How Life Science CDMOs are Using Cloud Computing to Create Differentiation

January 25, 2024

Contract development and manufacturing organizations (CDMOs) are experiencing new entrants and capacity expansion, leading to the need to create and maintain differentiation in service offerings to stay competitive. With change comes opportunity, and the strategic implementation of digital infrastructure is crucial for staying competitive. In this blog, we’ll explore four reasons why CDMOs are increasingly moving to cloud applications to run their enterprise business and the benefits of cloud applications. 

  1. Capacity Expansion
  2. Differentiation and Competition 
  3. People and Collaboration 
  4. Quality, Speed, and Confidence

Capacity Expansion 

Until recently, biopharma contract development and manufacturing faced a significant capacity shortage. Procuring contract development and manufacturing services for clinical batches was a costly and time-consuming endeavor, with lead times stretching up to 18 months and price tags soaring to $30 million. However, the market has adapted, and capacity constraints have eased. Many companies have entered the contract development and manufacturing arena, expanding their services to meet the growing demand. This has shifted the focus towards value chain differentiation as companies look for ways to stand out in the market. 

Differentiation and Competition 

With capacity constraints no longer a primary concern, companies are now exploring how to differentiate themselves and compete effectively. Offering a unique customer experience and value chain capability has become the key to executing successful business plans. This involves providing top-notch quality, shorter time-to-market, and higher customer confidence. Achieving this level of differentiation and excellence requires a solid digital infrastructure. 

People and Collaboration 

Differentiating in the market isn’t just about products and services; it’s also about attracting and retaining top talent. To do so, companies must provide employees with an exceptional experience. Collaboration capabilities are equally important, facilitating seamless communication and teamwork. A modern digital infrastructure plays a pivotal role in delivering these capabilities and ensuring a competitive edge. 

Quality, Speed, and Confidence 

In life science contract development and manufacturing, the focus is on quality and scale. CDMOs strive to enhance quality control, speed up processes, and instill customer confidence. Achieving this requires a robust central nervous system for the business, which can sense, react, and operate with agility. A modern cloud platform is instrumental in enabling such capabilities. 

The Role of Cloud Applications 

To address these challenges and capitalize on the opportunities, CDMOs are turning to cloud applications. These cloud-based solutions offer a centralized, integrated, and agile approach to business operations. They eliminate the pitfalls of fragmented systems and manual processes that hinder efficiency and competitiveness. They also organize the data estate of the business to leverage artificial intelligence to create new value chain advantages for customers, while maintaining data privacy and data security. 


In conclusion, the medical device and biopharma contract development and manufacturing industries are undergoing a seismic shift. CDMOs are embracing cloud applications to adapt and thrive in this new era. The digital infrastructure not only ensures operational excellence but also serves as a cornerstone for differentiation, competition, and growth. It also positions a CDMO to take advantage of new digital capabilities such as artificial intelligence and machine learning. It’s an exciting time for both the companies within these sectors and the technology providers like Merit, who are instrumental in enabling these winning strategies through the deployment of modern cloud infrastructure. 

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