Angie Drakulich was editorial director of Pharmaceutical Technology.

Angie Drakulich

  The US Food and Drug Administration and European Medicines Agency (EMA) are looking for drug-manufacturing companies to participate in their joint good manufacturing practice (GMP) inspection pilot program. 

  states that companies that have submitted two separate but equivalent new drug application applications to EMA and FDA are eligible to participate in the pilot. Such companies will be inspected jointly by the regulatory agencies. In addition, if a company is expecting a routine surveillance or re-inspection by both agencies, that company can also participate in the pilot by hosting a single joint inspection.

“The overall objective is to see whether greater international collaboration can help to distribute inspection capacity allowing more manufacturing sites to be monitored and reducing unnecessary duplication,” says the EMA release.

  Over the past couple of years, the agencies have conducted similar pilot programs. FDA, EMA and the Australian drug regulatory agency conducted an 18-month joint pilot inspection program focused on active pharmaceutical ingredient manufacture in countries outside of the three regions. This pilot officially began in November 2008. FDA and EMA ran a joint inspection pilot program of companies manufacturing drugs in both regions beginning in the spring of 2009 in order to better share information.  The two agencies also ran an 18-month joint good clinical practices initiative starting in September 2009 to increase collaborative efforts to inspect clinical trial sites and studies.

  The new GMP pilot program that is getting underway is meant to build on these experiences. Companies interested in the pilot should contact their respective agency at 

Articles

The US Food and Drug Administration and European Medicines Agency (EMA) are looking for drug manufacturing companies to participate in their joint good manufacturing practice (GMP) inspection pilot program.

FDA and EMA Seek Candidates for GMP Inspection Pilot

As the pharmaceutical outsourcing industry grows in complexity, sponsor companies are re-evaluting their contract-manufacturing choices and in some cases, asking contract organizations to provide different or additional services. For their part, contract manufacturing organizations (CMOs) are burdened with new requests—and new competition—and working to restrategize and restructure their offerings and performance. To gain perspectives on the metrics currently used to evaluate supplier performance and continuous-improvement methodologies as part of the outsourced relationship between sponsor companies and contract-service providers, 

 conducted a roundtable of leading CMOs engaged in this work. 

Participants in the roundtable include: Scott Jenkins, business unit manager, manufacturing, global pharmaceutical operations, Abbott (Abbott Park, IL); Colleen Dixon, manager, Project Management Office, Baxter's BioPharma Solutions business (Bloomington, Indiana); Michael Kosko, president, Pfizer CentreSource (Kalamazoo, MI); Jochen Alberstetter, vice-president, project management/supply- chain management, Vetter Pharma-Fertigung GmbH & Co. KG (Ravensburg, Germany). 

Criteria such as on-time delivery and making product in specification have historically been and continue to be important elements in evaluating supplier performance. What methodologies do you use to evaluate your company's performance in this respect? How have sponsor companies' expectations changed in terms of delivery points and how they measure those criteria?  

It is crucial to have a management-reporting process in place that drives a company to forecast, plan, execute and report on a daily, weekly, monthly, quarterly, and annual basis. This process may involve key meetings and reports and address performance indicators that drive the business. Having a set process in place allows for transparency of information and ensures that the operation is focused on the right factors: cost, compliance, customer service, and continuous improvement (what we call the "four Cs"). 

Several years ago, Abbott set out to become best in class from an operational-excellence standpoint. As part of our certification process, we established a methodology to ensure we could meet customers' demands within a specified window. Class-A performance means being able to achieve delivery success within a designated window of performance at least 95% of the time. As part of our process, if we step outside of this window—regardless of the reason—we perform a root-cause problem-solve (RCPS) analysis with cross-functional subject matter experts (SMEs) within our organization to understand exactly why we missed the delivery. We then implement a sustainable improvement to ensure that the cause of the misstep won't reoccur. 

 Performance-evaluation methods are a crucial element of achieving optimal results in contract manufacturing. A true partnership must serve the needs of both the supplier and the customer, so we make every effort to carefully evaluate and measure performance, striving to meet or exceed our collective goals. This approach begins with an upfront discussion at the kickoff of a project to establish key success factors and the associated metrics to be measured throughout the project, and agreement on how the metrics will be calculated and the frequency at which they will be reviewed.  

In Baxter's BioPharma Solutions business, we have designed working environments to ensure comprehensive integration of the staff, processes, and tools as part of our Process 360° customer experience. This environment enables client teams to monitor metrics for each project at each stage. By understanding the robust data and being aware of key process checkpoints, our client teams can take direct action and find improvement opportunities that can influence project outcomes. 

Roundtable participants, from left to right: Scott Jenkins, business unit manager, manufacturing global pharmaceutical operations, Abbott; Colleen Dixon, manager, Project Management Office, Baxter's BioPharma Solutions business; Michael Kosko, president, Pfizer CentreSource; Jochen Alberstetter, vice-president, project management/supply-chain management, Vetter Pharma-Fertigung GmbH & Co. KG.  

We have spent a considerable amount of energy and resources on mapping the customer experience and learning and asking which data points and associated metrics are important to our clients as a project moves from start-up to product release. To support each client's needs, our applications are designed to tailor metrics. We recognize that there are differences in how clients want metrics calculated and how they will use the data. Another component of our customer-experience strategy has been to harmonize the way we calculate and use metrics across our global facilities to ensure a common understanding of the data and how to apply the data. In addition, we use detailed, customized training programs for our project teams to make sure they understand the importance of data integrity, monitoring, tracking, and reporting. By providing clear definitions and technology investment, the client and project team together gain a heightened sense of transparency and control. 

Fundamentally, our client expectations for evaluating supplier performance have not changed. A few of the common key performance indicators (KPIs) requested by clients include on-time delivery, saleable yield, exceptions, incident rates, and schedule accuracy. Other metrics such as measures of client satisfaction and mutual financial accountability, are also important to ensure a holistic approach to the partnership.  

We have noticed a heightened interest in maintaining control over projects as well as a clearer understanding of potential variables and anticipated challenges. Because many clients use a combination of in-house manufacturing and outsourcing strategies, a major driver for customized metrics has become the comparison of internal manufacturing versus outsourced performance and, ultimately, long-term value. In the upfront evaluation process, clients are interested in understanding our approach to project management, data comparisons, qualification of teams, and metrics tracking as a means of supplier research and assessment. Thanks to our integrated systems, we can share the seamless approach we have to data during every step of the process.  

 A number of Pfizer CentreSource (PCS) customers use scorecards that are reviewed on a quarterly, semi-annual, or annual basis. Many of these components are based on the Assurance of Supply/Regulatory Compliance, Quality, Service, Cost and Innovation (AQSCI) Pyramid for rating suppliers.  

The base of the pyramid and its most important component is assurance of supply and regulatory compliance. This component reflects the minimum requirement for any company that supplies the pharmaceutical industry. While consistently meeting the specifications of a client is a prerequisite, companies can differentiate themselves by the services that they extend to their clients, including:   

Although cost is always a factor, it is typically not the most crucial factor in a supply relationship. A producer's ability to be innovative is always valued by customers, but that ability needs to be closely coordinated due to the potential impact on regulatory filings.    

 Vetter manufactures based on customer demand. We measure our deliveries using the KPI Customer Service Level (CSL) with respect to "on-time-in-full." This measurement is performed monthly and shared within the company as well as with the customers. To achieve the preset targets, we make use of SAP (an enterprise-resource planning system) and respective management tools. These tools are part of the Oliver Wight-based operational excellence procedures [Oliver Wright is an international business improvement specialist] that have been in place at Vetter for five years. 

What other KPIs or balanced scorecards do contract-service providers and sponsor companies use to set measurements for accountability and product supply?  

It is important to work with suppliers to ensure you have what you need when you need it and to produce and deliver customer products on time. The backbone of our relationship with partners is a high degree of communication and transparency. In addition, we use various tools to help us drive accountability.  

For example, we have a Supplier Excellence program in place to measure our suppliers' ability to deliver on our needs. This ensures transparency. As part of our Management Control and Reporting system, we track weekly metrics such as schedule adherence and monthly metrics such as supply-plan achievement. We use monthly metrics to measure delivery performance and to conduct RCPS sessions and put corrective actions in place. 

 In addition to on-time delivery, quality, and meeting product specifications, we evaluate our success by analyzing a number of other performance indicators through client scorecards. These scorecards serve as a measurement of the ultimate value for both Baxter and our customers and are reviewed by both parties on a regular basis. For example, saleable yield is one KPI that helps us outline our end result. Other scorecard factors focus on process quality, including monitoring cycle times throughout the batch life cycle and conforming to schedules.  

In addition to strictly quantitative factors, we focus heavily on customer-service measurements by using a robust customer feedback program that is matched with an internal assessment and health scorecard. Ultimately, we look for comprehensive and real-time evaluations to help demonstrate mutual accountability and partnership value.  

 Depending on the relationship with the customer (i.e., multiple products/projects) we usually share and discuss KPIs along the entire supply chain. This supply chain begins with the "inspection of incoming goods to setpoint" and follows the preset material flow. Other shared KPIs include: lead time, yield, stock coverage, right-first-time-rate, and master production-schedule stability. During the precommercial phase in project work, we use the methods outlined by the International Project Management Association (IPMA) Baseline 3.0. (IPMA is a nonprofit standard-setting body based in The Netherlands.)  A respective certification program has therefore been established. Vetter's projects are released and steered by an operational and strategic steering committee. 

How does your company evaluate internal performance? For example, is performance benchmarked against other projects? Do you employ a Six-Sigma approach or other total quality management approach?  

At the core of our relationships is a strong focus on the four Cs previously mentioned (cost, compliance, customer service, and continuous improvement). We aim to provide high compliance and customer service at a market competitive cost. A sustainable continuous-improvement program helps the provider company continue to improve existing operations with long-term results and can lead to decreased cost for both companies. RCPS, Kaizen (this approach involves subject-matter experts mapping out a process and looking for improvement opportunities), and Six-Sigma approaches are integral to our overall business-partnership plan. 

As part of our management-reporting process, Abbott holds regular meetings to review performance metrics and to discuss whether we are on track to meet the overall schedule and deliver according to customers' needs. If any KPIs are off track, we conduct an RCPS session.  

We also seek feedback from our customers. For example, we ask, "What would make it easier for you when you're in our facility?" Based on feedback to this question, we installed a Customer Conference Room with a table, chairs, phone, overhead-projector screen, white boards, and wireless Internet access so that customers have a comfortable place to work while visiting our facility. 

 Setting internal goals and metrics, in addition to the metrics we strive for with clients, and measuring those metrics is a crucial element of our work. We are not satisfied with merely meeting targets, but always strive for continuous improvement. This philosophy is based on Baxter's implementation of Lean manufacturing. We apply Lean methodologies to monitor and improve day-to-day performance at every level. We apply techniques from Lean, Six Sigma, and total quality disciplines to drive broader improvement efforts. Through these disciplines, we use standard review points or stage gates for our process-improvement efforts to ensure that individual projects are integrated into the overall company strategy. 

In addition to internal scorecards, we use a tiered management-review system, which includes regular assessments of functional performance using visual display boards that help ensure productivity and identify outliers. These display boards showcase real-time data and outcomes for each team member and each process.  On a less frequent basis, high-level meetings are held to review major projects and KPIs to ensure we are meeting customer needs as well as short- and long-term strategies. 

 As a sales/marketing organization, PfizerCentreSource does not have manufacturing assets but rather uses the Pfizer Global Manufacturing (PGM) network of sites. Within PGM, the Network Performance Organization focuses on the evaluation of internal performance. The Operational Excellence team within the Network Performance Organization is charged with building our Six-Sigma and Lean-improvement capability across the network and its functional groups to deliver high performance. By organizing this function centrally and focusing on effective knowledge management, sites can readily adopt best practices.  

 Performance of processes is measured using SAP. After the data are graphed, project performance is presented and discussed at the operational steering committee meetings. Supply-chain performance evaluation is part of the sales and operations process. 

Vetter has implemented—and is continuously improving—a company-wide program called Vetter Optimization System (VOS). It consists of three pillars, one of which is to maintain focus on statistics and to fully implement Six-Sigma methods. The other two pillars cover business process management and Kaizen. 

Given recent industry concerns in supply-chain integrity, can you explain what additional criteria you may use to evaluate suppliers of raw materials or other ingredients (e.g., increased audits, additional testing)?  

We have an extensive program to evaluate raw-material suppliers. We gather information from supplier questionnaires and conduct on-site facility audits. Suppliers are automatically a part of our Supplier Excellence program, which involves monthly evaluations. If there are any issues or concerns, an RCPS session is held. 

 Baxter takes a strong position and stance in ensuring that quality raw materials are used in production processes. The quality-by-design (QbD) approach emphasizes a more careful examination of the quality of our raw materials and raw-material suppliers. This industry trend will only continue as we see more companies involved in the complex pharmaceutical supply chain. Specifically, we use a variety of measures and analytical techniques to assess raw materials received at our facility. Raw materials go through rigorous, predefined testing procedures, including appropriate compendial testing to ensure consistency in raw-material performance.  

Based on our preemptive actions on quality standards for our external vendors, we have been able to further improve a strong supplier–quality process. Baxter recently implemented a Global Supplier Quality Plan to ensure that suppliers meet rigorous global quality criteria. The plan is supported by supplier audits and quality agreements between the supplier and Baxter, which enable Baxter to determine and maintain the quality of goods. This global system also enables Baxter to share knowledge across the entire organization as it relates to raw materials and vendor-supplied goods. 

The improvements to our supplier-quality plan have led to continuous improvement and better customer service. By using the mentioned techniques previously described, we are able to better understand the cycle time and throughput capability of our planning processes, which enables us to accommodate unanticipated client requests.  

 Pfizer remains extremely active in the area of supply-chain integrity. Even before the most recent concerns about economically motivated adulteration, Pfizer had an aggressive process in place to effectively evaluate and select suppliers, raw materials, and packaging. That process includes assessments of supplier technology and capabilities, operational and manufacturing capacities, and investments. We also evaluate quality processes, systems, procedures, and compliance to current good manufacturing practice as well as supply-chain practices that include supplier selection and quality management. 

 Vetter's quality system includes regular supplier audits and a thorough incoming inspection process. API-related raw materials often are supplied by our customers. Methods are selected or developed separately depending on the product. 

We respond to customers' demands by applying security measures such as defined and documented interfaces within the process. Vetter Solutions develops packaging components that support anticounterfeiting measures, including tamper-evident closure (Vetter-OVS). We also apply other available solutions based on customer needs.  

Continuous improvement is of benefit to the sponsor company and contractor. Are there certain methodologies (e.g., organizational or operational structures and communication vehicles) that you would recommend to identify and facilitate continuous improvement? What approaches might be used to recognize those improvements in the context of the working relationship? 

Leading CMOs share their experiences with regard to client expectations and performance indicators as well as strategies for adapting to the changing contract-manufacturing environment. This article is part of the 2010 Outsourcing Resources special issue.

Managing Expectations and Deliverables: A CMO Roundtable

A new report  from the International Data Corporation (IDC) shows that life-science companies are increasingly using third-party outsourcing firms to augment or replace their information-technology (IT) services. IDC is a global provider of market intelligence, advisory services, and events for the IT, telecommunications, and consumer-technology markets and is based in Framingham, Massachusetts.

Vendor Asssessment: Life Science Buyers Guide to Manufacturing and Supply Chain IT Outsourcing

, is published by the IDC Health Insights division and also states that companies are likely to continue to expand spending on third-party IT services in the year ahead. “Industry sentiment and adoption trends all point to continued growth in IT outsourcing between 4–6% over the next 12–18 months, followed by moderate growth of approximately 4% annually for the next 2 to 3 years,” says a 

"With the global recession now in the rear-view mirror, life science companies are slowly shifting their primary cost-cutting focus back toward long-term top-line growth," said Eric Newmark, research manager with IDC Health Insights, in the press release. "Manufacturing and supply-chain strategies not only remain a critical component of maintaining lower-costs, but also hold the key to reducing corporate liability, protecting brand equity, and optimizing operational efficiency."

  The study results show that 63% of pharmaceutical companies outsource some aspect of manufacturing or supply-chain-related IT; that percentage is up from 48% just two years ago. Of the 63% of companies that do outsource IT services, approximately 18% outsource to only US-based firms, 4% use offshore firms, and 41% use both. 

A new report from the International Data Corporation (IDC) shows that life-science companies are increasingly using third-party outsourcing firms to augment or replace their information technology services.

Third-Party Outsourcing of IT Services on the Rise

The US Food and Drug Administration has joined the Tox21 collaboration, which aims to develop ways to more effectively predict how chemicals will affect the body and environment. The collaboration’s founding members include the US Environmental Protection Agency (EPA), the National Institute of Environmental Health Sciences National Toxicology Program (NTP), and the National Institute of Health Chemical Genomics Center (NCGC). The collaboration, established in 2008, combines federal agency resources to carry out its initiatives. “FDA will provide additional expertise and chemical-safety information to improve current chemical-testing methods,” according to a joint 

  According to  Paul Anastas, assistant administrator for EPA’s Office of Research and Development, “This collaboration is revolutionizing the current approach to chemical risk assessment by sharing expertise, capabilities, and chemical information, which will lead to both a faster and deeper understanding of chemical hazards.” EPA provides chemicals to Tox21 as well as fast, automated tests to NCGC to screen thousands of chemicals a day. Specifically, 

 Finding innovative chemical-testing methods that characterize toxicity pathways

 Finding ways to use new tools to identify chemical-induced biological-activity mechanisms.

 Prioritizing which chemicals need more extensive toxicological evaluation

 Developing models that can be used to more effectively predict how chemicals will affect biological responses

 Identifying chemicals, assays, informatic analyses, and targeted testing needed for the innovative testing methods 

Conducting 50 or more ToxCast high-throughput screening assays on an enlarged chemical library every year for the next several years

 Providing the data generated from the innovative chemical-testing methods to risk assessors to use when making decisions about protecting human health and the environment.

 Working under a memorandum of understanding,  the Tox21 members already  have screened 2000 chemicals against dozens of biological targets. Tox21 aims to increase that number to 10,000 by the end of this year. 

“This partnership builds upon FDA’s commitment to developing new methods to evaluate the toxicity of the substances we regulate,” said  Janet Woodcock, director of FDA’s Center for Drug Evaluation and Research. 

    FDA will work with Tox21 members to prioritize chemicals that need more extensive toxicological evaluation and to develop models that can better predict human response to chemicals, according to the press release. 

"The addition of FDA to this effort allows biomedical researchers and regulatory scientists to work together side by side to more rapidly screen chemicals and find more effective ways to protect the health of the public,” said Linda Birnbaum, director of the National Institute of Environmental Health Sciences and the NTP, in the release. 

The US Food and Drug Administration has joined the Tox21 collaboration, which aims to develop ways to more effectively predict how chemicals will affect the body and environment.

FDA Joins Chemical-Screening Collaboration

The Laboratory Services Division of the Philippine Food and Drug Administration (FDA) has attained internationally recognized accreditation for its testing and calibration laboratories, according to a July 12, 2010, US Pharmacopeia (USP) announcement. The specific accreditation, the International Organization for Standardization/International Electrotechnical Commission (ISO/IEC) 17025:2005, serves as the industry’s top standard for being able to provide quality and valid medicines to consumers.
  
 USP, along with the US Agency for International Development (USAID), has been working with the Philippine regulatory body to achieve accreditation since 2006 through its 

Promoting the Quality of Medicines Program

 (PQM). PQM is a five–year, $35-million collaboration focused on assuring the quality, safety, and efficacy of medicines essential to USAID's priority health programs.
  
USP sent staff to train laboratory professionals at the Philippines FDA on good laboratory practices, dissolution testing, and high-performance liquid chromatography for a fixed-dose combination anti-tuberculosis (TB) drug. A primary goal of the Philippines training was to equip local FDA analysts with the appropriate skills to determine the quality of anti-TB medicines in the country. Substandard and counterfeit TB medicines-along with drugs for other common diseases in developing countries-are a growing risk to countries such as the Philippines. "Such medicines have the potential to undermine decades of investments in public health,” said Alonzo L. Fulgham, acting administrator of USAID, in a USP press release about the partnership. “Without good quality, safe medicines to treat diseases such as HIV/AIDS, malaria and tuberculosis, the impact of other health initiatives may be weakened. The PQM Program focuses on this critical aspect of combating these diseases."

  Added Philippine FDA Director Nancy Tacandong in the USP press release, “I am thankful that USAID and PQM came at an opportune time and helped FDA in gaining accreditation. Filipino consumers and export industries stand to benefit from this achievement of the FDA.”
 
The USP program, with funding from USAID and the Philippines Mission, also helped the Philippines’ FDA establish a quality-monitoring program for anti-TB medicines. To continue the relationship, USP plans to host visiting scientists from the country later in 2010.
 
USP is also carrying out a Drug Quality and Information program to provide technical assistance in drug quality assurance, to develop and disseminateunbiased drug and therapeutic information, to train healthcare workers to better use medicines, and to provide scientific evidence for healthcare decision making indeveloping countries. The program, with support from USAID, is underway inNepal, Russia, Mozambique, Senegal, Vietnam, Cambodia, Thailand, Laos,China, Kazakhstan, and Romania.

USP and USAID Launch New Program to Improve Drug Quality

The Laboratory Services Division of the Philippine Food and Drug Administration (FDA) has attained internationally recognized accreditation for its testing and calibration laboratories, according to a July 12, US Pharmacopeia (USP) announcement.

USP Works With Philippines to Strengthen Drug Quality

The Pharmaceutical Research and Manufacturers of America (PhRMA) 

 earlier this week that John J. Castellani will replace Billy Tauzin as President and Chief Executive Officer. Tauzin stepped down earlier this year and has been serving as a senior advisor to the trade association. Castellani’s role will become effective Sept. 1, 2010.
  
 Castellani has spent the past nine years as president and CEO of Business Roundtable, a leading association of corporate chief executive officers based in Washington, DC. Previously, he served in leading positions at Tenneco, a designer, manufacturer, and distributor of emission-control and ride-control products/systems for the automotive industry; the National Association of Manufacturers; and TRW, a global service provider to the automotive industry. Castellani began his career as an environmental scientist at General Electric, according to the PhRMA press announcement.
  
 “This is an exciting time for our industry, which is leading the way in providing patient-centered health solutions,” said Pfizer Chairman and CEO and PhRMA Board Chairman Jeff Kindler in the PhRMA press release. “At this critical moment, it’s important that we have the highest standard of leadership in this position. And we have that in John. John is the gold standard, and I’m extremely pleased that he will lead our team.”
  
 Added David Brennan, president and CEO of AstraZeneca and head of PhRMA's search committee, “His experience in coalition building and strong reputation of working across the political divide set him apart. He will contribute mightily to our mission in a time of dynamic change.”
  
 “The pharmaceutical industry touches millions of people around the world. The industry’s work saves and extends people’s lives everyday,” said Castellani in the release. “As US health care reform is implemented, I look forward to working with the dedicated people of the industry, public officials and other key stakeholders in the health care community to ensure that the benefits of the legislation help the most Americans possible.”
  
 In related news, the president and CEO of the Generic Pharmaceutical Association (GPhA), Kathleen Jaeger, also 

 this year. She resigned from the trade association, effective June 30, and plans to stay on as a senior advisor through the end of 2010. Jaeger had been with GPhA since 2002. In late June, the association announced that Bob Billings, vice-president of policy, would serve as interim executive director. Of note, FDA’s Office of Generic Drugs also lost its director this year, Gary Buehler, when he moved to head up the agency’s Office of Pharmaceutical Science.


The Pharmaceutical Research and Manufacturers of America (PhRMA) announced earlier this week that John J. Castellani will replace Billy Tauzin as President and Chief Executive Officer.