May Feature

Technology Helps Manufacturers Create a Manufacturing Compliance Platform

Joseph Vinhais is vice-president of regulatory compliance at Camstar Systems, Inc., 2815 Coliseum Center Dr., Suite 600, Charlotte,NC 28217, tel. 707.227.6600 or 800.588.0030, fax 704.227.6780, jvinhais@camstar.com

In his March 2002 presentation to the Consortium for the Advancement of Manufacturing in Pharmaceuticals, Raymond Scherzer, senior vice-president for engineering, global manufacturing, and supply for GlaxoSmithKline, discussed the current state of pharmaceutical manufacturing. Scherzer said that large pharmaceutical manufacturers have aggregate sales of more than $300 billion annually, but spend more than $250 billion on manufacturing. According to Scherzer’s estimates, the industry spends more than $45 billion on materials, $22.5 billion on personnel, and $22.5 billion on depreciation and operating expenses (1). Fortunately, new developments in technology and business processes provide opportunities for pharmaceutical manufacturers to improve their bottom lines and their return on invested capital. When technology and business processes align, drug manufacturers become more efficient, leading to faster delivery to consumers of safer, cheaper products. One innovative solution aligns process analytical technology (PAT), Lean Manufacturing, and Six Sigma to create a manufacturing compliance platform (MCP) that could lead to significant improvements in pharmaceutical manufacturing. Challenges are opportunities Scherzer also discussed the increasing effect of the consumer market on the pharmaceutical industry. First, the growth in the senior citizen population has increased the use of the medications already on the market, and heightened the need for new drug development. At the same time, as healthcare costs continue to rise, providers and manufacturers face increasing pressures to reduce the costs of pharmaceuticals. Finally, because of broader access to pharmaceutical information on the Internet, payers and consumers are more knowledgeable, leading to a demand for demonstrable health and economic value when purchasing medications. To address these market needs, pharmaceutical manufacturers must improve manufacturing processes. New products must meet the needs of consumers while remaining safe, effective, and reasonably priced. Manufacturing sites must manage supply logistics, quality assurance, and quality control to increase efficiencies while maintaining safety and efficacy. Simultaneously, companies must improve their overall levels of regulatory compliance. Observing regulations such as Sarbanes Oxley, 21 CFR Part 11, current good manufacturing practices (CGMPs), and the Health Insurance Portability and Accountability Act of 1996 (HIPAA) can be complicated and can lead to sizeable infrastructure expenses and even fines if not properly addressed. Coordinating these processes is a synchronization challenge, but it also provides opportunities to reduce inefficiencies. Pharmaceutical companies must find novel ways to integrate compliance into their manufacturing infrastructures rather than viewing compliance as a separate process. Policies initiated by top corporate decision-makers affect processes and procedures downstream, ultimately influencing daily manufacturing tasks. At the same time, risk exposure, mitigation, and controls affect operational metrics, thereby influencing the way businesses measure success. In addition, the heightened visibility of risk management, as defined in the US Food and Drug Administration’s recent initiative, “Pharmaceutical CGMPs for the Twenty-First Century: A Risk Based Approach,” emphasizes the importance of integrating PAT into current manufacturing quality processes (2). Successful process management will lead to faster product deployment and improved productivity, ultimately leading to marketable performance and superior quality. Opportunities for noncompliance Many manufacturers believe that if they are 99% error-free, they are functioning at optimal efficiency. But, what does it mean to perform at 99% accuracy? If all aspects of healthcare were 99% error-free, we would have: •  ~5000 errors per week during surgical procedures •  30,000 newborn babies dropped at birth per year •  at least 100,000 prescriptions filled incorrectly per year. To surpass 99% quality levels, drug companies have started to examine Six Sigma, a process currently used with success in the automotive and electronics industries. Six Sigma is a business process methodology based on the concept that minimizing variation, both in product and process, will significantly reduce product defects. According to the definitions of this methodology, one standard deviation from the mean is one sigma. At a one-sigma level of operation (within ±1 standard deviation), a manufacturer would be operating at 30.23% compliance. Ideally, however, manufacturers should operate at ±6 sigma (i.e., at 99.9997% compliance). When manufacturers are out of compliance, what does it cost them? Manufacturers that operate within ±2 sigma spend more than 65% of their sales revenue on efforts to ensure quality. Companies operating within ±4 sigma spend 20–40% of their sales revenue ensuring quality. Operating at ±6 sigma makes compliance a bargain because manufacturers operating at this level of compliance spend between <1 to 10% of sales revenue ensuring quality (3). These numbers may sound extreme, but when a company adds up all costs of identifying, isolating, investigating, and solving compliance problems, the costs mount quickly. Less-immediate costs, such as legal fees, market credibility, and share price, also are consequential. Lean Six Sigma: the union of Lean Manufacturing and Six Sigma Lean Manufacturing is a business initiative that focuses on eliminating manufacturing waste, with the goal of making manufacturers more responsive to customer demand. Lean Manufacturing seeks to achieve this objective by decreasing human effort, inventory, product development time, and poor use of space. When businesses combine Six Sigma and Lean Manufacturing, the result is an excellent business process that is readily applicable to the pharmaceutical manufacturing industry. According to Michael L. George, Lean Six Sigma reduces mean manufacturing delivery time and reduces time variation in the manufacturing process, quickly resulting in improved customer satisfaction, costs, quality, process speed, and need for invested capital (4). Six Sigma brings statistical control to business processes and Lean Manufacturing reduces invested capital and improves process speed. Together, they reduce time to market, time to volume, and research and development time, all while installing defect-prevention mechanisms and processes to ensure product quality. Ultimately, these improvements also increase shareholder value. How does this management methodology benefit the pharmaceutical industry (3)? Primarily, Lean Six Sigma controls process and product variation by identifying, recognizing, and defining manufacturing problems and then characterizing, measuring, and analyzing them. It also optimizes quality control in the manufacturing process to improve production rates, enhance innovation, and reduce cycle times. Institutionalizing these changes enables manufacturers to increase their return on investment and continue revenue growth. (continued)