THE INSOURCING MODEL
While outsourcing of laboratory services in the biopharmaceutical and pharmaceutical industries is a long-established
resource strategy, insourcing has grown exponentially as a
phenomenon during the past 15 years. The model enables a
client to collaborate with a strategic partner who would hire,
train and manage their own highly skilled team that can perform managed laboratory testing services in the client’s own
laboratories and under its own quality systems. Adopting the
approach means that organizations can benefit from the expertise of an outside team, while affording them the security
associated with keeping projects, proprietary methods and
analytical techniques in house.
Clients may choose to adopt an insourcing approach for multiple reasons. One of the main reasons is that many may find it a
challenge to get their own headcount approved. As publicly-held
companies favor variable non-labor costs, this is where insourcing can prove invaluable. Insourced employees aren’t managed
by the client; they are supervised by the professional scientific
services (PSS) on-site leadership and typically are allocated
through an outsourcing budget; meaning they aren’t added to a
client’s headcount and are not co-employed.
Another reason is that often organizations have the space
and laboratory equipment, require immediate turnaround time
and scientific collaboration, but do not have the vital headcount.
With quality system including processes and standard operating procedures (SOPs) already in place, all biopharmaceutical
organizations need is the necessary expertise to manage and
KEY DRIVERS FOR INSOURCING
There are several factors that are driving the insourcing trend,
ranging from the high value nature of the work and the preference to manage risk on-site, to more technical decisions based on
the timelines in which the activity must be completed.
Insourcing can build a truly collaborative work environment. Traditionally, client/partner relationships have involved
the partner team working remotely at their own site. Insourcing involves a core team of qualified, experienced individuals
located at a client’s facility. By bringing partner companies and
their clients together in close proximity, a greater emphasis can
be placed on constant communication, idea sharing and joint
problem solving, creating a real-time approach that serves to
This approach means that the insourcing provider is responsible for all of the recruitment, developing work schedules and
managing productivity and performance. This not only reduces
costs and time burdens, but frees up client time and resources to
focus on core areas of their business.
Adoption of an insourcing solution also solves potential
issues associated with hiring traditional temporary staff and
avoids the turnover rate that these staffing programs routinely face by offering employees benefits and career progression.
Accessing scientists on a long-term basis, as opposed to using
temporary workers, can help to build expertise and keep talent
inside the organization.
PSS is an efficient program with enormous emphasis on cli-
ent service, ensuring value to the client’s processes. This becomes
even more apparent when the costs associated with training and
retraining are factored in. Insourcing gives clients the flexibility to
build their resources quickly in the face of escalating workloads,
while also allowing headcount to be scaled back in the event that
Insourcing relationships also present a welcome option for
organizations that may have disused laboratories and equipment
available as a result of prior downsizing initiatives. Utilizing the
opportunity presented by insourcing can ensure the most value is
derived from these pre-existing assets.
THE RIGHT INSOURCING PARTNER
Once an organization has decided to embrace an insourcing
model, identifying the right partner to collaborate with will
be paramount to success, especially as the selected team is
going to play such a fundamental and visible role within the
Critical to success will be the partner’s tried-and-tested expertise of setting up and managing laboratories, as well as validating equipment according to a client’s SOPs and lean laboratory practices as needed. Organizations should work closely
with prospective partners to understand their previous success
in translating their capabilities into the client environment. It
is also important that a partner company has a reputation for
retaining talent long-term. Finding a company that can demonstrate a history of low staff turnover and focus on taking care of
employees should be a prerequisite.
It is also important to identify partners that are willing to
agree upon quality and productivity metrics upfront. Governance
meetings should take place on a regular basis so that the provider
can give a detailed update on the effectiveness of the program
and can demonstrate that they are delivering on their promises
of high quality, safety and compliance.
LOOK TO THE FUTURE
Biopharmaceutical companies are constantly evaluating their
strategies for more efficient and cost-effective drug development. Embracing the insourcing of professional scientific services enables organizations to leverage internal capacities by
collaborating with full-time highly qualified scientists from
experienced backgrounds, without any co-employment issues.
By maximizing the real-time exchange of scientific information and enabling high performing scientists to be engaged in
a customer’s facility, the insourcing approach encompasses the
best elements of external outsourcing and in-house R&D activities. It should be noted that insourcing can form a long-term
strategy in supporting pipelines as well as providing the flexibility required in this sector. Trust and security in the partnership
can provide strategic flexibility in meeting a client’s scientific
needs for many years to come.
As the industry comes under increasing time and cost pressures, we will no doubt see continued growth of the use of
insourcing programs. Their ability to offer direct control while
enabling clients to tap into a much-needed pool of expertise
will continue to prove key to long-term development success in
today’s complex manufacturing climate. CP