merck Sharp and Dome, spent about eight years in the Merck organization, got my master's in marketing through their education support program. And after that stint of eight years or so, I moved on into the sort of the contract sales business, which at that time was a very early Sinios for a couple of years and a very early IQ via, which were under different names at that time. Sure. And we supported Large Pharma in putting boots on the ground for them, sort of supplementary sales forces. And one of those clients was Reliant Pharmaceuticals. And I ended up joining them directly here in the Northeast as the regional business director. And we started that company, launched it, and then eventually sold it to Glaxo in the mid-2000s. And just took a little time off, and then I joined UPM Pharmaceuticals for my first tour of duty as an individual contributor in business development. And I also managed the marketing function right from day one. So I spent 12 years with UPM, individual contributor, eventually became VP of BD in marketing. They had a reorganization around 2019, and I moved on. I worked at Synergy Pharma, which is a high-powered CMC medical writing regulatory consulting firm based in Framingham. And I started their BD operation in 2021, and I was enticed to come back to UPM the sort of end of 2024, and started my second tour of duty last March 2025. So I've seen a lot across the industry.

SPEAKER_00

So you're you're a pharma lifer. Yeah, I am. Both sides of the fence. That's great. So so with all of that history, I'm sure you have a lot of experience. It sounds like starting in marketing, right? And then moving over to manufacturing and CMC consulting and back to C DMO. When a pharma, because most of my listeners are at pharma companies, when the pharma company first begins the C DMO selection process, what do you think are some of the biggest misconceptions they tend to have about how that decision should be made?

SPEAKER_01

I think some misconceptions are we can do this now remotely. We can go online, we can look at websites, we can see ads and journals, we can get corporate decks, and we can do a lot of that vetting from 30,000 feet apart. And I think COVID, a lot of people did virtual tours and they said, Hey, we did okay, we made a selection and we're and it's working out for us, but you still got to get to the sites. And why is that? Because you can only observe so much from a remote location. Just pulling into the parking lot of a CDMO, you'll start to make judgment on this organization. Is the grass cut? Is the security booth in good shape? Is the front door clean? Is the the mulch kept where it's supposed to be? You make these you start to make a judgment as soon as you get on the premises on the property. Right through to the meeting room they put you in, through the tour, the meeting of people, all those intangibles are important to the selection. And of course, do they have the right equipment? Is the place clean? Is there all those things that you kind of take for granted? But those are all obviously very important in your decision making.

SPEAKER_00

So you're saying attention to detail in the small things is a good indicator that carries through to the important parts of manufacturing.

SPEAKER_01

If they don't take care of the small things, how are they going to take care of the big things? Is there soap in the soap dispenser? Why go in the men's room? Right. Those little details about the organization will help you in your decision making.

SPEAKER_00

I'm smiling because I like that maybe this is too much information. Maybe not. If I go to a restaurant and I go to the bathroom and the bathroom's dirty, I'm like, let's get out of here. Like I do not want this. Exactly right. And that totally makes sense, right? Because you need a clean facility where every last detail of the operational manual is followed to a D. It has to be. So what are some of the, let's say, again, you're in that you're for that pharma company, you're evaluating C DMO partners. What are some of the non-negotiable criteria you'd advise that they validate first? Thinking things like quality of track record, tech transfer, capability, capacity, supply chain resiliency. What are some of some of those important things to take a look at before you even get to pricing?

SPEAKER_01

Yeah. So there's a number of things. And a lot of it is depending on, I always say, kind of know thyself first. Where are you in the development landscape with your program? Your early stage, mid-stage. Do you think you have a blockbuster? Is it is it a rare disease type product? Kind of knowing all those things. And the non-negotiables are going to be equipment matchup. Done some work here in our own facility. Maybe it's bench top, maybe it's into phase one, just a little bit of a GMP operation in your facility. Now I'm going to move. I want to make sure that the equipment we've been working on is a match for the equipment you're going to be working on. I don't want to change the manufacture of the equipment or the mechanism of which it performs its function. I really want to make sure I'm dealing with like for like. It may not be an exact match, but does the technology match up? Then I want to look at your inspection record. Where were you last inspected by? What are those health authorities? What do those inspections say about your facility? Did you pass? Did you get out of 483? I've got to have a clean track record from a regulatory standpoint. And then I'm evaluating how are you responding to my inquiry? How quickly are you getting back to me? How arduous is your CDA process? If I can't get the time of day when I'm approaching you or get some, what are you going to do when we sign a contract? Right now, bonded to you contractually. For years. For years, exactly. Right. I mean, you're not buying a batch, you're buying a relationship. And that's going to be a long-term, hopefully, good relationship for both sides. So I've got to have that sense that I'm important because if I'm not important today, I'm not going to be important tomorrow.

SPEAKER_00

A hundred percent agree. And things like responsiveness and just I don't know how how you all are structured here. It's when I'm talking to people, I know that I'm not going to be ultimately working with the salesperson usually, but I want to at least meet the team of who I'm working with, right? And make sure that if I'm thinking this is going to be a multi-year relationship, this is going to be somebody who I trust who I who I can think will have my best interest at heart. And yeah, I think getting back to your first point, you kind of have to do that face to face. It's not that different from hiring employees, honestly, right? Like we do so much, we do so much virtually, but we just need to meet somebody in order to really get a sense of them.

SPEAKER_01

Yeah, and I I will, you know, in the consulting world, it was very common. Say, listen, we're going to need support for this particular program. And they'd say, I want to meet the consultants, I want to spend an hour with them one-on-one. And you should bring that same level of diligence to the CDMO space. Who's my project manager? Can I go in a conference room one-on-one and talk to them? See what their experiences, see what have they worked on this kind of program before, and you know, really get that, like you say, it's an interview because it's a huge decision for the organization.

SPEAKER_00

So along those lines, and you would essentially, I think what you were getting at when you were saying, hey, if I'm not going to get treated well before I sign a contract, what's it going to look like afterwards? It's sort of how do you separate a sales story from an operational reality? So what evidence should these sponsors be looking for to confirm that a site can actually execute beyond audits that you're you pass your slide deck? Sure.

SPEAKER_01

This is you know, these are through conversations, and you may get some documentation. We deal in a solid oral world. Someone comes and says, Listen, I've got this concept. Do we want a modified release version of this particular molecule? What have you done before? Can you give me three examples of how you worked with a compound that was immediate release forever, and you modified that release rate and gave it sort of an advantage and extended its life cycle five more years? And we're going to benefit from that. Give me a concrete example of that. And if they're vague about it, there's a red flag there. Okay. We took it in, we did we perform these experiments, we scaled it this way, you use this equipment. Here was the outcome. They eventually got an approval. Whatever that case study is on that particular program, you want to say we've done it, not we can do it. And that's those are two different things.

SPEAKER_00

And is that what you find people ultimately? I'm sure you're in competitive situations all the time, and some people select you and some people, some people don't, right? But for the ones with when they do select you, is that the reason? Is that trust building, or what is kind of the reason that you get selected?

SPEAKER_01

Yeah, so there's it's a multi-factor decision. So is the equipment right? Can we grow within this organization? Can you scale? Take us beyond phase one or two. Do you have that experience with this particular modality? Have you worked on solid oral and taken this kind of a product forward with these parameters that we're giving you? And then, of course, your quality system. How is your quality team? How do they interact with operations? How will they interact with us? Can I check some references? Those are the, I guess, steps you gotta take in your selection.

SPEAKER_00

And where does capacity fit into all of this? Because I'm sure there's always pressure in a manufacturing business that ownership wants to see more sales coming in, but then you ultimately need to be able to deliver on your commitment. So what what do you think are some red flags that farmers should be looking for that a C DMO may be either overcommitted or struggling operationally, even if they look strong on paper?

SPEAKER_01

I think that you're probably gonna get that sense if it's very difficult to move to next steps in the negotiation. Like it took me a month to get a proposal. What's going on there? I can't get in the facility to do my visit. QA audits are six months out. All of those are telling me he's got it maxed out. You don't want a ghost town when you go there, but you don't want a situation where bins are flying back and forth and you know it looks like chaos in the facility. And you know, you want it you want a brisk sense of movement, but not too much. But all of those things up front will tell you, hey, something's wrong here. They're they're just like I'm not gonna get a slot. Even if we consummate this relationship, I'll never get the slots and for manufacturing stuff.

SPEAKER_00

We'll ship gears here to a little bit of where you think this this industry is headed. So maybe let's start to talk about I guess pricing and alternative models. So, what's your take on risk sharing or dynamic pricing models and CMO deals? Can you describe what that even is? And then when they create real realignment, when they become a trap for either side.

SPEAKER_01

That is a buzz term right now, is dynamic pricing. And some organizations, and I think this is Can you define what it is before before getting into it? Yeah, yeah it's going beyond fee for service. Traditionally, we'd say a bat's going to cost you 50,000, stability time points 3,500, a development report is 7,000, and you got a Chinese menu of everything, and then it's 500 grand, and that's what you pay. And with organizations, especially small clinical virtual companies, they can't raise the money they had been raising in the past. The last probably three years has been really tight in raising money in whatever fashion you're trying to do it. So they're unlimited budgets. So they'll say if we can meet these time frames, let's say you can get me in a clinic in three months versus six months, I'll give you a 25% bonus. So you'd be 25% cheaper on your price, but there's a kicker that would be worth it to you. So those are kind of scenarios that people are talking about right now.

SPEAKER_00

And what's your take on those? Are they effective or is it uh like an overcomplication?

SPEAKER_01

I think they can be really effective for both sides if they're well thought out. Because if I normally get $500,000 for this program, but if it's successful, I have an opportunity to make $550. That's another 10% that I normally would not have gotten if I just was a feed for service model. Now, certain organizations, if the program isn't successful or they have an adverse reaction that's just so severe they have to stop the program, you could be out a few dollars as well. It's a matter of you have to attract a number of clients to be in your portfolio so that you have a vibrant pipeline moving forward.

SPEAKER_00

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SPEAKER_01

Like no, no, you don't, and you never seem like a huge risk. It is a big risk. But if the market prevails in that direction, you have to deal with it. You can't stick your head in the sand and say it doesn't exist. You're gonna have to say, okay, how we how can we make this work? And that's where you you get to the negotiation table and you're trying to make a big deal for everybody.

SPEAKER_00

Right. You're almost like a VC trying to create a little portfolio of uh companies so that if if some of them fall out, you have some successes. That's exactly right. All right, so then try and think of a way to ask this without getting super super political, and these things are changing by the minute, right? But let's just say there's there's all this geopolitical manufacturing reshoring pressure, right? And then there's also risk that tariffs may be there one day, may not be there another day, who knows, and who knows what it's going to be by the time this thing even comes out. So, how much do you think what are you seeing companies like how much are they factoring that into their decisions around where to manufacture trade-offs between cost, speed, supply chain reliability when they're choosing sites these days?

SPEAKER_01

I think it's definitely in the thought process should we make this product in the US? That's there. There were a number of opportunities that we looked at last year where big pharma got our pricing, looked at it and said, we're just gonna leave it where it is, right? And wait, we we think that we can do it, and even if we put the tariff in there, it's still less expensive for us to make it ourselves than to use a US supplier. It's just not worth it because obviously they do it themselves in a particular country where labor is less expensive than North America, they're gonna have lower margins there. It's not gonna be as expensive if they do it in the U.S. And when they factor in 10% or 15% tariff, it just makes sense to just hold pat with what you don't. There's another contingency that's sort of, for lack of a better term, maybe more patriotic. And they're like, Listen, let's do this, let's build a facility here, let's move the product to the U.S. United States people work on products that they're actually going to consume. And then give them pride in making something, bring that whole concept back.

SPEAKER_00

Are you seeing that really happen?

SPEAKER_01

I am. I am seeing folks that say, listen, let's do it here. Let's get the best price we can. And depending on the dosage form, you get a pretty competitive price right now. In this solid world, there's a lot of capacity in the marketplace. If you're in a antibody drug conjugate, it might be tighter. If you're in a monoclonal, it might be tighter. But if you can get a competitive price and make it here, some people really want to do that.

SPEAKER_00

So that's really fascinating. I remember this is what they I'm trying not to be overly cynical here, but one thing I remember from business school was a survey where they asked people, I think it was jeans, they're like, how much extra would you pay if a pair of jeans was manufactured in the US? And people said all of these numbers, and then then they did an actual experiment to see. How much people were really willing to pay for? And the answer was zero.

SPEAKER_01

Different story. Yeah. Totally different story.

SPEAKER_00

But it's good, right? If people are willing to put their money where their mouth is, right? And but I think that the the smaller that delta gets, right, the easier it is to make that business case right to your leadership and increase manufacturing here. So let me ask you about another topic, Frank. Continuous manufacturing adoption versus traditional batch processes. Can you explain what this is and whether this is a trend that people should be paying attention to?

SPEAKER_01

It's probably been the concept of continuous manufacturing has been talked about for like 15 years, I've heard it. And a lot of the big pharma companies would only speak to a CDMO if you had this technology versus the batch. The concept, and this is my understanding of it, we've never done that here at UPM. So I'm not an expert by any means, but it's just supposed to be a more efficient way of making a product and taking a little bit of risk out of if you make one big batch and it fails, you lose the whole thing. And you may have a very expensive active ingredient, and now you're you're out that money, and now you're gonna fight on who's gonna pay for it, whose fault was it? The finger point and start, the legalities come in versus a continuous process where you can stop it, got an issue, we only lose a little bit of product or a little bit of drug product, and then it continues, and it's also a little bit more efficient where you're not maybe moving room to room. You do your blending here, you do your milling right next to it, right? You do your sizing, and now you do your encapsulation or compression, and it's right in not one little room, but a bigger room, but it's all contained there versus moving it to different parts of the facility where there's some risk, obviously. Yeah, if you do that. So I haven't seen a ton of CDMOs doing that or offering that, and that's just from my vantage point.

SPEAKER_00

That's this whole conversation is so interesting to me because I spend most of my time talking to commercial people and medical people, right? Where it's it's so it's it's a bit. I mean, we're talking about data all day long, but it's removed from the actual concept sometimes of like, well, somebody's got to get all this stuff into an actual pill that people can get into their bodies. And for me, it seems like magic because one of my strongest college memories in an academic setting is trying to complete organic chemistry labs and just failing over and over to the point where I was like, I'm following the directions. I feel like you know, like Harry Potter and Potions class. Like I just can't get the thing to work and I'm staying late. The TAs are getting like annoyed that they have to pay, and I'm just like not being able to synthesize these things. So it really is amazing that you all can do this at scale, at consistency, where somebody can go into CVS at the end of the day, get something, and not have to think twice before they put it in their mouth. So it really is it's amazing to me.

SPEAKER_01

Myself as well. You know, when I started on the sponsor side, say, you know, in sales and marketing, you didn't even think about how it was made. You're like, what was the inactive ingredients? Or you just said, hey, doc, take this uh once a day and your blood pressure goes down. It costs uh a dollar a day versus two dollars for the competitor. And then when I got into UPM in 2007, a head was spinning. About how smart these people are. They are in brilliant people. And and it also when someone says, Why does it cost so much? Why do these products cost so much? If you were in the bowels of a manufacturing facility, a development operation, and you saw the work that was being done, this how many sleeves were rolled up, and the intelligence, intelligence of these people, you may think a little bit more about that statement.

SPEAKER_00

That's fascinating. I mean, it really is very it's important work because it it just can't go wrong. That's different than a lot of jobs, right? Where that's right. All right, so let's wrap up with just a couple closing questions here, Frank. This has been super interesting for me. But looking back across your career, what's one lesson about C DMO selection that pharma leaders can usually only learn after something goes wrong?

SPEAKER_01

Yeah, I I think the the lesson is defining success up front. What are you looking for in the partner? You know, what are those non-negotiables that are really important to you, the selection team, and the folks that have to work with the CDMO on an ongoing basis? You need to define that all up front. And then you need to go out and vet those things and make sure all the boxes are checked that are important to you. And you have to go to the sites and see the people, meet the people, and in the end, you gotta use your gut and say, I I think all three of these can do it, but I just have a feeling XYZ C DMO is the right choice for us. And then you know, you could always defend that decision-making process if something goes wrong, and you'll you'll sleep at night because you did your due diligence.

SPEAKER_00

Yes, I love that. That's been my take to a number of kind of big decisions where to work, uh, various things. It's like if I get bit by something that I wasn't expecting, I'm actually okay with that, right? Like I you do what you can, you figure out what you can. It's like you never want to go into something with a concern, and then that's the thing that gets you, and you're just like, yeah, I should have listened to myself.

SPEAKER_01

I knew it. I absolutely knew it. You don't want to be kicking yourself down a road.

SPEAKER_00

Well, awesome. Well, let's leave it there. So trust trust your instincts, do your due diligence, trust your instincts, and you will end up with a happy and fruitful partnership with your C DMO of choice. And Frank, thank you so much for your time today. Pleasure, Jonathan. Thank you. This episode of Pharma Sessions is sponsored by Xunt, makers of the X1 reporting platform. And that's a wrap on today's episode of Pharma Sessions with me, Jonathan Kaske. If you enjoyed today's conversation, don't forget to hit follow or subscribe and share it with someone else in the pharma world who might need to hear it. For more on pharma trends, career growth, and business strategies, connect with me, Jonathan Kaske, on LinkedIn. Until next time, thanks for listening.