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Materials safety and analysis:staying lean, CoMpliant,and Cost-effeCtive

Best Practices for oPtimizing

Pharma raw material insPection


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Phmu Mufug www.phmmufug.om 2

Materials insPectin

cntents3 HowLeanisPharmaceuticalManufacturing?

A10-YearProgressReport

7 ImpactofInventoryTurnsOnSpeed,Quality,and

Costs

12 LeaningQC:LonzaRollsOutRamanforMaterials

Identication

15 TakingThePlungeToHarmonizePharmaceutical

Regulations

19 ResidualSolventsandaTraceofCooperation:FDA

StepsTowardSafety

19 Video:FieldInspections:NigerianRegulatorsFinda

SolutionforDrugSafety

19 Video:RoughandTumbleRamanandFTIR

MaterialsAnalysis

20 AdditionalResources

Materials saet an analsis:STAYINLAN,COMPLIANT,ANDCOST-FFCTIV

Best Practices for oPtimizing Pharma raw material insPection


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3 Phmu Mufug www.phmmufug.om

How l Phm?so much is to Be gained, yet it is hard to tell whether any drug

manufacturer has truly made Progress over the last decade.

By roBert e. sPector, PrinciPal, tunnell consulting

Lean ManageMent represents one

of the most favored business improvement

programs today. Pioneered by Toyota in the

1950s, Lean focuses on eliminating waste in

new product development, manufacturing, and

distribution in order to cut lead times and in-

vestment, increase exibility, and reduce costs.

Its objectives include using less human eort,less inventory, less space, and less time to pro-

duce high-quality products as eciently and

economically as possible while being highly

responsive to customer demand [1].

As described in a previous article [2] (see p.

7), although there is no universally accepted

measure of a companys Leanness, inventory

turns are a reliable indicator. e trend of

inventory turns over time indicates how well a

company is progressing in terms of becoming

more Lean and improving its processes.

Over the last decade, Lean programs have

become popular in the drug industry, as

evidenced by the number of published case

studies and articles, and conferences devoted

to the topic. Unfortunately, the industry

as a whole has seen little overall progress,

as indicated by the lack of improvement in

inventory turns performance.

Figure 1 is a listing of some of the top drug

companies by 2009 revenue, and representing

brand, generic, and biopharmaceutical

categories. A total of 27 companies werechosen (though not all are listed in Figure

1), consisting of nine biopharmaceutical, 13

brand and ve generic. Annual inventory turns

data was obtained from Morningstar (www.

morningstar.com).

Historically, the pharmaceutical industry has

ranked at the very bottom in terms of the trend

of inventory turns [2]. e average inventory

turns of all the companies observed in this

study has essentially remained at over both

the last ve and 10 year periods (Figure 2). e

brand company average has trended downward

since 2001, but the overall change has been

not been signicant. e biopharmaceutical

company average has shown a slight upward

trend, but it too is not signicant. Finally, the

average for generic companies has shown an

upward trend over the last 10 years, although

during the last two years it has declined. It isimportant to note that the inventory trend for a

single company is indicative but sometimes not

a fair and accurate gauge of excellence in Lean

management. Product recalls, mergers and

acquisitions, etc., as have been commonplace

in the industry over the last while, may skew

inventory performance for a few years. But

while this impacts the grading for a single

company, it washes out in the overall averages.

It is dicult to tell from the data whether

any pharmaceutical company has truly made

progress over the last decade. While there are

some companies that have shown improvement

over the last ve years, there hasnt been

a strong enough trend to draw denitive

conclusions.

Much to gain

Pharmaceutical companies have a lot to gain

depending on their success in applying Lean.

For example, the U.S. electronics sector was

on its deathbed in the early 1980s, but now

has once again become the global leader withthe likes of IBM, Hewlett Packard, and Dell.

ey regained this leadership in part through

application of Lean methods that originated

in Japan, plus adding to this arsenal of process

improvement tools with a western-grown

improvement methodology called design for

manufacturing and assembly (DFMA).

e inventory trends of the U.S. companies

are reective of the Lean improvements that

have been made. In contrast, the long-range

trend lines of two out of three Japanese
http://www.morningstar.com/http://www.morningstar.com/http://www.morningstar.com/http://www.morningstar.com/


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electronics companies have been at or

heading downward [3].As an example of what a successful Lean

program would look like, HP has successfully

applied Lean concepts and has displayed

signicant improvement in inventory trends

over the last decade (Figure 3). From 2000 to

2009, inventory turns improved at an average

rate of 6.9%. HPs upward trend translates

directly into growth of free cash ow at a

rate of 6.9% percent, with interest on the

cash compounded over the 10 year period

of lessening funds tied up in inventory. is

cash may be spent on product development,equipment, pay increases, share buybacks,

dividends, etc.

When measuring the success of a Lean

program, if the companys progress isnt

accompanied by a signicant upward trendin inventory turns, Lean isnt being applied

correctly.

An example of a leader that transformed

another industry is Wal-Mart (Figure 4). In

the 1990s, Wal-Mart was able to increase

inventory turns at an accelerating rate. From

2000 to 2009, inventory turns improved at an

average rate of 2.6% which translates directly

into free cash ow improvement of the same

rate. Wal-Mart was able to transform an entire

industry via their Lean improvement approach

and dictate the requirements to successfullycompete.

e practices of leading-edge companies

have shown the capability to transform

Annual Total Inventory Turns

Company 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

J&J 3.0 3.3 3.3 3.5 3.7 3.6 3.4 3.6 3.6 3.6

Pfzer 2.3 1.9 1.5 2.3 1.2 1.3 1.3 2.0 1.7 1.1

Roche 1.4 1.5 1.5 1.6 1.5 1.9 2.0 2.4 2.3 2.6

GSK 2.1 2.2 2.2 2.2 2.0 2.2 2.2 1.9 1.8 1.8

Novartis 1.9 1.9 2.0 1.9 1.9 2.4 2.5 2.2 2.0 2.1

Sanof-Aventis 1.9 1.6 1.7 1.9 2.0 2.2 2.3 2.2 1.6 2.0

AstraZeneca 1.6 2.0 1.8 1.6 1.7 2.1 2.5 2.9 3.5 3.4

Bayer 2.81 2.77 2.88 2.8 2.9 2.6 2.6 2.6 2.6 2.3

Abbott 3.85 3.92 3.66 3.7 3.3 4.1 3.7 4.0 4.4 4.4

Merck 7.7 8.8 9.5 1.5 2.2 2.9 3.5 3.4 2.7 1.74

Eli Lilly 2.3 2.2 1.7 1.6 1.5 1.7 1.7 1.8 1.8 1.6

BMS 2.4 3.4 4.2 4.8 3.5 3.1 2.9 2.9 3.3 3.23

Amgen 1.7 1.3 1.6 2.1 2.2 1.9 1.3 1.3 1.1 1.0

Teva 2.5 2.3 2.1 2.0 2.2 2.3 2.8 2.1 1.8 1.94

Genzyme 1.94 2.13 1.83 1.9 2.1 2.1 2.2 2.3 5.5 2.6

Averages(27 Companies)

Overall Average 2.36 2.68 2.60 2.48 2.31 2.38 2.43 2.56 2.67 2.33

Brand Average 2.52 3.11 2.96 2.62 2.35 2.31 2.40 2.32 2.62 2.11

Bio Average 2.32 2.34 2.28 2.39 2.24 2.49 2.50 2.64 2.61 2.59

Generic Average 1.80 2.10 2.26 2.23 2.33 2.40 2.40 3.15 2.95 2.47

Data or all fgures courtesy o Morningstar

Figure 1. Inventory Turns of Top Drug Manufacturers


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industries, such as the

electronics exampleabove. Its clear that

pharmaceutical

companies have a lot to

gain depending on how

well they implement Lean

management.

the task

for PharMa

Why hasnt there been

signicant overall im-

provement in the pharma-ceutical industry? First,

implementations have

been isolated to what can

be called pockets of ex-

cellence that are typically

showcased in magazine

articles and at conferenc-

es. Unfortunately many

of these companies have

not been able to consis-

tently apply these concepts

across the entire organiza-

tion.

Second, the majority

of Lean implementations

have been focused on

improving manufacturing

operations, without

an accompanying

focus on the rest of

the supply chain, such

as procurement and

distribution. Withoutfocusing on the entire

supply chain benets

will be limited; long lead

times and high inventories

within external logistics

pipelines tend to cancel

out the greatest Lean

successes in operations.

Finally, many Lean

implementations have

failed for various reasons,

Average Pharma Inventory Turns2000-2009

InventoryTurns

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0.00

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Overall Average Brand Average Bio Average Generic Average

Figure 4. Wal-Mart Ten Year Inventory Turns Trend

Figure 3. HP Ten Year Inventory Turns Trend

Figure 2. Pharma Inventory TurnsTen Year Averages

14

12

10

8

6

4

2

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Turns

10

9.5

9

8.5

8

7.5

7

6.5

6

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


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including and/or are have not

been sustainablecommonproblems across all industries

due to lack of leadership

commitment, excessive cost

reduction focus, improper

project selection and

suboptimal execution [4].

e pharmaceutical

industry has the

advantage of being

years behind other

industries such as

electronics and retail interms of Lean maturity.

By assimilating the

lessons learned from

other industries

pharmaceutical

companies can

improve inventory

turns performance

and achieve the full

benets from Lean

management.

References

1. Spector, R. How Con-

straints Management

Enhances Lean and Six

Sigma. Supply Chain

Management Review,

January/February 2006.

2. Spector, R. Te Impact of

Inventory urns on Speed,

Quality, and Costs. Phar-

maceutical Manufactur-ing, June 2009.

3. Schonberger, R. Best Prac-

tices in Lean Six Sigma

Process ImprovementA

Deeper Look. Wiley &

Sons, 2008.

4. Spector, R. West, M. Te

Art of Lean Program

Management. Supply

Chain Management Re-

view, September 2006.

About the Author

Robert Spector is a Principal withunnell Consulting. He is a certied

Enterprise Lean/Six Sigma (EL/

SS) Black Belt practitioner with 17+

years of management consulting

experience serving both manufac-

turing and service industry clients.

He has successfully led projects and

teams in multiple industries and

sectors, focusing on maximizingbusiness results through strategic

and tactical improvements utilizing

Lean, Six Sigma, and Teory of

Constraints tools and techniques.

Remain Compliant

Thermo Scientifc TruScan
http://www.ahurascientific.com/material-verification/products/truscan/index_digitalads.php?id=1http://www.ahurascientific.com/material-verification/products/truscan/index_digitalads.php?id=1http://www.ahurascientific.com/material-verification/products/truscan/index_digitalads.php?id=1


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Lean ManageMent represents one of

the most favored business improvement pro-

grams today. Pioneered by Toyota in the 1950s,

Lean aims to eliminate waste in every area of

the business, including customer relations,

product design, supplier networks, and factorymanagement. Its objectives include using less

human eort, less inventory, less space, and

less time to produce high-quality products as

eciently and economically as possible while

being highly responsive to customer demand

[1].

Although there is no universally accepted

measure of a companys Leanness, inventory

turns are a reliable indicator. e trend of

inventory turns over time indicates how well a

company is progressing in terms of becoming

more Lean and improving its processes.

How does the pharmaceutical industry rank

on this measure compared to other industries?

Unfortunately, at the very bottom. But by

adopting Lean principles, Pharma companies

can increase inventory turns and not only

achieve signicant nancial benets but also

enhance competitiveness in speed, quality and

costs.

inventory turns as a

Measure of Leanness

Inventory turnoverdefined as the costof sales (also known as cost of goods sold)

divided by the average inventory level over

some time periodis a convenient proxy

measure of Leanness.

Recall that the goal of Lean is to achieve

improvements in t he competitive edge

elements of speed, quality and cost. Lower

levels of inventory directly correlate to

improvement in these competitive edge

factors, as we wi ll show. Thats why Japanese

manufacturers focus intently on reducing

inventory, sometimes characterizing

inventory as evil. Similarly, noted Lean

experts such as Richard Schonberger view

inventory as a catch basin for a multitude of

business ills.

Inventory turns also straightforwardly

correlate with the bottom-line measure

imp of ivoy tu

o spd, Quy, d coBy creating low inventory environments, pharma can estaBlish the

leanness that it sorely lacks.

By roBert e. spector, principal, tunnell consulting

Figure 1. High Inventory Environment

Inventory

27,000 minutes (450 hrs) for total order

Average Inventory

Mins 10,000 20,000 30,000 Time

Order 1,000 Units

C5 Mins/U

B12 Mins/U

A10 Mins/U

Figure 2. Low Inventory Environment

Inventory

13,500 minutes (225 hrs) for total order

AverageInventory

Mins 10,000 Time

Order 1,000 Units

C5 Mins/U

B12 Mins/U

A10 Mins/U


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of business success: cash f lows. Reduced

inventories mean more cash in the bank,freeing up cash that can be used for other

purposes. However, reduced inventories are

beneficial only if the reduction derives from

process improvementthe core of Lean. If a

company cuts inventories without improving

processes, then stock-outs and lost customers

will far outweigh any benefits of increased

cash flows.

In addition, inventory is a standard

financial metric and is readily comparable

company-to-company, as well as over time

within a business. It is also highly visible.Walk around a facility characterized by high

levels of inventory and you can conclude that

the facility is fat, not Lean.

the iMPact on sPeed

e impact of inventory on speed, quality,

and costs becomes clear when a high inven-

tory manufacturing environment is contrasted

with a low inventory environment. Although

there is no absolute measure, comparisons

with competitors can help determine whether

a company is a high inventory or low inventory

operation.

Suppose, for example, a company has an

order for 1,000 units which are manufactured

in a three-step production process that is run

over two shis, 16 hours a day, ve days a week

for a total of 80 working hours per week. In

a traditional high inventory manufacturing

environment (Figure 1), the material might

be released from stores, processed and moved

through the plant in a single batch of 1,000

units. at is, each operation completeswork on the entire batch before any material

is moved to the next operation. Each step

processes and transforms the input materials

incrementally.

In this high inventory example, almost six

weeks are required to complete the order.

Compare that to the results from a low

inventory manufacturing example (Figure 2) in

which Lean principles such as setup reduction,

ow layouts and pull production have been

applied in order to reduce the batch size all the

way through production. ere is no longer

any waiting until each operation is completedfor the entire order before moving it to the

next operation. Material is moved between

operations in batch sizes of 100 units, al lowing

several operations to work on the same

production order simultaneously.

In any production process the slowest

operation acts as the constraint to the system

and sets the throughput rate for the entire

process. In this example, that constraint is

the second operation, with a throughput rate

of 12 minutes per unit. Releasing material

at a rate faster than the slowest operationwill only cause build-up of inventory in the

system. So an additional change must be made:

release material into the system only to keep

the constraint busy versus that of the high

inventory environment in which the entire

order is released to the rst operation.

As a result of these changes, the work-

in-process inventory level is much lower

and the order is completed in half the time.

is phenomenon is also demonstrated by

Littles Law, which shows that lead times

are directly proportional to the amount of

work-in-progress, i .e., inventory. Production

lead times and work-in-progress inventory

are mirror images of each other: reducing

work-in-progress inventory proportionally

reduces lead times. erefore, if a product can

be produced in less time, then capacity has,

eectively, been increasedthat is, the number

of units processed per unit time increases. For

both generic and brand drug manufacturers,

the ability to ramp up quickly to meet surges

in market demand confers a signicantcompetitive advantage.

the iMPact on the cost of QuaLity

To understand the impact of inventory on

quality costs, suppose that an out-of-speci-

cation (OOS) condition occurs at the rst

operation in our example. Unless in-process

inspection is performed, this condition will be

caught only aer the entire lot is processed at

that operation, possibly resulting in the entire

order being scrapped. In this high inventory


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environment the damage will have occurred

at least two weeks (as the rst operation willtake 10,000 minutes to complete) before it is

detected, making it very dicult to determine

what caused the OOS and leading to longer

investigations. Also, the plant will be forced

to expedite additional units because the order

will now be very late. Under this pressure,

management would likely devote its eorts to

expediting rather than nding and resolving

the problem.

In the low inventory environment, even if

QC is not performed until the last operation

is completed, and the damage is not detecteduntil that point, the product is still being

produced at the rst operation. It is therefore

much easier to determine the cause of the

problem without being under pressure to

expedite. Because the problem has been

detected before the entire order has been

produced incorrectly, fewer replacement units

are required and they can be produced much

more quickly than in the high inventory

environmentand without resorting to

expediting. Management also has the time and

ability to eliminate the cause of the problem,

perhaps permanently.

the iMPact on costs

Higher inventories result in greater material

costs, operating expenses and capital expendi-

tures. Recall that quality issues have a greater

impact on a high inventory facility versus one

with lower inventories. In the example here,

an entire production order might have to be

scrapped, increasing material costs. With

shorter lead times than the competition, thelower inventory manufacturer also benets

from a more accurate forecast. For example,

with seasonal drugs such as u vaccines, the

higher inventory manufacturer will have to be-

gin production earlier than the lower inventory

manufacturer. e longer the forecast horizon

becomes, the more dramatically forecast ac-

curacy decreases. Because the lower inventory

manufacturer can start later, it will have a more

accurate forecast and will be less likely to build

excess inventory that may not be sold.

Further, the higher inventory environment

will take longer to process an order thanwill its competitors. Faced with increased

customer demands for faster response time,

the higher inventory facility will have no

choice but to increase production, either

by adding additional shifts or overtime.

With lesser operating expenses, the lower

inventory competitor has a lower break-even

point, giving the company more flexibility

in pricing.

Even increasing the number of shifts or

adding overtime may be insufficient. The

high inventory facility may not have enoughmachines or labor to accommodate the

load within the available time. As a result,

this company may have to invest in more

equipment. With less eective capacity than

the lower inventory competitor, the higher

inventory manufacturer will also have to invest

in new facilities sooner.

Clearly, in the lower inventory environment

the investment in equipment, facilities, and

inventory is much less than that of the higher

inventory environment. Consequently, the

return on investment is much higher.

Where PharMa ranks in

MeasurabLe Leanness

Since 1994, Richard Schonberger has been

collecting inventory-turnover data in a

long-range study of how companies are

progressing with the Lean/process improve-

ment agenda. His study groups about 1,200

companies into 33 industrial sectors. Table

1 lists t he 33 industries in rank order, best

to worst by long-term trend [2]. To assess acompanys performance, its i nventory tu rns

were graphically plotted year by year. A

scoring system reduced this visua l assess-

ment of trends to numbers which point to

long-term Lea n progress.

Pharmaceutical companies rank at

the very bottom. Of 66 pharmaceutical

companies in the Lean database, only two

merit a top grade of A, Johnson & Johnson

and Japan-based Taisho. In fact, according

to Schonbergers research, the average


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score for pharmaceuticals

has been going down since2002.

Why has Pharma ranked

so poorly? When profit

margins were at historic

highs, little attention

was paid to operational

efficiency and production

costs. The focus of

money and resources

in Pharma has

traditionally been

on R&D rather thanoperations. The

little attention that

operations did get was

focused on compliance

rather than process

improvement [3]. The

standard practice of

ensuring that more

than enough of each

product was available

to meet customer

needs coupled with

a lack of attention

to operational

efficiencies has led to

excessive inventories.

Further, the sales and

market-share strategy

of pushing more and

more inventory into

the pipelines has also

driven up inventories.

What PharMa can

do to iMProve

inventory turns

A common objection

to applying Lean in

pharma is that may

work for automotive,

but were dierent. But

consider how a real-

world case study refutes

the objection. A global

pharmaceutical manufac-

turer, facing cost challengesat one of its plants, engaged

consultants to help drive

improvements using several

dierent improvement ap-

proaches including Lean. e

consultants and client team

members worked together to

create a Value Stream map

of the production process.Improvement opportunities

were identied and non-value

added activities were identi-

ed and either eliminated or

minimized. Of critical impor-

tance was the implementa-

tion of a pull system, which

CoSt eFFeCtiVe RmiD



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resulted in lower inventories

and reduced variability in the

production process. Other

Lean techniques such as set-up

reduction were also applied.

Among the results:

Work-in-progress

inventory was reduced by

35%, while production lead

time was reduced by 56%.

Scrap-in-tablet

compression was reducedby 14%, resulting in more

than $1 million savings in

raw material costs.

e conversion cost per

unit was reduced by 22%.

Direct labor productivity

increased by almost 40%.

As in the example here,

lower work-in-progress

inventories correlate directly

to reduced production lead

times, improved qualityand lower costs. Clearly,

Lean principles are as

applicable in pharmaceutical

manufacturing environments

as they are in automotive

and other industries where

they have produced similarly

impressive results.

About the Author

Robert Spector is a principal for

unnell Consulting. He has more

than 17 years of management

consulting experience with a proven

track record in Lean / Six Sigma,

operations excellence, supply chain

strategy, business process design, and

information systems.

References

1. Spector, R. How Constraints Man-

agement Enhances Lean and Six

Sigma. Supply Chain Mgt. Review,Jan./Feb. 2006.

2. Schonberger, R. Best Practices in

Lean Six Sigma Process Improve-

ment. Wiley, 2008.

3. Ibid

Table 1. Lean/Process Improvement by Industry [2]

RankIndustries Ranked

by Industrial Sector

Inventory Turnover Score

1 Petroleum 0.93

2 Paper-converted products 0.89

3 Distributionwholesale 0.86

4 Semiconductors 0.79

5 Electronics 0.77

6 Telecom 0.76

7 Paper 0.72

8 Metal-working/machining 0.71

9 Plastic/rubber/glass/ceramic 0.69

10 Major appliances 0.67

11 Pump/hydraulic/pressure 0.66

12 Vehicular components 0.66

13 Sheet metal 0.66

14 Machinery 0.64

15 Electric 0.61

16 Instruments/test equipment 0.61

17 Aerospace/deense 0.59

18 Personal-care products 0.59

19 Wood (lumber)/paper 0.58

20 Apparel/sewn products 0.56

21 Liquids/gases/powders/grains 0.54

22 Medical devices 0.53

23 Retail 0.53

24 Food/beverage/tobacco 0.53

25 Furniture 0.52

26 Basic metal processing 0.52

27 Motors & engines 0.52

28 Wire & cable 0.50

29 Autos, light trucks, bikes 0.50

30 Chemicals 0.36

31 Heavy industrial vehicles 0.35

32 Textiles/sewn products 0.28

33 Pharmaceuticals 0.02


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as Part of an eort to Lean its raw material

QC process, Lonza Biologics Portsmouth,

New Hampshire facility evaluated several new

spectroscopic technologiesRaman, NIR,

and FTIR handheld or portable devicesfor

rapidly verifying incoming raw materials. e

manufacturer sought to shave signicant timeo its compendial, lab-based sampling and

analysis of materials, without sacricing ID

accuracy and specicity.

Ultimately, Lonza selected handheld Raman

devices (TruScan, marketed by ermo Fisher

Scientic) to roll out in Portsmouth, and to

extend this implementation worldwide to all of

its biologics facilities.

A key factor was the need to have a more

transparent supply chain and harmonized

processes, says senior QC manager for

raw materials, Derek Hubley. Increasingly,

customers prefer materials testing and

specications to be consistent from one site to

the next, he says. We spoke with Hubley about

the project.

PhM: Was raw material ID an obvious candi-

date to be leaned, and if so, why?

D.H.: Both sampling and testing are the

lengthiest activities in the raw material receipt

to release process. So, streamlining this por-tion was obvious. By decreasing the sampling

and testing of raw materials, the supply chain

process becomes more exibleultimately, al-

lowing for a signicant reduction in inventory

carrying costs and raw material lead times.

PhM: Why were inventory carrying costs a

problem?

D.H.: Basically, everything has a lead time as-

sociatedordering, sampling, testing, and re-

lease are all part of the chain of events. So, de-

creasing the sampling and testing t imes would

result in a decrease in the inventory required

for the processes. For example, if we apply a

three-week lead time from the vendor and a

three-week lead time for sampling and testing,

we would need to keep six weeks of materialson-site to support the processes. Using our new

method, we can keep the three-week lead time

from the vendor, but decrease the sampling

and testing time to one week. is results in

the need to carry only four weeks of materials

on-site to support the manufacturing process-

es. In this case, the inventory carrying is cut

by two weeks, and in the case of high-dollar

materials this can be a tremendous savings on

the total inventory carrying cost.

PhM: For accuracy and sensitivity, you

found Raman and NIR to outperform FTIR

for various materials. Can you explain this

dierence?

D.H.: e main reason Raman and NIR

showed better accuracy was the design of the

study. e study was designed to eliminate the

need for sampling raw materials for iden-

tication testing. erefore, the Raman and

NIR could scan through packaging resulting

in greater accuracy and sensitivity. e nalconclusion of the study showed the Raman

having the greatest accuracy and sensitivity and

this was because of its ability to scan through

multiple container types.

An exercise showing the types of materials

that were active using the three technologies

showed most materials were active with all

three technologies. However, this would be if

the analysis was done in direct contact with the

material. ere were a handful of materials that

were active with Raman and NIR, but not FTIR.

lg Qc: loz rou rm fo M i

after evaluating technologies, lonza Biologics is implementing a

raman-Based raw materials identification process.

By paul thomas, senior editor
http://www.thermoscientific.com/truscanhttp://www.thermoscientific.com/truscan


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Materials insPectin


PhM: What surprises did

you encounter in terms ofhow any of the technologies

handled specic materials

(salts, sugars, solvents, etc.)?

D.H.: I guess the biggest sur-

prise was the ability of both

Raman and NIR to distin-

guish between hydrate forms

of materials such as dextrose,sodium phosphate monobasic

XH2O, and sodium phosphate

dibasic XH2O. All other ma-

terials functioned as expected

based on the activity of the

materials in the facility based

on literature review.

PhM: One of the parameters

that you evaluated was theability to create reference

scans. Were all three technol-

ogies capable in this regard?

D.H.: Yes, all three technolo-

gies had the ability to create

reference scans. Both Ra-

man and FTIR only

required one lot of

material to create the

reference scan. FTIR

required direct con-tact with the material,

which we wanted to

avoid, as the ulti-

mate goal is to limit

the contact with the

material. The Raman

reference scan could

be created using a

single lot of material.

However, to make it

robust, the reference

scan was created in

each of the differ-

ent container types

in which the mate-

rial could have been

received into the fa-

cility. For example, a

reference of an amino

acid (dry powder) was

created in a poly bag,

glass container, and

a HDPE bottle; andthe reference scan of

Polysorbate (liquid)

was created in a

clear glass container

and an amber glass

container. As for NIR,

although the capabil-

ity is there, it was not

evaluated during this

study. This is because

it takes more than one


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Materials insPectin

lot of material to obtain a

robust library.

PhM: Your ultimate goal is

to process incoming materi-

als with no sampling, but

are there still some materials

youre testing via traditional

sampling?

D.H.: Yes, there are still

some materials that

would require sam-

pling. is is ultimatelybased on where the

material is used in the

process or if there is a

critical attribute that

needs to be analyzed

for each shipment. For

instance, microbial

safety testing would

always need to be per-

formed if the material

is capable of support-

ing microbial growth.

Also, excipients require

more testing even if the

material is qualied for

a reduced testing strat-

egy. Excipients require

100% container ID, so

the time saved by not

needing to sample 100%

of the containers is sig-

nicant; the remaining

attribute testing wouldbe performed using the

number of containers

required per our statis-

tical sampling plan.

PhM: To what extent

has harmonization

across sites been real-

ized?

D.H.: Currently the

technology is being rolled out

to the biopharmaceutical divi-sions. e materials across the

facilities are common, making

the harmonization eorts

less challenging. In addition,

these facilities have begun

harmonizing specications

and testing procedures so the

challenges were expected.

us far, we have approxi-mately 10 harmonized raw

material specications, which

are shared between sites in the

biopharmaceutical division,

and have deployed the Raman

units to ve sites.

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Materials insPectin

Perhaps the most tangible 21st century symbol

of progress is the electronic common technical

document (eCTD), which a growing number of

companies are now using for their INDs, NDAs,ANDAs, BLAs, and DMFs. Dr. Kumar jokes

about the days when documentation for a new

drug had to be delivered to FDA by truck.

thinking gLobaLLy, acting LocaLLy

But harmonization today is only an outgrowth

of the reality that pharmaceutical regulation has

become an increasingly global aair, since most

of the new drug master les being submitted are

from India, and most APIs are being manufac-

tured in India or China. Two years ago, both

FDA and the U.S. Pharmacopeia began movingoshore, and since have set up satellite branches

in China, India, and Latin America.

USP was the rst to move oshore, which

allowed it to advise FDA when the Agency

established foreign bases as part of its Beyond our

Borders program, says Susan de Mars, USPs chief

documentary standards ocer. As FDA and USP

work together to update compendial test methods,

having an oshore presence only increased USPs

collaboration with FDA, while strengthening

its local connections with regulators, industries

and pharmacopeias, de Mars says. Its part of

our eorts to work outside of ICH regions, and

areas that are part of our PDG, particularly with

countries that have constrained resources, de

Mars says.

PharMacoPeiaL Progress

USPs PDG has made good progress, says de Mars,

and so far has nished harmonizing 27 out of the

34 general chapters that were part of its original

Work Plan, and 40 of 63 excipient monographs.

However, she concedes, its still a slow andlaborious process, and the PDG only covers 15%

of excipient monographs and 20% of the general

chapters within the USP.

However, eorts are also moving forward

with nished drug substances, which are

outside the scope of PDG. In one pilot, USP and

the European Pharmacopeia (EP) are jointly

developing harmonized monographs as well as

reference standards for two drug substances.

is time around, the work will be done from the

beginning, instead of harmonizing retroactively,

as was necessary with PDG.

Pharmacopeial harmonization really began to

take o 10 years ago, when USP decided to focus

on harmonization by attribute. We decidedto look at the main tests and monographsfor

instance, assays and identity testsand focus

eorts on harmonizing where we can agree,

always understanding there will be some cases .

. . where it wont be possible, says Kevin Moore,

senior scientic liaison for USP.

Over that time, there has been good alignment

across USP, EP and JP, although de Mars concedes

that Japan has special challenges, since it publishes

less frequently, has fewer sta members and must

translate everything into English, and then back

into Japanese again.

uPdate on JaPanFor many years access in Japan to drugs approved or use

in the U.S. and Europe lagged by at least our years. In

2007, when only 28 o the worlds 88 best-selling drugs

were available to the Japanese market, Akira Miyajima,

head o the Japanese Pharmaceuticals and Medical De-

vices Agency, said he planned to bring Japans new drug

approvals inline with those o the U.S. and Europe by

2012, and to cut approval times by 2.5 years. The Agency

was to hire 240 new reviewers at the time.

Japans regulatory environment is changing, due to a

change in government leadership, according to Masaru

Kitamuru, who commented in Februarys edition o Whos

Who Legal Lie Sciences Roundtable. Regulators are work-

ing to expedite clinical trials and drug approvals, adding

more requirements or post-marketing surveillance, he

says. Japan has also set guidelines or approving biosimi-

lar products, he says, expecting downward cost presures

and promotion o generics.

Major changes have been seen in the amendment o

the Pharmaceutical Aairs Law, which took eect lastJune, says Satoru Nagasaka, a partner with TMI Associ-

ates. A key change has been implementing risk-based

standards or inormation to the public. The law now cat-

egorizes nonprescription drugs depending on their risks:

Type 1 drugs, which are o particularly high risk (e.g., H2

blocker); Type 2 drugs, which are o relatively high risk,

such as cold medicine; and Type 3 drugs, which are o

relatively low risk, such as vitamin pills. Each drugs level

o risk must now be indicated on the outside o the box,

and regulations on labels and point o sale have been

changed.


17/20

Materials insPectin


is year, USP will decide whether or not to

expand PDG. Still outstanding, Moore says, arechapters on the uniformity of content, mass, and

on instrumental methodology of color. We hope

to have a good amount of progress over the next

year by the time we next meet in June, he says.

aPis and exciPients

Variable active ingredient and excipient qual-

ity are key quality issues being addressed on all

harmonization fronts. USP plans to have a mono-

graph for any excipient listed in FDAs inactive

ingredients database, Moore says, but progress

is challenged by the diverse approaches used to

regulate them, globally. One initiative at USP has

been an international working group establishedfor good distribution practices.

e European Directorate for the Quality

of Medicines & HealthCare (EDQM) has

established bilateral condentiality agreements

with FDA and Australias erapeutic Goods

Administration (TGA) to share condential

inspection information related to APIs and

excipients, and a pilot project for harmonizing

inspections was launched last year.

A number of routes are being considered

either applying GMPs to excipients or

establishing a voluntary program where plantswould be inspected by accredited inspectors

from third-party certied companies. FDA has

recently launched a pilot third-party inspection

program for medical devices.

We still believe that self-regulation for

excipients is the preferred pathway, but we

need to provide best practices and guidance,

says Janeen Skutnik, Chair of IPEC Americas,

and Vice Chair of the IPEC Federation. IPEC

aims to do this by establishing standards and

best practices in the form of guidances. is

approach, she says, allows users to take care of

the basic GMPs, and leaves a companys Audit

teams to focus on the individualized needs of

their use of that excipient. It also allows them to

focus more time on relationship management

and monitoring.

IPEC Americas has been actively converting

IPECs GMPs (not required for manufacturers)

into an ANSI standard that would provideallow

regulators to refer to a universally recognized

benchmark, Skutnik says. e group is also

working on guidance documents for Pedigree,GMPs, GDPs, Excipient Qualication, and

Quality Agreements, and guides for Audits,

Signicant Changes and Certicates of Analysis.

IPEC Americas is meeting with FDA and

USP to ensure consistency of standards and

monographs, Skutnik adds. From the FDA

perspective, they are engaged in the ANSI project

to convert the IPEC-PQG GMP guide into an

ANSI guide. (is work is supported by OMB

Circular A-119). e formal ANSI teams are

being assembled and we expect to complete the

china bridges the gaPChina has been observing ICH activity closely and has

also been working to bring its quality systems and

regulatory standards more in line with those of Europe

and the U.S. Bikash Chatterjee of Pharmatech Associates

notes changes in its approaches to GMP, in this excerpt

from a PharmaManufacturing.com editorial:

In January 2010 the SFDA, Chinas regulatory authori-

ty, attempted to close the gap between its practices and

quality and regulatory standards in the U.S. and Europe

with GMP 10. Updating GMP 8, which had been issued

in 2008, it borrows heavily rom European guidance or

fnished drug products. SFDA is soliciting comments,

both rom within and without China. It is signifcant

because it emphasizes the quality management system,

specifcally on the need or Deviation Control, Corrective

Action and Preventative Action (CAPA) systems and a

Product Quality Review (PQR) system.

In addition to the GMP 10 guidance, the SFDA has also

created an annex to the main guidance which specifes

the requirements or sterile API, sterile manuactur-ing and terminally sterilized product. What is interest-

ing about this document is the specifc requirements

called or concerning acility design and environmental

conditions. To date, the GMP guidances have relied on

a general discussion o the end result, e.g.: Article 6,

Annex 1; The Manuacture o products should be carried

out in clean areas, entry to which should be carried out

through airlocks or personnel and/or equipment and

materials. This has allowed each inspector to interpret

the requirements as they saw ft or each manuacturer.


18/20


Materials insPectin

dras this year, she says.

Additionally, InternationalPharmaceutical Excipients

Auditing (IPEA) has applied

to ANSI to become accredited.

Skutnik expects IPEA to

receive accreditation soon, so

that it could handle third-

party audits.

Managing risk

Harmonization doesnt

mean replication. ere

will always remain dier-ences across regulatory

agencies. For instance,

one can either go the

centralized route for

introducing a new drug

in Europe (via EC) or via

each regional authority.

In addition, drug approv-

als are phased in Eu-

rope, where manufactur-

ers must get reapproved,

based on safety.

FDAs Risk Evaluation

and Mitigation

Strategy, part of the

FDA Amendments

Act of 2007, eectively

harmonizes practices,

closing the gap between

the EU (which requires

postmarketing safety

data) and U.S. (which

hasnt), by askingmanufacturers to collect

patient safety data. So

far, Kumar says, one

drug approved by FDA

has already undergone

REMS. Depending on

the drug involved, the

costs can be high, he says,

running from $50-$100

million for a psychotropic

drug but much less for

niched cancer therapies.

ere will always be dier-ences, too, in such things as

plant inspection practices.

EFPIAs survey noted regional

avors, with FDA focusing on

deviations and investigations,

buildings and facilities, valida-

tion and equipment cleaning

and maintenance. e EU

focused on room classicationsand cleanliness, maintenance,

laboratory controls and qual-

ity agreements, while Japans

inspectors emphasized raw

material and facility cleanliness

and product appearance.

Portable GMP



19/20

Materials insPectin


the Latest FDA Guidance on residual

solvents is interesting on several levels. On the

plus side, this cooperation between the FDA,

USP, and ICH is an excellent example of multi-

national law enforcement and one set of rules

for everybody. In the age of outsourcing andcompanies that are engaged in producing and

selling in many countries (and continents), the

country-to-country regulations that tended to

restrict free trade are slowly disappearing.

In fact, with respect to inter-agency

cooperation, the FDA Guidance even

states, is guidance is intended to assist

manufacturers in responding to the issuance

of the United States Pharmacopeia (USP)

requirement for the control of residual solvents

in drug products marketed in the United

States. Two major product categories are:

1. Compendial drug products that are not

marketed under an approved NDA or ANDA

can comply with USP General Chapter

Residual Solvents and the Federal Food,

Drug, and Cosmetic Act (a.k.a., the Act).

2. Holders of NDAs or ANDAs for

compendial drug products should report

changes in chemistry, manufacturing, and

controls specications to FDA to comply withGeneral Chapter and 21 CFR 314.70.

e residual solvents are given in three

categories by the ICH Q3C Guidance: Class

1, Solvents to be avoided, Class 2, Solvents to

be limited, and Class 3, Solvents with low toxic

potential. ese categories are based on health

experimental hazards.

cLassification of residuaL

soLvents by risk assessMent

(as Per ich Q3c)

e term tolerable daily intake (TDI) is used

by the International Program on Chemical

Safety (IPCS) to describe exposure limits of

toxic chemicals and acceptable daily intake

rdu sov d

t of coopothe new guidelines are evidence of multinational

law enforcement at its Best.

By emil w. ciurczak, contriButing editor

videos

Field Inspections: Nigerian Regulators Find a Solutionfor Drug Safety

Rough and Tumble Raman and FTIR Materials Analysis

Taking sensitive analytical equipment into the feld once

risked damaging equipment and compromising results.

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Materials insPectin

(ADI) is used by the World Health Organiza-

tion (WHO) and other national and interna-

tional health authorities and institutes. e

new term permitted daily exposure (PDE) is

dened in the present guideline as a pharma-

ceutically acceptable intake of residual solvents

to avoid confusion of diering values for ADIs

of the same substance.

Residual solvents assessed in this guideline

are listed in Appendix 1 (Q3C) by common

names and structures. ey were evaluated for

their possible risk to human health and placed

into one of three classes as follows:

Class 1 solvents: Solvents to be avoided.

ese are known human carcinogens,

strongly suspected human carcinogens,

and environmental hazards. As examples

we have Benzene (2ppm Carcinogen),

Carbon tetrachloride (4ppm Toxic andenvironmental hazard), 1,2-Dichloroethane

(5ppm Toxic), 1,1-Dichloroethene (8ppm

Toxic), 1,1,1-Trichloroethane (1500ppm

Environmental hazard).

Class 2 solvents: Solvents to be limited.

Non-genotoxic animal carcinogens or possible

causative agents of other irreversible toxicity

such as neurotoxicity or teratogenicity.

Solvents suspected of other signicant but

reversible toxicities; for instance, acetonitrile

and methanol.

Class 3 solvents: Solvents with low toxic

potential. Solvents with low toxic potential

to man; no health-based exposure limit is

needed. Class 3 solvents have PDEs of 50 mg or

more per day. Some common solvents include

Acetic acid, Heptane, Acetone Isobutyl acetate,

Anisole, Isopropyl acetate, 1-Butanol Methyl

acetate.

ese are the positive points of the

cooperation among agencies. e best way to

address the downside is to refer to Yogi Berra.

Once, when receiving an award (MVP?),

he was quoted as saying, I want to thank

everyone who made this award necessary.

To paraphrase Yogi, the industry would like

to thank al l the countries who made this

Guidance necessary.

As has been seen in recent instances (i.e.,

DEG in toothpaste, melamine in gluten, OSCin heparin), APIs and excipients now need

better and more specic analytical methods

to determine purity. Since more products

are also being made in these countries that

supplied tainted raw materials, newer and

more sensitive methods, along with stricter

limits, are needed. e Guidance from FDA is

another step in the safety of the supply chain

and should be lauded.

additionaL resources

Validation and Regulatory Requirements of Implementing a Raman Technology forRMID and additional Thermo Scientic Material Inspection Webinars

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Three Scenarios for Reducing Raw Material Inspection Costs: How can you cut costs inthe inspection of your raw materials?

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