Agnes Shanley is senior editor of Pharmaceutical Technology.

Agnes Shanley

	On Oct. 25, 2018, in a gala at the American Museum of Natural History in New York City, the Prix Galien’s USA Committee awarded biopharmaceutical companies for excellence in developing products that are expected to have the most tangible impact on patients’ lives. A committee chaired by Sue Desmond Hellman, CEO of the Bill and Melinda Gates Foundation, which includes Roy Vagelos, chairman of the board of Regeneron and former CEO of Merck, as well as Marc Tessier-Lavigne, president of Stanford University; Paul Marks, head of cell biology at Memorial Sloan Kettering Cancer Center, and the Nobel Prize laureates Michael Brown, Richard Acel, Joseph Goldstein and Bengt Samuelsson, chose this year’s winners:

		Celgne-Agios won for ‘Best Pharmaceutical Product’ with IDHIFA, which treats acute myeloid leukemia, which the National Cancer Institute has named one of the ten deadliest forms of cancer in the United States. The therapy acts by disrupting a specific metabolic pathway in cancer cell development, and requires testing for a specific biomarker that indicates genetic mutations in patients who are most likely to respond to treatment.

		Kite’s Yescarta and Novartis Pharmaceutical’s Kymriah both won for ‘Best Biotechnology Product’.Yescarta is a genetically modified autologous T-cell immunotherapy for treating large B-cell lymphoma; Kymriah is a one-time cell-therapy based treatment for B-cell precursor acute lymphoblastic leukemia and for adults with relapsed large B-cell lymphoma.

		Boston Scientific Corp. won ‘Best Medical Technology’ for Watchman, its coronary implant designed to reduce the risk of embolism and stroke in patients with non-valvular atrial fibrillation. The implant offers an alternative to lifelong administration of the blood thinner, warfarin.

	The gala took place in the ocean exhibit at the museum, under the huge blue whale model suspended from the ceiling. A red carpet was rolled over the museum’s iconic steps on Central Park West, serving as a visual reminder of the real heart of an industry whose public image has, at times, been hijacked (most infamously, by Martin Skreli). It brought attention to the tireless, but invisible, work of the scientists and engineers who develop new therapies, who deal with setbacks and frustrations far from the eye of the public and the media. Teams at companies that had been nominated for the award were all in attendance and, while team leaders spoke after receiving the award, most teams were present for the awards.
	

	The Galien Foundation also honors achievements that make medical breakthroughs available to more of the world’s citizens, with its Pro-Bono Humanitarian Award, which was established in 2007 and sponsored by the late Elie Wiesel, a Holocaust survivor and human rights advocate who won the Nobel Peace Prize in 1986. His widow attended the event.

	This year, the Foundation renamed this award the Roy Vagelos Pro Bono Humanum Award for global health equity, to honor Mr. Vagelos, whose efforts have eradicated the parasitic disease river blindness in many countries in Africa and Latin America. Vagelos had pledged to make Merck’s drug Mectizan available “as much and as long as necessary” to eliminate this preventable disease. Over the past 30 years, the company has supplied more than two billion treatments, at no cost, treating 250 million people, and the gesture has become a benchmark for corporate ethics programs everywhere.

	The 2018 prize was awarded to Bill and Melinda Gates of the Gates Foundation for their work in making vaccines and malaria treatments accessible to patients in the developing world. Past winners have included US presidents Jimmy Carter and Bill Clinton, Drs. Francis Collins and Anthony Fauci from the National Institutes of Health, and Bernard Kouchner cofounder of Doctors without Borders.

	 "Bill and Melinda Gates…are guided by a simple principle: all lives have equal value. They not only believe this, but put this into practice around the world," said Dr.  Desmond-Hellmann at the event. "I can confidently say that their generosity, hard work, and strength of purpose are helping make our world a better place."

	The Galien Foundation, established in 1970, was designed to reward innovation in improving the human condition through medicine. It was named after the Roman physician Galen, who is considered the father of modern pharmacology, and is the equivalent of the Nobel Prize for biopharmaceutical and medical technology research.

	The Foundation is stepping up its international presence and agenda. On November 27–28, 2018, it will host its first Forum in Dakar, Senegal.

Articles

While recognizing the unsung work of scientists in corporate research and development, the Galien Awards remind the industry of its priorities: patients and future patients within the global community.

Recognizing Scientific Excellence and Altruism

	Rising drug prices, industry profits, and patient access to new cures have become polarizing issues as healthcare moves to a value-based framework for reimbursement. President Donald Trump has suggested that drug companies be required to reveal list prices for any drug advertised directly to consumers. While the goal of transparency is laudable, simply providing the list price, or even a price based on average payment for insured vs. uninsured patients, would be far too simplistic a solution, panelists agreed during “Making Medicines Affordable,” a discussion at the 2018 Galien Foundation Forum in New York City on Oct. 25, 2018.  The program brought together representatives from each key biopharma stakeholder group-venture capital, small innovator, Big Pharma, insurance company, and government-to share their different perspectives.

	Panelists emphasized the importance of 

 and establishing the value of each new therapy, and also getting to know payer groups and reaching out to them as early as possible.  As Kent Rogers, senior vice-president, industry relations, with United Health Group, Inc., asked the audience, “How well do you know who will be paying for your treatments?” 

	He suggested broadening concerns beyond issues of efficacy and safety to include questions of reimbursement. “Consider yourself as a patient, a parent, a customer. How much would you be willing to pay for this treatment?” he asked. One way to gain a better understanding of payer issues, he said, is to bring in a reimbursement team into the process early in drug development, during the Phase II through IIIb period, to help make more realistic 'go/no go' decisions. 

	Rogers also recommended that manufacturers take advantage of FDA relief on pre-Prescription Drug User Fee Act (PDUFA) discussions to discuss issues with payers, who want to understand the product launch but who must consider questions of innovation within a framework of predictability.  “Consider the cadence of the payer’s process,” he says, noting that their job is not to stifle innovation but to challenge it. “Educate the C suite and R&D teams to better understand the issues that are involved,” he said.

	In the United States, the real dilemma for branded biopharmaceutical and pharmaceutical companies today is that they are developing specialized, innovative treatments using approaches such as gene therapy. Some of these treatments are administered only once in a patient’s lifetime, but innovators remain stuck in an old 1980s payment model that predates generics and is based on traditional dosage forms and dosing.  

	Today, as Scott Howell, vice-president and head of US market access at Novartis, noted, 90% of US prescriptions are filled with generic pharmaceuticals. “This means that, nine out of every ten prescriptions bring no revenues to drug innovators.” He recalled the situation a few decades ago, when branded drugs were divided into large categories of therapies, with tens of millions of patients in each category. 

	Opening the program, Michael Rosenblatt, chief medical officer at Flagship Pioneering, sketched the complex reimbursement system in place in the US, in which pharmaceutical companies discount drugs from 5% to 20% off list price, and pharmacy benefit managers retain the difference, while patients pay 20% of list price. Insurance companies may attempt to keep fees stable, but still pass cost increases on to patients through higher deductibles and copayments.  

	As panelists mentioned, list prices for pharmaceuticals have increased dramatically over the past decade, with oncology drugs registering double-digit growth through 2015.

	“In the end, the patient’s interests are the least protected,” said Rosenblatt. For example, a person earning $50,000 per year ($40,000 after taxes), will typically pay $8000 for health insurance, he noted. If anyone in his or her family gets sick, the individual will pay a deductible of $4000 and copayment of $9200, for a total out-of-pocket cost of $21,200. Even if drug costs were cut in half, and the copayment fell to $4200, the total would still be $16,200, 40% of after-tax income, Rosenblatt said. 

	He posed some rhetorical questions to launch the discussion: 

		Is the US system really an insurance system or is it more of a cost-sharing arrangement involving drug manufacturers, insurance companies, and pharmacy benefit managers? 

		Do intermediaries extract more money than the value they add?  Are they taking benefits that should be given to pharma companies for their innovation? 

		Can annual pharmaceutical price hikes be justified?

	“If we move money around but don’t provide benefits to patients, we haven’t accomplished our goal,” he said.

	Although the conversation between healthcare system authorities and pharmaceutical manufacturers will differ in each country, it must always be based on questions of value and risk, said Sir Andrew Dillon, CEO of the National Institute for Health and Care Coverage (NICE) in the United Kingdom. The group has 

 from some patient and public interest groups for its refusal to approve some innovative therapies for reimbursement by the nation’s single-payer public healthcare system. 

	Working with different stakeholder groups, NICE has developed new ways to allow access to innovative treatments that might have been rejected in the past due to high cost.  For instance, the 

 (CFD) has been revised to allow provisional use of treatments where there some gaps remain in the evidence supporting their use.

	Dillon discussed the system in the UK, and NICE’s goal to provide a consistent, reproducible method for reviewing evidence-based medicine and determining value. 

	There must be a clear understanding of how the healthcare system will determine the value of any innovative treatment, said Dillon. “Value, or the incremental therapeutic benefit to patients, is the start of the conversation and, in the end, will determine what is reasonable to pay, wherever in the world the discussion takes place,” he said.

	As Dillon explained, the UK uses a value-based framework to gather medical evidence of a drug’s impact and then brings all interest groups together, from payers and patients to manufacturers, healthcare professionals, and government healthcare representatives in a discussion that is mediated by NICE. 

	There is a need for manufacturers and healthcare system representatives to understand each other’s pain points, Dillon said. “Pharmaceutical companies have invested huge amounts and need to see a return on those investments, and healthcare systems need to appreciate the risk that innovators take, but companies also need to recognize the risks that healthcare systems take when they say ‘yes’ to an expensive new therapy,” he says.  “A transparent, consistent, repeatable process is needed that is fair to both sides, so that everyone that has an investment in the decision can play a part in determining value.”  

	Risk-sharing agreements between companies and healthcare systems will be crucial in making more special therapies accessible to more patients. One new model taking shape is “coverage with evidence development.” As an example, he cited crizotinib, a specialized treatment for non-small-cell lung cancer that costs $66,000 (£51,000) per patient, but greatly simplifies dosage and makes it more convenient. The drug was 

 by NICE in 2016. A special fund was set up to pay for treatment during an interim period while more 

	Novartis, which was one of the first pharma companies to openly embrace value-based reimbursement approaches, is emphasizing value-based data for each new therapy in development, says Howell.  “We’re spending more time and doing a better job of this,” he said, and choosing list prices thoughtfully, including input from all stakeholders including payers.” Use of rebating is much higher than it was four to five years ago, he said, and structural changes began to be seen in the industry after the challenges that followed the introduction of the hepatitis C treatment, Sovaldi.  

	One new approach being explored is ‘trades’ that would exchange value-based pricing restraint on the part of manufacturers for greater and easier access, to bring new treatments to more patients, said Howell, who coauthored a 

 on this topic with James Robinson from the University of Berkeley and Steven Pearson from the Institute for Clinical and Economic Review in Boston, which was published in the 

Journal of the American Medical Association 

	Walking the talk: Spark Therapeutics’ journey

	A highlight of the panel was a case study of sorts, a work-in-progress that illustrates how one innovator in gene therapy is tweaking the boundaries of a 20

-century reimbursement framework to improve access to a 21

-century treatment.  John Furey, chief operating officer of Spark Therapeutics, discussed the company’s strategy with Luxterna, a once-administered gene therapy designed to treat retinal dystrophy, which uses adeno-associated viral vector (AAV) delivery and was approved by the FDA in 2017.  

	Retinal dystrophy is a very rare disease, Furey explained, affecting fewer than 2000 patients in the US (contrasted with 20,000 for hemophilia), of whom 50% to 75% are eligible for treatment with the therapy. “Before launch, we were very concerned about our responsibility to ensure that our approach to market access provided a strong precedent for access to similar therapies in the future,” he said.  

	The company reached out to payers, patient groups, and healthcare providers, before the PDUFA to discuss the therapy’s clinical benefits and other issues. The cost per unit of the one-time treatment was already in the hundreds of thousands, and given the standard markup of 20%-30% charged by healthcare facilities administering the treatment, the total cost would be significant. 

	Payers asked whether that was an appropriate markup for a one-time therapy, said Furey, noting that they also asked how the company might guarantee clinical results in both immediate outcomes and long terms.

	Acknowledging that the company could take some risks since this was its first commercial therapy, Furey said, Spark developed the “Spark Path” concept. The program was based on an innovative contract model, in which Spark provided a facility and contracted with the insurer, which took receipt of the product and supplied it to the healthcare center that would administer the treatment. 

	The insurer could then negotiate for an appropriate fee for delivery of service on an outpatient basis, Furey said, reducing financial stress on the healthcare facility and providing payers some reassurance that the markup charged “wouldn’t be egregious.”

	In addition, Furey said, the company offered rebates, one covering the first 30Â­ to 90 days, and the second covering 30 months, in which Spark would agree to pay 20% of costs if the terms were not met. “In fact, we were prepared to pay more,” he said.

	Preparing for a tsunami of one-time treatments

	Spark has also proposed a demonstration project with the US Centers for Medicare and Medicaid Services (CMS) that would involve steeper discounts and annual payments. Right now, based on the existing framework, payment is expected to be upfront, but the company is currently working out ways in which payments could be made annually.

	CMS has been interested and engaged, Furey says. “A tsunami of one-time therapies is coming, with 90 treatments currently in Phase III, and we’re hoping to be part of the solution by deploying this demonstration project,” he said.

	Spark has also developed a strong patient services group that is working closely with patients and caregivers to manage treatment.  So far, the company has achieved more than 80% of medical coverage with payers within six months of the product’s launch, said Furey. In addition, more than 60% of have been treated under the Spark Path program.

	Innovation will be needed to improve access and reduce costs to new innovative treatments, and to prevent them from becoming what one audience member at the Forum commented could be “boutique” approaches limited to the very wealthy. Clearly, value-based and risk-sharing approaches, and closer contact with stakeholders early in development, will be important in ensuring a better bottom line for manufacturers and greater access to innovation for more patients.

More-and earlier-interaction between R&D and payers will be essential if innovative therapies are to become more accessible for patients, and more profitable for manufacturers, said panelists at the 2018 Galien Foundation Forum.

Ending the Impasse on Drug Pricing

New drug development is so challenging that it’s hard to blame manufacturers for seeking shortcuts. But one area that cannot be given short shrift is chemistry, manufacturing, and controls (CMC) strategy, which offers a blueprint for taking a drug from the lab to clinical stages and through to commercial manufacturing.

	“CMC is the most underappreciated aspect of the whole drug development process, but it can make or break development,” says Ed Elder, director of the University of Wisconsin’s pharma experiment station, which performs early-phase development, preformulation, and formulation work for both small and large molecules. 

	“Large pharma companies are unlikely to make mistakes due to the resources invested early in program management. They generally have much more experienced personnel and turn to consultants primarily to supplement their staff when timelines accelerate,” says Christopher Bussineau, senior consultant with Biologics Consulting Group, Inc. 

	“Smaller companies, especially technology innovators, do not have the same number of experienced people on staff or too few staffers with the specific experience required for the drug that they are developing,” he says. Bussineau considers the case of a start-up company that is developing a novel topical formulation that contains a well-characterized protein as an active ingredient, with staff that formerly worked in the cosmetics industry. This group can fail to assemble an analytical package that is robust enough to characterize and control the product. The result, Bussineau says, puts too much risk on the product by, for example, not knowing the stability-indicating assays, not identifying significant impurities, and setting up inadequate formulation recipes. “Companies with limited budgets and experience may force short development timelines that compromise assay qualification and validation, as well as supplier and material qualification; facility and equipment qualification; storage conditions; tech transfer; and process validation,” he says. 

	Although Big Pharma has done well with CMC over the years, as it moves away from a focus on R&D to one that emphasizes acquisition strategies and licensing, the picture may begin to change in the future, says Elder. Smaller innovative companies do not always understand the importance of having a clear CMC strategy. “Some small biotechs take the approach of ‘Let’s run as fast as we can with whatever works, and if there’s a problem, we’ll deal with it later,’” he says. 

	Small biotechs should learn from Big Pharma that performing extensive due diligence on CMC is crucial before an asset is acquired. This is necessary in order to protect the investment, says Bussineau, especially if the technology is outside of the company’s area of expertise. “It is possible for companies to buy a process that cannot be scaled up; has dozens of impurities that were previously undetected by the seller’s CMC quality-control group; may not have sufficient stability; or that may have been created with an uncharacterized cell bank,” he says.

	FDA’s accelerated review process, part of the 501(b)(2) approval pathway, may have made it more tempting to take shortcuts that, in some cases, have added millions of dollars and months if not years to development timelines. This is reflected in the growing number of Complete Response Letters (CRLs) that FDA has issued to manufacturers. CRLs put a temporary stop on a drug’s approval until specific issues are addressed. For the past few years, as the complexity of drug formulations has increased, FDA reviewers have issued more CRLs that directly cite CMC deficiencies. 

	According to a recent study that analyzed CRLs issued between January 2017 and May 2018 (1,2), FDA issued 33 CRLs for 25 new drug applications (NDAs), six biologics, and two complex generic-drug applications. Of the 24 CRLs that manufacturers were willing to talk about, 25% reflected failures within the manufacturer’s CMC program. Eighty percent of the CRLs were issued to small companies, and 80% were for drug applications that used FDA’s 505(b)(2) approval pathway (2). 

	“Timelines are very crunched, especially now with accelerated approvals,” says consultant James Blackwell, principal of Windshire Consulting Group. It’s essential that drug developers think through any process, go through it step by step and unit operation by unit operation to determine risk and predict where issues will show up during scaleup or technology transfer. “Operating companies must be proactive and drive their CDMO [contract development and manufacturing organization] partners to do this [with them],” Blackwell says. 

	More telling than any regulatory failings are the internal metrics that won’t be visible to anyone outside the organization, says James Bernstein, founder and principal of Live Oak Pharmaceutical Services. Questions to ask, he says, include the following: 

		How often do we have out-of-specification (OOS) results? 

		How often do we have reworks on batches of drug substance or drug product? 

		How often have we had to reformulate the product? 

		Have we had a failed manufacturing batch? 

	Any one of these should be considered a red f lag, Bernstein says. Bussineau suggests asking the following questions as well: 

		Are we doing sufficient trend analysis to know when it is necessary to revalidate the process? 

		Do we know the cost of nonconformance, and is it keeping total cost of goods sold (COGS) from decreasing over time? 

		Do the product lifecycle plans include process improvements or equipment changes? 

	Given the complexity of CMC, the best way to develop a clear strategy is to base it on a target product profile, which looks holistically at what you’re trying to achieve, says Elder. Questions to address include the therapy, patient population, and understanding the physical chemical characteristics of the drug and how that plays into all those factors, he says.

	In addition, cost elements and intellectual property protection must also be considered. “You need an understanding, not only of the basic science of CMC, but how that fits into preclinical strategy, clinical strategy, regulatory strategy,” says Elder. 

	Every compound and every development program will be different. “It’s a matter of understanding what information is needed and when, and generating it in real time. Based on what you learn, you can adjust that strategy as you go so that you can make good decisions on whether or not to move forward at each step,” he says. 

	Errors of omission are typically the biggest problem. “Many developers fail to anticipate problems based on the data that have been generated. In some cases, they haven’t generated the right data, or they haven’t thought through all the potential problems. In other situations, they don’t have adequate expertise in the CMC area, and so they just continue to do what someone else did or what they think is necessary without a thorough strategy or plan,” says Elder. 

	As a result, the development team may miss a solubility or stability issue, or a polymorph change, Elder says. It is especially important to look for signs during analytical development that may signal problems later on, such as changes in the compound under different conditions. 

	“You do some forced degradation studies that may show whether something is sensitive to oxidation, to acidic or basic conditions, or to hydrolysis. Depending on what type of solid systems you’re using to dissolve your drug for analysis, you may discover solubility issues. You may see precipitation issues during testing that show that compound may be converting salt forms and, thus, is less stable than you thought, or the compound may not be as soluble as you thought,” Elder says. 

	Frequent analytical testing is the key, says Bussineau, along with scale-up and scale-down models, quality risk management principles, thorough documentation, and a lifecycle approach. “The earlier you set the foundation, the sooner it will benefit the development program,” he says. “People talk about working ‘with the end in mind’,” says Elder. “I prefer to turn that image around, and look from the end through to the beginning, and consider the best path to get there,” he says. “Get your regulatory people involved and think about intellectual property protection strategy early on. Look at it from the payers’ perspective. Think about the manufacturing angle, and whether technologies might be too expensive, but do this as early as possible in development,” he says. 

	Even a simple product line extension, and a change as simple as adding a new flavoring or coloring to a product can result in problems, says Elder, resulting in the creation of a new polymorph form due to differences in solubility. “There are some things that you can’t anticipate, but you can test and try to induce those things during testing,” he says. “I’ve had things like liquid-filled capsules that started leaking because the packaging wasn’t designed appropriately,” says Elder. In other cases, a product’s “failure” was due to clinical trial patients trying to open up the liquid capsules with a fork to determine whether they were being given the placebo or an active ingredient, he says. 

	He warns against taking the easiest way out, recalling one case that involved a very insoluble drug where the project team decided to go to first-inhuman clinical trials with a powder-in-a-bottle approach, to save formulation time. They weighed powder, put it in a vial, and liquid would be added at the clinic to make a slurry for patients to drink. The resulting process wound up taking more time than it would have taken to make a solution. “It all comes back to getting the right data and making the best possible decisions,” he says. 

	With biopharmaceuticals, Bussineau has seen the following errors: 

		Failing to audit a CDMO for specific expertise (e.g., clinical manufacturing versus commercial-scale manufacturing and quality assurance and control capabilities) 

		Failure to qualify and validate appropriate assays 

		Failure to question ‘what might go wrong’ 

		Believing that data are a complete reflection of the product 

		Not characterizing sole-sourced, esoteric raw materials and identifying an alternative supplier 

		Failing to identify all critical process parameters before starting a process performance qualification 

		Failing to identify the mechanisms of product degradation during the intended storage condition of drug products and drug substances, and failing to develop assays that might have detected this problem 

		Setting in-process intermediate, drug substance, and drug product specifications without sufficient knowledge of process capability 

		Failing to develop a potency assay until a process is defined that leads to inactive product 

		Failing to develop a target profile and quality target product profile 

		Not using a quality risk management approach to decision making in everything from deviation investigation to validation protocols to development plans 

		Failure to set up quality agreements with all suppliers. 

	Another big mistake that companies make is failing to work with FDA, says Bernstein. “Small companies may interact with FDA on clinical issues, but may underestimate the need to interact with the agency on CMC issues. Sometimes they don’t appreciate the opportunity and value of having direct communication with the agency,” he says. 

	Bernstein encourages small companies to think one phase ahead of where they are, so that if they’re doing Phase I work, they should already be incorporating elements that will be needed in Phase II. This way, even if they decide to sell the asset, the buyer won’t have to redevelop the synthesis or formulation, he says.

	Small pharma companies can often do without a dedicated CMC person throughout Phase I and even into Phase II, says Bernstein, but at some point during Phase II, this will change. “You need at least one if not two people to manage the CMC issues of getting ready for the NDA and managing CDMO relationships,” he says. “This person should have an advanced degree, project management and management experience, and several years of experience in an integrative capacity, understanding the relationship between synthesis, formulation, and quality control.” In addition, they will need good people skills, he says. 

	Bussineau summarizes strategy development with partners: “Document everything from the plan to deliverables; make the plan transparent and translatable into a coherent budget; enable a team with the appropriate skills, supplement the team with consultants where needed, and grow when necessary; develop partnerships with your service providers; develop ‘win-win’ contracts, and, finally, set the right definition of success.” 

	Bernstein suggests getting as much information as possible on potential CDMOs. “Visit each of them yourself, and get their proposals organized so that you can compare them directly [point by point].” He suggests considering intangibles. “Do people look happy at their facility? Is it well equipped? What kinds of training programs do they have? Ask for references from consultants and other colleagues,” he says. 

	Beware of inconsistencies. Bernstein recalls one CDMO that had a great track record in formulation and manufacturing. “Any time we’d ask them about an aberrant dissolution value or other questionable result from their QC lab, they’d say ‘It’s just an outlier’ without investigating it. Because this happened several times, we don’t work with them anymore,” Bernstein says. 

	It’s also important to spend time on writing the CMC portion of the NDA or abbreviated new drug application (ANDA), Bernstein says. All too often, applicants submit a Module 3 that is poorly written, in which crucial information remains buried somewhere in the submission but cannot be found.

	“A submission needs to tell a story, and it should be a coherent one, with information that is readable, clear, and as concise as it can be,” he says, and not the 300-page P2 section that he recalls one firm submitting. “They had information requests from FDA and were making no progress because reviewers could not find and review the information within the time allowed,” he says.

	“You don’t need to tell them about everything, but you do have to tell the complete story for  your product and for pivotal tests. Nonessential information can easily be summarized and referenced, but essential information must be there and easily retrievable,” says Bernstein.

	When a CMC failure does happen, Bernstein recommends using a fishbone diagram to determine whether it was mainly due to the human factor, materials, methods, or facilities.  Every manufacturer has its own performance metrics (e.g., success rate, performance to plan [yield], plant/equipment utilization rate, productivity [time], deviation closure rate, and corrective and preventive action closure rate). FDA’s evolving quality metrics promise to standardize these company-specific measures to develop a consistently strong view of quality in the future, says Bussineau. “We’ll have to wait and see how that program goes,” he says.

	1. J. King, “CRLs: Big Trouble for Small Pharma,”

www.camargopharma.com/2018/06/complete-response-letterscrls/


	2. A. Brown, “Are Small Companies Carrying the Complete CRL Can?” 

www.evaluate.com/vantage/articles/data-insights/are-smallcompanies-carrying-complete-responseletter-can


	Vol. 42, No. 11
	November 2018
	Pages: 20, 22–23, 56

	When referring to this article, please cite it as A. Shanley, "Don’t Let CMC Oversights Derail Drug Development" 

Experts share best practices, and war stories, for a crucial but often underappreciated part of drug development.

Don’t Let CMC Oversights Derail Drug Development

The weeks preceding the US Drug Supply Chain Security Act’s (DSCSA’s) Nov. 27, 2018 serialization deadline were full of new developments. In September, FDA issued final guidance on grandfathering (1), which exempts pharmaceutical products that were packaged before Nov. 27, 2018 from serialization requirements. In September, the agency also published final guidance on use of the National Drug Code (NDC) (2), as well as draft guidance in the form of a Q&A document on product identifiers (3). FDA now requires that the NDC be placed on each package, rather than embedded in GS-1’s Global Trade Item Number (GTIN). This means that manufacturers who assign GTINs to product packages will now also need to include the NDC, assigned by FDA to identify drugs and to submit registration and listing information (4), separately on each package. 

	In July 2018, according to an October report (5), FDA began enforcing DSCSA traceability requirements, issuing its first DSCSA-related form 483 to the US pharmaceutical distributor McKesson (6). The 483 cited inadequate tracing, quarantine, and communication systems for responding to counterfeit product. 

	On October 18, the standards-setting group, GS-1, released its status report on how well US manufacturers are handling serialization. The report is based on research that the group conducted in May 2018, scanning product barcodes at AmerisourceBergen, McKesson, and Cardinal Health’s distribution facilities (7). GS-1 studies in 2017 had only involved AmerisourceBergen and McKesson. This year’s number fell short of the 30–40% expected, but still reached 20.7%, up significantly from 6.6% in 2017. For Cardinal Health, the figure was 15.1%. 

	Observers see these results as positive. They definitely reflect the grandfathering policy, which allayed manufacturers’ concerns about having to maintain two supply chains and raised specters of possible shortages. “We probably won’t see 100% serialization for another two to three years,”says Julien Faury, vice-president of operations at Adents. 

	The product identifier guidance means that manufacturers will have to keep the product’s NDC on the package, with the bar code on the side, says Faury, instead of only using the GITN with embedded NDC on the package. 

	“Manufacturers are reviewing labels, and some may have to reduce the size of the artwork,” he says. Bob Celeste, founder of the Center for Supply Chain Studies, also sees the results as a sign of progress. For one thing, he says, the barcode scans were performed in May, so things may be quite different now. “There are a number of manufacturers who are ready to go with serialization now, but aren’t doing it until they absolutely have [to],” he says, due to grandfathering but also some issues with line speeds. 

	“Many of the manufacturers that we have talked with had spent significant time over the summer continuing to test lines, troubleshoot data issues, and validate systems, and there has been a significant amount of knowledge sharing going on among manufacturers, contract manufacturing organizations (CMOs), and third-party logistics providers during this time,” says Brian Daleiden, vice-president of industry marketing at TraceLink, who agrees that results are encouraging. 

	Grandfathering will provide some buffer for manufacturers. Initially, it was expected to apply at the point of shipping, and manufacturers were looking at scenarios where they might have to thin down supply, says Celeste. 

	“Having it apply at the point of manufacturing will allow them to continue to manufacture product as usual, and then cut over to serialized lines at the end of the month,” he says. 

	However, it will also add complexity, because hybrid inventory will exist in the supply chain, says Daleiden. Distributors, dispensers, and healthcare organizations will need to prepare for an environment in which serialized, non-serialized but grandfathered, and non-serialized but exempt medicines will all co-exist for an extended period of time across the supply chain, he says. 

	One thing is certain, Celeste says, and that is that there won’t be any more ‘give’ on US enforcement deadlines. “Some companies already have lines serialized but don’t have them turned on yet, and moving enforcement dates around a lot can make things difficult. It’s like box cars on a train, after you’ve hit hard on the brakes,” he says. 

	Despite progress, challenges remain around data quality, data formatting, and artwork adjustments, says Daleiden, particularly when there is a disconnect between a manufacturer’s assumptions and plans and those of their trade partners. He expects these problems to get worse as the 2020 deadline approaches, because most hospitals and pharmacies do not have direct trade or communication connections with original manufacturers. There isn’t as much collaborative conversation and testing between manufacturers and distributors as there should be, he says. The key will be communication and education, says Daleiden, because compliance 

	with DSCSA is a shared responsibility. “If a manufacturer affixes a serialized product identifier on a pack, but it isn’t correctly readable by a member of the supply chain, it immediately raises all kinds of questions about error correction, exception management, and potential suspect product procedures,” he says. Manufacturers can implement their own version of supplier letters to downstream trading partners, informing them of their serialization and grandfathering plans, decisions on data fields like GTIN and expiration data, and testing protocols that they would like to execute, Daleiden suggests. 

	“It will take some time to work out all of the quality and misaligned expectations, but the grandfathering buffer will be critical in enabling manufacturers and trade partners to work out remaining technology and business process issues post-November 2018,” says Daleiden. In the meantime, he says, “The focus has to move from putting a barcode on a package, to considering the challenges of ensuring that someone else can make sense of the information in that barcode.” Overall, standards will be hugely important, he says.

	Progress in Europe has been affected by the fact that requirements for master data changed in 2018, requiring updates, says Faury. In addition, individual countries such as Portugal are asking companies to download data to national hubs, so manufacturers must now send serialization data to both the central hub and national hubs. 

	“In Europe today, the level of serialized product is similar to what it is in the US at around 20% or 25%, but I don’t think even 5% of hospitals and pharmacies can handle serialized product. It will take another two or three years for them to be ready and fully operational,” Faury says. “A lot of this is just growing pains and trying to get a huge supply chain to move forward in step,” says Celeste. 

	Another noticeable trend is pharma’s increased acceptance and interest in evaluating blockchain for supply chain traceability and other applications. Adents and Microsoft are working on three pharma blockchain initiatives using the Novatrak platform. They plan to launch a pilot program after FDA guidance on DSCSA pilot testing is finalized, as expected in December. 

	In October, in Europe, the contract packaging company Tjoapack and the data management specialist, Veratrak, launched Epoch to explore the use of blockchain in life sciences. The venture will also share and extend a blockchain-based data exchange tool for product master data that the two companies have developed and are now launching at Tjoapack, says program manager Dexter Tjoa. The Center for Supply Chain Management is also progressing to the next stage of its blockchain research and pilot program, with more news expected by the end of 2018. 

Grandfathering Policy for Packages and Homogenous Cases of Product Without a Product Identifier

Product Identifier Requirements Under the DSCSA Compliance, Guidance for Industry

Product Identifier Requirements Under DSCSA Q&A, Draft Guidance

FAQs by the Pharmaceutical Industry in Preparing for the US DSCSA

, May 23, 2017.
	5. D. Kracor and A. Gitterman, “

FDA Issues Guidance Documents and Begins DSCSA Enforcement

2018 Update, Impelemntation of DSCSA Serialization Requirements


	Vol. 42, No. 11
	November 2018
	Pages: 50–51

	When referring to this article, please cite it as A. Shanley, "FDA Provides More Clarity on DSCSA," 

New FDA guidance offers a time buffer but increases supply-chain-management complexity, as active DSCSA enforcement begins.

FDA Provides More Clarity on DSCSA

	Biotechnology developers should be aware of subtle differences between the way that European and United States patent authorities approach monoclonal antibodies.

	Protecting intellectual capital is an imperative for every country that wants its biotech business to succeed. However, what works in one nation may not work in another, and applicants need to pay attention to regional differences to ensure that they will achieve desired results.As Monika Rai and Juliet Redhouse, attorneys with the law firm,Mathys & Squire LLP, describe some differences in practice between the United States and Europe as they concern monoclonal antibodies.

	The European Patent Office’s (EPO) approach to patenting antibodies focuses on their being novel, inventive and “reproducible by a skilled person.”  These attributes are closely connected to antibody target, structure, or function. For instance, how the antibody binds to its target’s epitope; whether its structure might lead to greater affinity, or whether or not it is capable of blocking a particular type of receptor.  Ensuring that these points are made clear in an application will be essential for any developer.

	On Oct. 9–11, 2018 in Madrid, CPhI’s BioLive program will explore many facets of biopharmaceutical development, manufacturing, and business. For more information on intellectual property issues, read the September 2018 article on the subject in 

Biotechnology developers should be aware of subtle differences between the way that European and United States patent authorities approach monoclonal antibodies.

Protecting Antibody IP: Consider Regional Differences

	2017 was the worst year on record for pharmaceutical counterfeiting and illegal diversion, according to the Pharmaceutical Security Institute.  Manufacturers, law-enforcement entities, and regulators are taking concrete steps to protect patients from fake and substandard drugs.

	Around the world, many pharmaceutical manufacturers are laying a strong foundation for supply-chain safety. They are working to meet serialization requirements set by the US Drug Supply Chain Safety Act and the EU’s False Medicines Directive, as well as other requirements in other parts of the world.  An elite group is working on aggregation and more advanced traceability efforts.

	However, issues such as cost and IT practices have been slowing progress, according to Richard Bergström, pharma lead for SICPA SA, a specialist in anticounterfeiting who was formerly director general of the International Federation of Pharmaceutical Manufacturers and Associations (EFPIA). For small companies, the cost of installing the technology is one issue, but the greatest challenge is in data transmission. 

	As one of the key issues facing the pharmaceutical industry, supply chain security and anticounterfeiting will be discussed at CPhI in Madrid this week. On Tuesday October 9, at 3:50pm, Alastair Taylor of Systech, discussed the serious threat posed by counterfeiting, while on Wednesday October 10 at 3:50pm, Jon Luccada, chief science officer for pharmaceutical and medical products at StoelzeOberglass, will discuss tracking on primary pharmaceutical packaging.

	For more coverage of the issues involved in preventing pharmaceutical diversion and counterfeiting, including an interview with Richard Bergström, read 

September 2018 cover story, which also touches on efforts to fight counterfeiting and diversion at the distribution and drug-dispensing level (1).

Cost and IT practices may be holding back progress. 