Improving manufacturing efficiency is an immense opportunity for Pharmaceutical Companies says EIU

By Finfacts Team
Oct 9, 2005, 17:28

Pharmaceutical manufacturing-the production processes through which companies turn discoveries into compounds for the mass market-is gaining in importance relative to R&D and marketing, according to a new white paper by the Economist Intelligence Unit, sponsored by Oracle.

Decades of regulatory and industry standard practice are being reworked to help push operating efficiency in pharmaceuticals closer to the standards of other industries such as semiconductors, industrial chemicals, and even consumer packaged goods. The findings were based on interviews with senior businesspeople and regulators in the industry.

Both regulators and industry practitioners agree that things have to change to raise pharma's manufacturing productivity while maintaining safety and quality. Compared with other industrial sectors such as petrochemicals, there has been a very slow rate of introduction into pharmaceuticals of modern process design principles, measurement and control technologies, and knowledge management systems. According to a 2001 report for the US Food and Drug Administration (FDA) that is cited in the Economist Intelligence Unit paper, the potential worldwide cost-savings from efficiency improvements in pharma manufacturing could be as high as US$90 billon a year, the equivalent to the cost of developing 80-90 new drugs annually.

Now, leading pharmaceutical manufacturers are beginning to adopt proven best practice methodologies such as Lean Manufacturing and Six Sigma. These quality management techniques are being combined with new Process Analytic Technologies (PAT) to improve quality on the factory floor.

The key findings:

Quality must be designed from the front end, not tested on the back end.
In-depth interviews with leading figures at the FDA and in the pharmaceutical industry confirm that significant changes in organisation, and even production philosophy, are required in order for the industry's manufacturing model to move from a focus on testing to a focus on design.

Lean/Six Sigma/PAT are being used to complement existing quality efforts.
These frameworks are being grafted onto existing manufacturing quality initiatives. Lean/Six Sigma are methods for looking strategically at how a business can create value. PAT furnishes a process and technical toolkit for building in quality improvements on the factory floor. Both are needed.

Managing information is as important as mixing chemicals.
Flowing parallel with chemical and biological compounds is the reporting and paperwork inherent in a heavily regulated industry such as pharmaceuticals. Internal, regulatory and operations data are often fragmented, requiring a consolidated view of production and distribution to help optimise the manufacturing process while providing a rigid audit trail to help ensure safety.

Manufacturing efficiency can raise general efficiency.
Early pioneers are discovering that lessons learned in manufacturing can be applied to other corporate processes, such as research & development and even accounting, that can raise the overall efficiency of a drug company.