Pharmaceutical supply chains and processes have been subjected to some fairly severe stresses over these last few years.
It’s an ongoing problem, as LGM Pharma’s Senior Vice President Business Development & Operations Hamilton Lenox noted in this recent CPhI article on the state of pharmaceutical supply chains:
“As the global economy recovers from the COVID-19 pandemic, the world is experiencing increased shortages of products and raw materials, longer lead times, disruptions in shipping, and significant cost increases. Prices are rising at the fastest pace in nearly 40 years, which translates into higher prices (and longer lead times) for drug substance and drug product services.”
Nearly all small and large industry participants are at least partially dependent on outsourcing supplier partnerships. Standalone success is rarely possible since breakdowns in supplier compliance failures can directly affect the businesses of dependent partners.
According to Lenox, supply disruption, closures and regulatory shutdowns remain major risks beyond the extraordinary circumstances (e.g., pandemic, Suez Canal, Ukraine) we’ve seen disrupt our supply chains.
As the industry turns toward multi-sourcing, near-shore manufacturing and other mitigation strategies, supplier visibility has become a core benchmark for drug supply chains. With quality failures ranking high as a risk, thorough supplier vetting has become a priority.
Consequences of Quality Failures
In pharma, a quality failure can have a devastating impact—both on pharmaceutical companies and on the consumers that will eventually use their products. To protect the integrity of drug products, regulatory agencies, such as the Food and Drug Administration (FDA) specify significant ramifications for offending pharmaceutical companies. Drug manufacturers that incur quality failures risk receiving FDA 483 letters, or facing consent decrees, recalls, and even facility shutdowns.
What are the implications of each?
The FDA issues Form 483 to the management of a non-compliant pharmaceutical firm following an inspection where an investigator has observed practices or conditions deemed unacceptable based on the Food Drug and Cosmetic (FD&C) Act. Infractions are identified in cases where the drug is being manufactured, packaged, or handled in an environment or manner that could lead to bodily harm or product adulteration.
In the drug industry, a consent decree is used to recognize the agreement between the pharma manufacturer and the FDA. The agreement prevents the manufacture or distribution of a pharmaceutical product until a third party has confirmed that the drugmaker has met regulatory standards and is sustaining compliance.
To protect consumers from harmful or defective pharmaceutical products, drug companies may issue recalls. These actions remove a potentially dangerous product from the market, but recalls can have dire financial implications.
Significant interruption of business from a facility shutdown poses an enormous financial risk to the industry.
Since 2000, the pharmaceutical sector has lost approximately $12 billion due to shutdowns attributed to process deficiencies. A facility that has been shut down may be unable to resume operations until it can prove remediation of the shutdown’s cause, and demonstration of current (and ongoing) compliance.
Supply Chain Management to Reduce the Risk of Quality Failures
Quality issues that result in noncompliance can occur at any point along a pharmaceutical supply chain. But these problematic incidents are not inevitable.
Careful drugmakers are reducing the risk of quality failure through proper supply chain management (SCM). The objective is to increase supply chain transparency and visibility.
As we locate and qualify suppliers, LGM Pharma often facilitates these transparency interactions. As a partner to our drug company clients, our task is to mitigate the risk of quality failures by screening and eliminating material suppliers with violative practices.
Maintaining Quality During the Era of COVID-19
With the prevalence of COVID-19, the pharma industry has had to navigate a new supply chain landscape in which lead time challenges and issues with inconsistency have surfaced. Impacting the industry’s overall ability to meet on-time goals has been the Great Resignation, with declines in available industry workers. Higher turnover can be a precursor to a rise in quality issues, as training struggles to replace experience.
Although the pandemic reduced workforce availability, it also offered new opportunities. It is undeniable that COVID encouraged reliance on – and the expansion of – the pharmaceutical industry.
This placed even greater demands on already-limited resources. Still – even as the pandemic has gradually turned endemic – the continuity of manufacturing supplies remains necessary for quality assurance. Supply chain management teams have responded by zeroing in on supplier quality.
Forward-thinking companies are working with innovative CDMOs like LGM to increase their pool of approved suppliers and create redundancies. A partner focused on verifying the reliability of supplier processes and systems can help circumvent the quality concerns encountered with less stringent suppliers.
Start with Supplier Prequalification
Companies must be able to identify qualified suppliers upfront. To ensure that drugmakers are presented with only the highest quality partnership options, a prequalification process is necessary. What should this prequalification seek to uncover?
Screen suppliers to confirm:
- The supplier has a clean history of cGMP compliance.
- Systems and processes are present to protect product quality.
- The supplier has not violated regulatory requirements from governing agencies.
- Procedures that protect data integrity are already in place, ensuring CFR Part 11 compliance.
- The current capacity utilization is suitable for the needs of the customer.
- The supply of active pharmaceutical ingredients (API) is scaled throughout the production and commercialization process.
- The supplier has a drug master file (DMF) for the API.
Supplier qualification is an ongoing process. New supplier candidates should be regularly added to increase the availability of manufacturing supplies and ensure supply continuity in the event of an unforeseen problem.
Quality supply management teams know that last-minute planning is not a wise strategy. By offering backup suppliers to customers, an experienced supply chain manager can prevent material shortages and ensure that quality components are on-hand when needed.
Industry professionals are aiming to meet the increased global demand for quality pharmaceutical products without sacrificing product or process safety and regulatory compliance. The current value of reliable supply chain partnerships is higher than ever.
Learn how LGM Pharma can help secure your supply chain and take the complexity out of API sourcing.