Girish Malhotra, EPCOT International06.03.14
Not too long ago, a new three-letter acronym was introduced to an industry already full of them: QbD, an abbreviation for “Quality by Design.” The term states, succinctly, the fundamental goal and premise of any business: to deliver a quality product or service. Without this quality, chaos results, and it can have a serious impact on profits.
Everything has to be done right the first time. If a second chance is needed to bring product in spec, profit will be lowered, as it might take many iterations to meet quality, and even these attempts may fail. Precise process sequencing is the key to any manufacturing business, whether we are making steel, alloys, gasoline, automobiles or plastics.
Businesses achieving quality the first time did not give the processes or methods involved (product design, manufacture, process or execution sequence or whatever we want to name them) a name like QbD or any other three-letter acronym. They simply applied the fundamentals of math, chemistry and physics and common sense in manufacturing or service.
So what about pharmaceuticals? Since QbD was introduced in the pharma hemisphere there has been significant discussion of what it is, what does it do, how and what to do. There has been a lot of optimism surrounding the term, which is noble. However, in the process, some have come to view QbD as a magic act that will cure all quality issues and comply with regulatory requirements.
The sad reality is that the pharma industry, in the last 50 years, has not figured out how to apply the fundamentals of chemistry, physics and math (the same foundations of good practices that are being used in every manufacturing and service industry today) to API manufacturing and dose formulations, which, in totality, create processes that deliver quality products with little or no in-process tweaking.
If we pick up any trade journal, attend any conference or read any newspaper article related to pharmaceuticals the emphasis is on new products that will cure diseases for a limited population covered by a healthcare [mutually subsidized] program. The focus is on sophisticated methods and procedures that will tell us the quality of the product. These methods do not tell us how to produce quality product. If the product does not meet the specifications, it is due to our lack of command of the process. We have to repeat the process steps and analyze the sample to see how close we are to the desired result. The process of repeated sampling and analysis will eventually let us produce a quality product. I call the whole process QbA “quality by aggravation/analysis” that will result in lower profits than what we could have had if we knew what we were doing.
At times unnecessary investments are suggested in the name of regulatory compliance. If they do not give command of the process, do not improve asset utilization and repeated analysis is still necessary to check for quality, they should be carefully considered. I am not sure such investments have any return or value. They increase the cost of drugs. Patients willingly pay because no one knows or cares to know the real costs. Longevity is the driver.
I’m not saying this to criticize phama’s current practices but to spur discussion of what can change the landscape tomorrow. Imagine increasing profits while lowering the global healthcare costs and adding billions to their customer base. Other than pharmaceuticals, no other business has such an enviable opportunity.
Why Regulations are Needed
Of course, some of you will respond that pharma must follow FDA regulations of some such thing. But other industries have to comply with their respective regulations, but they seem to have adjusted well and are able to comply. This isn’t always the case with pharma.
As consumers, would we drive a car if we knew that its brakes would have to be checked every time we wanted to use it? Or would we fly in a plane where the landing gear had to be replaced when parked at the departure gate? However, for drugs we might not have many choices. Even if we know that they are produced by inefficient methods or even could be adulterated, we need them, and we all want to live forever.
FDA and other regulatory bodies are there to ensure products of repeatable and consistent approved quality are available. If the pharmaceutical industry could have the best practice at every step of the way that will produce consistent quality products, there may not be much need for regulatory bodies. However, having regulatory bodies is good as they keep rogue companies at bay.
The underlying question is: What have pharma companies done to exceed regulations in their manufacturing practices? We might see published examples of energy conservation or complying with environmental regulations. We may never see many examples of an API being produced using continuous process instead of batch process, or improving the yield from 30% to 85% or improving equipment use time from 35% to 75% or reducing the batch cycle time from 168 hours to 30 hours. If we saw these examples they will suggest that has excellent command of the process and product quality. If ISO 55000 standards were to be applied to API manufacture and their formulations, my conjecture is that both operations would be at the bottom of the list.
Pharma and the Current Model
Regulations in any competitive environment are generally good for the customers as the products produced will be of the highest quality and best price. However, in a non-competitive environment, the customer is generally at a disadvantage, as is the case with patent protected pharmaceuticals. Regulations are a must in this environment. One would expect generic drugs, since they are off patent, to be significantly lower priced. They are, but not to the extent that they could be if economies of scale were applied. In either case the drugs are priced at highest level in a subsidized or pay from your pocket scenario. Generally the explanation of high prices is on costs associated with drug discovery even when everyone knows that the drug discovery and other business practices (raw materials to finished products) are known to be inefficient. Very little emphasis is placed on effort that could lower costs. As stated earlier drug discovery and their methods and devices are not part of this discussion.
Pharma’s current business model is based on age-old practices of fragmented/multiple brand or generic manufacturing facilities. Generally the focus of the pharma companies, under the current regulatory guidelines, and “regulation centricity”, is to get the product to the market as fast as possible and it works for most of the companies. Patients absorb business inefficiencies. Extending life is more important than pointing to the inefficiencies of the system.
As the demographics of drug suppliers have changed, it is becoming harder for the respective regulatory bodies to keep up with the companies around the globe. This has the potential of less than quality products being distributed. We have seen this recently through ever increasing citations. Besides regulatory bodies creating barriers or banning the products from these suppliers not much can be done, as people need drugs.
As stated earlier regulatory noncompliance issues are an indication of lack of command of the process. Focus is to fix the paper work expecting everything would come in compliance. These are short-term measures and issues will come up again. Instead of fixing the root cause of the problems by having the best process i.e. process centricity; focus is on how to comply with regulations so the product is on the market as quickly as possible.
Permanent process fixes are needed to produce products that meet or exceed regulations. For it to happen, the current model and practices need to be re-evaluated. This is not on the agenda of many companies. Unless “process centricity” is implemented, supply chain practices and manufacturing model is re-evaluated, we will not see significant changes.
Some might consider re-evaluation of the current model indication of impending doom because they might have to invest in necessary upgrades. All this might sound negative, but within this negativity are opportunities that are well articulated1, as “You don’t want to let the perennial Voice of Doom kill every project. But if you listen carefully to the Voice of Doom, you’ll find he’s giving you something extremely useful: a list of almost everything that can possibly go wrong with your plan. Think of the VOD “new acronym” as your defensive coordinator, identifying all the holes you need to plug, and backup plans you need to have in place, before you launch. Instead of ostracizing your Doctor No’s and asking them to kindly shut up, why not give them a designated role on the team, telling you what’s likely to go wrong, and then pointing out when it is?”
Regulatory bodies are trying to coax pharma companies to innovate. However, companies are challenged even to implement minimal regulations we have. Opportunities to serve the needs of billions of the global population who at present do not have access to medicines exist. Unless companies make a move from within, not much will change2. If incorporated, healthcare costs will be lowered and profits will improve, a win-win.
Pharma’s Path to QbD
For pharma to incorporate QbD in its operations, it has to separate API manufacturing and their formulations (dose) as two distinct modules. Quality by Design “QbD” is nothing magical but a “repeated practice” of best manufacturing technologies and methods in the manufacture of the active ingredients and their formulation to a dose. Practice of fitting square plug in a round hole3 has to go away. Pharma has to consider and evaluate the associated equipment, unit processes and unit operations to determine if they are the most economic for the products. Unless these considerations are thoroughly reviewed, appropriately incorporated and the manufacturing focus is placed on “process centricity” everyone’s focus is going to stay with “regulation centricity” which is placing “cart before the horse” rather than doing the right thing i.e. “horse before the cart”. We have had cart before the horse for the last fifty plus years. Regulatory bodies have assured only quality drugs are marketed. Some still slip through. In pharmaceutical business winning on product quality is a must otherwise patients die. However, the winning has been due to QbA i.e. trial and error. In spite of documentation, meeting or exceeding specifications can be a hit or miss and it drains profits.
Significant confusion is created when people discuss drug discovery, its functionality and dose manufacturing (combination of active manufacture and their formulation) in the same sentence. In these discussions new drugs take precedence and everything else is forgotten. Key elements of quality having robust manufacturing processes are never discussed because they are not understood. Manufacture of each API and its formulation has distinct set of expectation. Thus they should be kept separate.
My emphasis is on the drug manufacturing, a very critical and important stepchild that has to produce drugs of approved performance and quality specifications. To produce drugs of consistent and repeatable quality, one has to understand the nuances of how the molecules are manufactured and formulated efficiently. I might sound repeating myself but unless we can create and practice best manufacturing methods, companies will be slave of regulations rather than master of regulations, as is the case now.
Along with the review of existing practices, if we dissect and separate the Brand/ethical from generic drugs, we can easily see how to incorporate methods to produce quality products meeting their purity and performance, which I call is QbD. One fact will remain in either case and that is “unless process centric practices and methods are incorporated from inception, pharmaceuticals will not move away from “quality by analysis” to produce consistent and repeatable quality products i.e. QbD”. “Regulation centricity” and QbA are the cause of the current status. There is an explanation for this reality. Changes needed to incorporate QbD for the existing products are too expensive, time consuming and do not justify investment in the current manufacturing model. Regulations are an impediment also.
QbD based practices have to start from the day a new drug molecule is conceptualized, continued from bench top to commercial plant through its entire life even if the product becomes generic. Anything short is not worth the attempt. Even if the existing regulations are modified, incorporation of process improvements that will deliver QbD based products due to short patent life, could be difficult to justify for the brand/ethical products. Generic companies might embrace improvements easily but to incorporate “process centricity” significant business model re-configuration5 is necessary.
It would not surprise me if we hear “it cannot be done” about what has been suggested. Saying “No” to change is normal. It is the first sign of recognition that something better exists.
With potential savings4 of about 20-25% of the global revenue such a review is necessary. This would result in improved profits and lower healthcare costs and is worth the effort. It will be a very big global win. Downside of such an effort is that it might drive some companies out of business. Fittest will flourish.
Nothing comes easy, but the opportunity to add an additional two to three billion patients to the customer base is seldom afforded to any business. It’s well worth the effort.
References
Girish Malhotra
EPCOT International
Girish Malhotra, President and founder of Epcot International, has over 43 years of industrial experience in pharmaceuticals; specialty, custom, and fine chemicals; as well as coatings, resins and polymers, and additives. His expertise ranges from manufacturing to process and technology development and business development.
Everything has to be done right the first time. If a second chance is needed to bring product in spec, profit will be lowered, as it might take many iterations to meet quality, and even these attempts may fail. Precise process sequencing is the key to any manufacturing business, whether we are making steel, alloys, gasoline, automobiles or plastics.
Businesses achieving quality the first time did not give the processes or methods involved (product design, manufacture, process or execution sequence or whatever we want to name them) a name like QbD or any other three-letter acronym. They simply applied the fundamentals of math, chemistry and physics and common sense in manufacturing or service.
So what about pharmaceuticals? Since QbD was introduced in the pharma hemisphere there has been significant discussion of what it is, what does it do, how and what to do. There has been a lot of optimism surrounding the term, which is noble. However, in the process, some have come to view QbD as a magic act that will cure all quality issues and comply with regulatory requirements.
The sad reality is that the pharma industry, in the last 50 years, has not figured out how to apply the fundamentals of chemistry, physics and math (the same foundations of good practices that are being used in every manufacturing and service industry today) to API manufacturing and dose formulations, which, in totality, create processes that deliver quality products with little or no in-process tweaking.
If we pick up any trade journal, attend any conference or read any newspaper article related to pharmaceuticals the emphasis is on new products that will cure diseases for a limited population covered by a healthcare [mutually subsidized] program. The focus is on sophisticated methods and procedures that will tell us the quality of the product. These methods do not tell us how to produce quality product. If the product does not meet the specifications, it is due to our lack of command of the process. We have to repeat the process steps and analyze the sample to see how close we are to the desired result. The process of repeated sampling and analysis will eventually let us produce a quality product. I call the whole process QbA “quality by aggravation/analysis” that will result in lower profits than what we could have had if we knew what we were doing.
At times unnecessary investments are suggested in the name of regulatory compliance. If they do not give command of the process, do not improve asset utilization and repeated analysis is still necessary to check for quality, they should be carefully considered. I am not sure such investments have any return or value. They increase the cost of drugs. Patients willingly pay because no one knows or cares to know the real costs. Longevity is the driver.
I’m not saying this to criticize phama’s current practices but to spur discussion of what can change the landscape tomorrow. Imagine increasing profits while lowering the global healthcare costs and adding billions to their customer base. Other than pharmaceuticals, no other business has such an enviable opportunity.
Why Regulations are Needed
Of course, some of you will respond that pharma must follow FDA regulations of some such thing. But other industries have to comply with their respective regulations, but they seem to have adjusted well and are able to comply. This isn’t always the case with pharma.
As consumers, would we drive a car if we knew that its brakes would have to be checked every time we wanted to use it? Or would we fly in a plane where the landing gear had to be replaced when parked at the departure gate? However, for drugs we might not have many choices. Even if we know that they are produced by inefficient methods or even could be adulterated, we need them, and we all want to live forever.
FDA and other regulatory bodies are there to ensure products of repeatable and consistent approved quality are available. If the pharmaceutical industry could have the best practice at every step of the way that will produce consistent quality products, there may not be much need for regulatory bodies. However, having regulatory bodies is good as they keep rogue companies at bay.
The underlying question is: What have pharma companies done to exceed regulations in their manufacturing practices? We might see published examples of energy conservation or complying with environmental regulations. We may never see many examples of an API being produced using continuous process instead of batch process, or improving the yield from 30% to 85% or improving equipment use time from 35% to 75% or reducing the batch cycle time from 168 hours to 30 hours. If we saw these examples they will suggest that has excellent command of the process and product quality. If ISO 55000 standards were to be applied to API manufacture and their formulations, my conjecture is that both operations would be at the bottom of the list.
Pharma and the Current Model
Regulations in any competitive environment are generally good for the customers as the products produced will be of the highest quality and best price. However, in a non-competitive environment, the customer is generally at a disadvantage, as is the case with patent protected pharmaceuticals. Regulations are a must in this environment. One would expect generic drugs, since they are off patent, to be significantly lower priced. They are, but not to the extent that they could be if economies of scale were applied. In either case the drugs are priced at highest level in a subsidized or pay from your pocket scenario. Generally the explanation of high prices is on costs associated with drug discovery even when everyone knows that the drug discovery and other business practices (raw materials to finished products) are known to be inefficient. Very little emphasis is placed on effort that could lower costs. As stated earlier drug discovery and their methods and devices are not part of this discussion.
Pharma’s current business model is based on age-old practices of fragmented/multiple brand or generic manufacturing facilities. Generally the focus of the pharma companies, under the current regulatory guidelines, and “regulation centricity”, is to get the product to the market as fast as possible and it works for most of the companies. Patients absorb business inefficiencies. Extending life is more important than pointing to the inefficiencies of the system.
As the demographics of drug suppliers have changed, it is becoming harder for the respective regulatory bodies to keep up with the companies around the globe. This has the potential of less than quality products being distributed. We have seen this recently through ever increasing citations. Besides regulatory bodies creating barriers or banning the products from these suppliers not much can be done, as people need drugs.
As stated earlier regulatory noncompliance issues are an indication of lack of command of the process. Focus is to fix the paper work expecting everything would come in compliance. These are short-term measures and issues will come up again. Instead of fixing the root cause of the problems by having the best process i.e. process centricity; focus is on how to comply with regulations so the product is on the market as quickly as possible.
Permanent process fixes are needed to produce products that meet or exceed regulations. For it to happen, the current model and practices need to be re-evaluated. This is not on the agenda of many companies. Unless “process centricity” is implemented, supply chain practices and manufacturing model is re-evaluated, we will not see significant changes.
Some might consider re-evaluation of the current model indication of impending doom because they might have to invest in necessary upgrades. All this might sound negative, but within this negativity are opportunities that are well articulated1, as “You don’t want to let the perennial Voice of Doom kill every project. But if you listen carefully to the Voice of Doom, you’ll find he’s giving you something extremely useful: a list of almost everything that can possibly go wrong with your plan. Think of the VOD “new acronym” as your defensive coordinator, identifying all the holes you need to plug, and backup plans you need to have in place, before you launch. Instead of ostracizing your Doctor No’s and asking them to kindly shut up, why not give them a designated role on the team, telling you what’s likely to go wrong, and then pointing out when it is?”
Regulatory bodies are trying to coax pharma companies to innovate. However, companies are challenged even to implement minimal regulations we have. Opportunities to serve the needs of billions of the global population who at present do not have access to medicines exist. Unless companies make a move from within, not much will change2. If incorporated, healthcare costs will be lowered and profits will improve, a win-win.
Pharma’s Path to QbD
For pharma to incorporate QbD in its operations, it has to separate API manufacturing and their formulations (dose) as two distinct modules. Quality by Design “QbD” is nothing magical but a “repeated practice” of best manufacturing technologies and methods in the manufacture of the active ingredients and their formulation to a dose. Practice of fitting square plug in a round hole3 has to go away. Pharma has to consider and evaluate the associated equipment, unit processes and unit operations to determine if they are the most economic for the products. Unless these considerations are thoroughly reviewed, appropriately incorporated and the manufacturing focus is placed on “process centricity” everyone’s focus is going to stay with “regulation centricity” which is placing “cart before the horse” rather than doing the right thing i.e. “horse before the cart”. We have had cart before the horse for the last fifty plus years. Regulatory bodies have assured only quality drugs are marketed. Some still slip through. In pharmaceutical business winning on product quality is a must otherwise patients die. However, the winning has been due to QbA i.e. trial and error. In spite of documentation, meeting or exceeding specifications can be a hit or miss and it drains profits.
Significant confusion is created when people discuss drug discovery, its functionality and dose manufacturing (combination of active manufacture and their formulation) in the same sentence. In these discussions new drugs take precedence and everything else is forgotten. Key elements of quality having robust manufacturing processes are never discussed because they are not understood. Manufacture of each API and its formulation has distinct set of expectation. Thus they should be kept separate.
My emphasis is on the drug manufacturing, a very critical and important stepchild that has to produce drugs of approved performance and quality specifications. To produce drugs of consistent and repeatable quality, one has to understand the nuances of how the molecules are manufactured and formulated efficiently. I might sound repeating myself but unless we can create and practice best manufacturing methods, companies will be slave of regulations rather than master of regulations, as is the case now.
Along with the review of existing practices, if we dissect and separate the Brand/ethical from generic drugs, we can easily see how to incorporate methods to produce quality products meeting their purity and performance, which I call is QbD. One fact will remain in either case and that is “unless process centric practices and methods are incorporated from inception, pharmaceuticals will not move away from “quality by analysis” to produce consistent and repeatable quality products i.e. QbD”. “Regulation centricity” and QbA are the cause of the current status. There is an explanation for this reality. Changes needed to incorporate QbD for the existing products are too expensive, time consuming and do not justify investment in the current manufacturing model. Regulations are an impediment also.
QbD based practices have to start from the day a new drug molecule is conceptualized, continued from bench top to commercial plant through its entire life even if the product becomes generic. Anything short is not worth the attempt. Even if the existing regulations are modified, incorporation of process improvements that will deliver QbD based products due to short patent life, could be difficult to justify for the brand/ethical products. Generic companies might embrace improvements easily but to incorporate “process centricity” significant business model re-configuration5 is necessary.
It would not surprise me if we hear “it cannot be done” about what has been suggested. Saying “No” to change is normal. It is the first sign of recognition that something better exists.
With potential savings4 of about 20-25% of the global revenue such a review is necessary. This would result in improved profits and lower healthcare costs and is worth the effort. It will be a very big global win. Downside of such an effort is that it might drive some companies out of business. Fittest will flourish.
Nothing comes easy, but the opportunity to add an additional two to three billion patients to the customer base is seldom afforded to any business. It’s well worth the effort.
References
- McArdle, Megan: Why Negativity Is Really Awesome Business Week, accessed March 3, 2014
- Malhotra, Girish: Reading the Tea Leaves: Predictions for Pharma’s Future, www.pharmaevolution.com, January 15, 2014
- Malhotra, Girish: Square Plug In A Round Hole: Does This Scenario Exist in Pharmaceuticals? Profitability through Simplicity, August 10, 2010
- Malhotra, Girish: Are The Savings of $120-$150 Billions Worth Having? Profitability through Simplicity August 30, 2012
- Malhotra, Girish: Financial Justification for QbD and Cost of Regulation Compliance, Profitability through Simplicity, May 22, 2012
Girish Malhotra
EPCOT International
Girish Malhotra, President and founder of Epcot International, has over 43 years of industrial experience in pharmaceuticals; specialty, custom, and fine chemicals; as well as coatings, resins and polymers, and additives. His expertise ranges from manufacturing to process and technology development and business development.
