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Thanks for this, this was quite insightful to an outsider. Not sure if you will still see this follow up question but what do you feel in the production stage t

Thanks for this, this was quite insightful to an outsider. Not sure if you will still see this follow up question but what do you feel in the production stage that is the most challenging or costly process? Effective and accurate DNA rocombination? Filtering for high yielding cells? Or the purification stage?

trap_goes_hot 4y ago
By the time the process gets to our team, it is established and stable. Our team is not at liberty to tinker with the process in any way. To put it another way, if there is a high variability in the process, it won't get to the manufacturing stage. It will still be in the development stage where all those issues are ironed out. (There is also regulatory oversight on this that would have prevented us using a highly variable process) I suppose the most challenging aspect to manufacturing is the operational discipline. Getting people to give a shit about following our procedures, documenting everything accurately, and avoid taking shortcuts - all on a daily basis. This is where all the flowery HR philosophies that you read online go to die. I'll speak in general terms about cost so I don't get fired ;) To give you a sense - In terms of raw material cost and other consumables, our cost/milligram is in cents, but we sell it for about 3000 times that price. It might sound a lot, but its actually not. The reason is simple, even before we start making any money - we're already in debt - Tens of millions of dollars spent on research, product development, compliance/regulatory, buying production equipment, construction of facilities, IP, etc. Then there is the general overhead in terms of paying people's salaries, benefits, 401k, operational overhead, paying interest on business loans, misc business costs - advertising, marketing, distribution, etc etc. Some of these are fixed costs, some are not so we need to buffer for those as well.
- ackbar03 4y ago
  > It might sound a lot, but its actually not. Yes, unfortunately I understand why the huge markup is a necessity to cover R&D costs. I am close to people who are on these prohibitively expensive orphan drugs. What surprised me however was that when the patent for it expired, I thought prices would decrease as generics came in. Unfortunately as I learned more, it seems that biologics are so hard to produce unlike regular drugs, where Indian pharmaceutical companies can immediately come in with generics. Even though detailed information on the production process is available on the patent, it seems production variability/heterogeneity is still a major obstacle, and I was just curious where in the whole development process is this the most difficult to control for. Anyways, thanks for taking the time to respond with your insight!

trap_goes_hot 4y ago

By the time the process gets to our team, it is established and stable. Our team is not at liberty to tinker with the process in any way. To put it another way, if there is a high variability in the process, it won't get to the manufacturing stage. It will still be in the development stage where all those issues are ironed out. (There is also regulatory oversight on this that would have prevented us using a highly variable process) I suppose the most challenging aspect to manufacturing is the operational discipline. Getting people to give a shit about following our procedures, documenting everything accurately, and avoid taking shortcuts - all on a daily basis. This is where all the flowery HR philosophies that you read online go to die. I'll speak in general terms about cost so I don't get fired ;) To give you a sense - In terms of raw material cost and other consumables, our cost/milligram is in cents, but we sell it for about 3000 times that price. It might sound a lot, but its actually not. The reason is simple, even before we start making any money - we're already in debt - Tens of millions of dollars spent on research, product development, compliance/regulatory, buying production equipment, construction of facilities, IP, etc. Then there is the general overhead in terms of paying people's salaries, benefits, 401k, operational overhead, paying interest on business loans, misc business costs - advertising, marketing, distribution, etc etc. Some of these are fixed costs, some are not so we need to buffer for those as well.

ackbar03 4y ago
> It might sound a lot, but its actually not. Yes, unfortunately I understand why the huge markup is a necessity to cover R&D costs. I am close to people who are on these prohibitively expensive orphan drugs. What surprised me however was that when the patent for it expired, I thought prices would decrease as generics came in. Unfortunately as I learned more, it seems that biologics are so hard to produce unlike regular drugs, where Indian pharmaceutical companies can immediately come in with generics. Even though detailed information on the production process is available on the patent, it seems production variability/heterogeneity is still a major obstacle, and I was just curious where in the whole development process is this the most difficult to control for. Anyways, thanks for taking the time to respond with your insight!