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  • Writer's pictureJohn Hannan

ERP Considerations for a Contract Development and Manufacturing Organization (CDMO)

A CDMO is an external partner that helps product companies manage their supply chain and manufacturing operations, from initial development through to production. It provides several advantages over managing these processes internally, including cost savings and greater efficiency in development and production. By leveraging a CDMO's expertise, you can ensure that your products meet regulatory requirements while also staying ahead of the competition.

What Should Be Considered When Selecting an ERP Solution for a CDMO?

When selecting an ERP system for a CDMO, it's important to consider any potential quality and regulatory compliance requirements. Such requirements include:

Quality Assurance

An Ideal ERP software needs features that help maintain quality standards across all aspects of the product lifecycle while also monitoring production processes, testing service levels, and verifying customer requirements.

Project Management and Accounting

The CDMO is providing a customer with service that will extend over a long period of time. A good system for a CDMO will provide accounting for all expenses, milestones, revenue (think ASC 606), and employee time recording and work breakdown structures (WBS).

Regulatory Compliance

The ERP should also meet regulatory standards the global regulators set for contract development and manufacturing services.

Customer Visibility

The CDMO’s customers naturally like to be kept up to date on the progress of their project and the upcoming milestones. A good system will provide a customer portal for customers to be able to login to, see current status, and generate reports without sending an e-mail or making a phone call.

An ideal ERP solution will support all relevant regulations specific to pharmaceutical and biotechnology industries, such as FDA 21 CFR Part 11, cGMP 21 CFR Part 210/211, and Validation Requirements 21 CFR Part 11/820, among others. By ensuring your chosen ERP meets these compliance standards, you can help ensure ongoing customer success and minimize costly audits or remediation activities.

Benefits of Selecting an ERP Solution for a CDMO?

  • Real-time tracking of processes from start to finish

  • Provides a platform that can be FDA Validated

  • Project-specific reporting and visibility

  • Automated data collection for faster decision making

  • Quickly integrated legacy systems

  • Capabilities to integrate with a 3PL for distribution

  • Customer portal to provide access to project status and data in real-time

  • Enhanced scalability as your business grows

  • Improved customer experience through targeted marketing campaigns and personalized services.

How to Implement an ERP for a CDMO?

There are several key considerations when implementing an ERP for a CDMO. These considerations are important when choosing and implementing the best system for your organization's needs. Let's explore these important factors:

Technology Considerations

Technology is always changing, and when it comes to ERP systems, you need to ensure that the system you choose is up-to-date with the latest technology. Additionally, you need to be able to integrate new systems into your organization's existing infrastructure.

Business Goals and Objectives

It's important to keep an eye on your business goals and objectives when choosing an ERP system. You should also consider what type of data points you need to make decisions and create insights about your business operations.

Size of the Organization

The size of your organization will have a major impact on the type of ERP system you decide upon. Businesses come in all shapes and sizes, so pick a solution that can scale with your current and future needs.

User Experience Requirements

Consider user control panels and ease of use during implementation, so your users don't become overwhelmed with the process.

Be in the Know With John Hannan LLC

ERP solutions provide an invaluable resource for CDMOs, allowing them to track their manufacturing processes accurately, automate data collection, and quickly integrate legacy systems, all of which facilitate fast, accurate decision-making for greater scalability and productivity. For more information on ERP solutions, follow us on our LinkedIn page.


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