What is third party manufacturing

What is third party manufacturing/ contract manufacturing in pharmaceutical sector? Why is this concept becoming more and more popular these days?


When you enter into the pharmaceutical world, you might come across the term ‘Third Party Manufacturing’, a number of times. It has become a common and trending phenomenon nowadays. It is referred to out sourcing of products or to get manufactured from other’s manufacturing unit by own  brand names. Both parties enter into any agreement  covering the licensing, product approval, registration, purchase, sale, marketing or distribution of any of the categories of Product. Similarly in the pharmaceutical world,Pharma companies outsource their activities, to other organizations, say manufacturing of medicines, or marketing etc.

Third Party Manufacturing concept is gaining popularity in pharmaceutical segment rapidly. This concept allows many enthusiastic marketing professionals to enter into market with the products of their choice without involving themselves in the usual hustle and bustle of manufacturing process still they can enjoy the fruits of brand identity created by them in the market. In recent past, this concept has changed the face of Indian Pharmaceutical market.

There are a lot of benefits associated with this concept which explains its popularity:

Cost effective solution

It is the most cost effective method to realize your dreams of having your own brands manufactured. You can have your products manufactured under your own brand names with minimum investment and no equipments. You won’t have to spend on any operational and maintenance costs nor you would have to purchase, and maintain inventory on raw materials.  

Focused approach

Once you have given contract to the third party, your headache is over.You can just sit back and focus on other activities, since the sourcing of raw materials, designing and manufacturing is being looked upon by the manufacturer on your behalf. Now you have the opportunity to focus on your forte , such as marketing and establishing relationships with new doctors willing to prescribe your products.

Qualitative products

Since the manufacturer also wants to create their brand presence in the market, and build long term relationships with your company, they will ensure quality products for you, which in turn will help you receive good products attracting larger audience with very little involvement in manufacturing process.

Benefits from Manufacturer’s Innovations

It is generally assumed that the manufacturing units try to adopt the most advanced technology in their manufacturing processes so that they can attract more and more marketing professionals for getting their brands manufactured by third party root. In order to make themselves stand out of crowd, they innovate and create their USPs in manufacturing specific products and this will make it even more possible for quality of the final product to be improved.

Unique molecules

In Third Party manufacturing, you have the opportunities to get unique and new molecules manufactured under your brand names. Economies of scale will enable you to get unique products at competitive prices and  this will ensure a favorable environment for  your product and your brand image.Hence if you are thinking to start your own company but worrying about the huge investments, this concept will definitely help you cut down most of your expenses and take off some pressures, so all you have to worry about is determining strategies to increase your sales and expand your business. So study the procedure to start own Pharma Marketing Company by Third Party manufacturing and ignite your entrepreneurial spark.

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