Getting from Series A to B to C(MO); The Balance of Funding and Hiring in the Biotech Industry

In most cases, the people hired in a company’s infancy will define the company itself, its success, direction, and survival. Hiring within the first few years must be nothing short of strategic, allocating what little resources you have to ensure you achieve the right things at the right time. Series A funding is often the first big hurdle in Biotech, but what you do in between that and securing Series B funding is just as important. Groundwork is key here; laying it to hire a CMO at the right time can be critical for your company, and the most important appointment following Series A as you begin clinical trials. 

CMO’s are essential for any Biotech but come with a caveat: they’re essential at the right time. Daniela Begolo, MD at EQT Life Sciences, recently discussed how important timing can be for Phase I Biotechs with her peers at the LSX Investial event. She warned about bringing a permanent CMO on too early in an article published by BioXconomy, stating that, while the CMO is a key hire, and should be considered pre-series B, it isn’t always essential in Phase I.

The sentiment between Begolo and many others is simple: you don’t have to have the whole team there on day one. “By the time you get to Series B, you need to be a well-oiled machine that is ready for clinical execution”, says Gonzalo Garcia, an Investment Partner at Syncona Investment Management. This brings us back to the idea of groundwork and laying it at the right time. Phase I seems to be the best time to start thinking about hiring a CMO, the right one for your company. Whether you want to bring them on part-time between Phase I and Series B, move to a permanent contract once Series B funding is secured, or simply want to build relationships with CMOs ahead of Series B funding and go straight for a permanent contract is really up to you, it’s simply what’s best for you.

We have seen our partners understand this, and many have chosen to utilise the service of a consultant CMO who can offer the expertise they need on a flexible, cost-effective basis whilst allowing them to fully assess the need for a full-time CMO. Consultants know how to hit the ground running fast, often managing multiple clients at once meaning they are experts in efficiency and can draw from the live experience of other companies they might be supporting. 

One assignment we recently completed reflected this situation well. We placed a consultant CMO with a small start-up Biotech in Europe. The CMO is working with them 1-2 days per week, supporting their advancement into the clinic and guiding the early medical strategy. 

They raised a healthy amount of seed-financing, with promising POC data, and have almost finalised a Series A round. The client reached out to MRL Life Sciences as they began to explore the benefits and need for a CMO. 

As with many other Biotechs at this stage, they were conscious of two main things, cost and resource. 

They knew they needed the expertise of a CMO as they moved from pre-clinical to clinical activity, but with a planned FiH trial date of 2026 they were worried about jumping the gun and bringing on a CMO too early: could they afford a significant headcount cost? Would there be enough work to do? Would their financing spread should the timelines move? What if they make the wrong hire? 

This is where MRL Life Sciences came in. We spent time understanding their financing stage, the clinical strategy/timelines, and their budget. We found them a consultant who has specific experience in the relevant therapy area, stage of company development and the flexibility they need. 

They are now working with a consultant CMO that offers flexible access to their services, they can select how and when they need support; meaning that when there are significant moments such as regulatory meetings, or discussions with KOLs/Investors they have the expertise they need. Instead of worrying about spending huge amounts of cash up-front, they operate on a simple hours-worked hours-paid basis. 

They also gained the ability to utilise talent from outside their usual geographic reach – it turned out that the best consultant for them was based in another country. MRL supported them with compliant contracts and onboarding, and we managed their payroll using our easy-to-use timesheet portal.

If you’re starting to think about hiring a CMO, get in touch with us today for a chat; we can start laying the groundwork for you, so you hire the right CMO at the right time, in a way that suits you.