Thursday, September 20, 2007

AstraZeneca - more on that whole outsourcing thing

It all started here.

Ed at Pharmalot was right on the money as usual!

Yesterday he wrote:

The drugmaker was in overdrive this week after one of its own execs was quoted in The Times of London as saying that manufacturing will be outsourced over the next decade, primarily to India and China. Like others, we carried an item. But then yesterday, AstraZeneca was in a titter and e-mailed select media to denounce the report. Curiously, the publicity team never insisted that its own David Smith, exec vp of operations, was misquoted.

Rather, they alluded to a misunderstanding.

But wait. There's more:

At the end of the day, the AZ effort to disavow Smith’s remarks appears disingenuous and resembles the worst kind of lawyerly parsing.

Ouch!

Meanwhile, in todays' Times, their business editor James Harding wrily notes:

AstraZeneca, it seems, wants to inject new life into the Big Pharma business model, but it wants to do it quietly. This week, unexpected details emerged of a bold new strategy to focus on R&D and marketing while outsourcing basic manufacturing.

The news may have led to red faces in the boardroom, but in fact David Brennan, the chief executive, deserves credit for such a move. Amid ruthless competition, rising costs and looming patent expiries, monolithic drug giants urgently need to reinvent themselves.

Outsourcing has transformed virtually every other consumer industry. If it can ensure quality control, why not pharmaceuticals?

Wise words!

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