Most Favored Nation Pricing & Bringing Pharmaceutical Manufacturing Home:

Discussion of high drug prices, shortages and brining pharma manufacturing home has been an ongoing subject and it is discussed in every Congress. Executive orders (too many to cite) have been issued and nothing has changed. Interference besides pharmaceutical companies comes from TORS. Who are TORS? They are Distributors, Regulators, Legislators and Litigators. Each has financial interest and do what they can do to derail any and every progress. 

 

Current administration has issued Executive Orders ^(1,2,3) and we will have to see if anything happens as there are many vested interests in their way to prevent their implementation. Perspective presented is unbiased and not influenced by an for profit and non-profit organization. 

 

To get to Most-Favored-Nation pricing and bring pharma manufacturing home, the current business model along with how pharmaceuticals are distributed in the United States will have to change. All of these are going to be a challenge. Companies with about 2.5 TRILLION dollar revenue (pharmaceutical benefit managers (distribuTORS), pharmaceutical companies, health insurance etc.) will exert every bit use of political influence on (legislaTORS), litigaTORs and RegulaTORS. Reason is very simple. Too much distribution disruption and relearning pharma’s development and manufacturing capabilities can be avoided by money if status quo can bought. However, if the current US administration forces the issue, things will have to change staring from pharma’s methods (product development, manufacturing) and regulatory approval methods. Distribution will be disrupted. Alternate approval methods will have to considered and implemented ⁽⁴⁾.  

 

For the last twenty years I have discussed manufacturing technology issues and published solutions in articles, my blog and books. Manufacturing processes of the Active Pharmaceutical Ingredient (API) and their formulations are bench top processes. I call them round bottom flask and mortar and pestle processes. They could be easily fitted in the equipment of the age and have been the main stay of pharma manufacturing.

Most of the chemical synthesis manufacturing processes and methodologies are batch processes fitted in the existing equipment. Reasons and rational are simple. Minimize investment. There are other ways improve manufacturing process that also minimize investment, discussed in the books. cGMP practices have to followed irrespective of the equipment used. Involvement of the VILLAGE from inception of the product can simplify the manufacturing processes i.e. lower cost. I am not going into the reasons and rationale but internal complacency, tradition and regulatory needs have been an impediment in use of better processing methods ^(5,6,7).  Process of continuous improvement does not exist in pharma manufacturing as each modification has to be approved by the regulators, a very expensive process. Result is companies are afraid to make even minor tweaks to the processes. 

 

To bring pharma manufacturing home and companies to profit their practices have to become current. Very creative and imaginative chemical engineers and chemists at the pharmaceutical companies with the cooperation of FDA can BRING PHARMA MANUFACTURING HOME. No such attempt has been made. Billions are being invested in antiquated methods and manufacturing technologies (too many to cite). These will not deliver what is expected by the current US administration.  

 

If any headway has been made at least it is not obvious. I am not sure about recent announcements for new plants that will come on stream in few years should be a consideration of bringing manufacturing home. This is a harsh observation but is a reality. Question is what do they do for US’s short term needs. It seems more of a public relation ploy in front of legislators and press. 

 

In order to bring manufacturing home, pharmaceutical companies have to proactive and be directed by a Pharma Czar ⁽⁸⁾ who directly reports to the President of the United States. Drug distribution methods and policies will need to be modified. Again undue influence of TORS will have to be warded off.  

 

Fitting processes not only has not only been less productive but also results in high emissions per kilo of the drug. Yes it minimizes investment but there are alternates. They can lower manufacturing costs and they need to be considered ^(4,5,6,9). Involvement of village would be necessary as after the fact ways that have been practiced have to go by the wayside. 

 

I have presented my perspective in the following and good, experienced chemists, chemical engineers and  business folks need to review. They can practice and/or modify to bring manufacturing home and lower drug prices. Following have been presented to bringing pharma manufacturing home and ways to improve profits. 

 

1.     Malhotra, Girish: ONE PAGE Road Map to Reduce Drug Shortages, Assure Quality and Improve Affordability December 6, 2019

2.     Malhotra, Girish: Health and National Security Issues for the USA and Is The United States of America Prepared May 8 , 2020

3.     Malhotra, Girish: A road map for driving pharmaceutical manufacturing back to the USA by 2025 October 8, 2020

4.     Malhotra, Girish: US’s Self Sufficiency for Generic Drugs: A Supply Dilemma and Potential Solutions March 31, 2022

5.     Malhotra, Girish: Roadmap to Reduce Drug Shortages and Bring Pharma Manufacturing Home (US) October 30, 2023

6.     Malhotra, Girish: Remedy of US’s Drug Supply Chain Shortages and Domestic Production of Generic and Brand Drugs April 15, 2025

7.     Malhotra, Girish: An Outlier Plan to Bring Pharmaceutical Manufacturing to USA in One Year April 28, 2025

8.     Malhotra, Girish: Implementing Executive Orders on Domestic Production of Critical Medicines and Achieve Most Favored Nation Pricing June 11, 2025

9.     Malhotra, Girish: An Unconventional Analysis: Can the Wrath of Most Favored Nation Pricing ⁽¹⁾ be Avoided by Bringing Pharmaceutical Product & Process Development and Manufacturing Practices to 21^st Century? July 8, 2025

 

To accomplish the objectives of MFN pricing ⁽²⁾ the MOST IMPORTANT AND CRITICAL item is that every manufacturing change and practice has to come INTERNALLY FROM THE PHARMACEUTICAL COMPANIES as they have command of their culture, process chemistries, understand their manufacturing landscape and every other detail. There are very many vested interests (regulators, consultants, contract manufacturing organizations) that will vie to meddle in but no one knows the business better than folks at the companies. Over the years many have stepped in with no results. Focus has to be razor sharp. Task is not going to be easy unless it is tried and tested internally nothing will change. Companies have the knowledge and what it will take to bring manufacturing home. With the resident talent and application of chemical engineering fundamentals, creativity and imagination the factory costs can be reduced, profits improved and profits improved ^{(5, 6, 7, 8).} We need to exploit them. Change has to come and is overdue. May the FORCE be with you. 

 

Girish Malhotra, PE

 

EPCOT International

 

1.     EO 14293 Regulatory Relief To Promote Domestic Production of Critical Medicines Accessed May 5, 2025

2.     EO 14297 Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients Accessed May 15, 2025

3.     Executive Order 14273 Lowering Drug Prices by Once Again Putting Americans First Accessed June 2, 2025

4.     Malhotra, Girish: ONE PAGE Road Map to Reduce Drug Shortages, Assure Quality and Improve Affordability  Profitability through Simplicity December 6, 2019

5.     Malhotra, Girish:  Active Pharmaceutical Ingredient Manufacturing: Nondestructive Creation De Gruyter April 2022

6.     Malhotra, Girish: Chemical Process Simplification: Improving Productivity and Sustainability John Wiley & Sons, February 2011

7.     Malhotra, Girish: Chapter 4  “Simplified Process Development and Commercialization” in “ Quality by Design-Putting Theory into Practice” co-published by Parenteral Drug Association and DHI Publishing© February 2011

8.     Malhotra, Girish: Profitability through Simplicity

Chemicals tell us how to exploit their behavior for better processes. Clues are ignored. Should we?

  Every chemical that reacts or is soluble or insoluble with another chemical is based on its mutual behavior. My conjecture is that this statement will make most of chemists and chemical engineers ponder “what is the point of this statement/discussion?”. We, humans, are social people who exploit mutual relationships to create excellent affiliations in business, sports and personal adventures. Reality is that chemicals have a mutual behavior and generally it is least understood/exploited in process development. We generally do not exploit and take advantage of their relationships. Having an understanding leads to better economic process and higher quality products ⁽¹⁾. In the following I am sharing opportunities I see for excellent processes. Anyone can explore similar opportunities. Perspective presented is my own and not influenced by any external for profit and nonprofit organization.  

 

Due to lack of understanding/exploitation of the relationships quality of the resulting products is assured by repeated in-process and final products analysis i.e. QbA (Quality by Analysis). This is time consuming and expensive effort and lowers profits. It is manifestation of lack of command of the manufacturing process. If the processes were designed such process designers have total command of everything that happens and produces quality product no repeated analysis would be necessary i.e. it will be a QbD(Quality by Design) process. Even with this understanding readers who are more experienced and knowledgeable may be stymied by two alphabets that stand between “A” and “D”. They are “B” bureaucracy (regulators) and “C” concern for not following tradition ⁽²⁾.  

 

Value of taming of interaction and mutual behavior of chemical is incalculable as it has extremely high impact on manufacturing process, product quality and company profitability. Volumes have been written on the subject. Effort can significantly lower solvent emissions per kilo of active pharmaceutical ingredient (API) ^{(3, 4)}.Through publications attempt has been made share similar perspective ^{(5,6,7,8, 9)}. 

 

In order to capitalize on mutual behavior of chemicals one has to know and understand chemical and physical properties of every chemical used and produced in each reaction ^{(5,6,7,8, 9)}. Costs of raw materials and process have to be understood as they dictate the product economics. Familiarity with process equipment used is critical.

 

Process developers at the laboratory stage do not think and/or exploit chemical and physical properties in the laboratory. Purpose is to develop a laboratory process. Thought of scale-up and commercialization does not enter in the picture at this stage. Conservation regarding a manufacturing process which should begin at inception of the process development but generally is not a consideration ^{(5, 6, 7)}. Mass balance and mutual behavior of physical properties has to be understood. It is important as they lead to process optimization. Many developers are generally not familiar with manufacturing processes and product costs. 

 

As stated earlier thought of scale-up and commercialization does not enter in the picture at the laboratory stage. Imagination and experience in scaleup of a process can contribute. Involvement of Village ^{(5, 6, 7)} from process inception accelerates process development and commercialization. It is an opportunity that is generally ignored but needs to be considered. Following examples illustrate value of physical properties and their mutual behavior. They can be capitalized on to create excellent QbD processes. They have been reviewed ^{(5,6,7,8, 9)} and in other publications, too many to cite.    

Gabapentin:

 

Preparation of Gabapentin is an example of exploiting mutual behavior and physical properties. Its synthesis is illustrated in Figure 1 where mutual behavior of chemicals can be exploited. Review of the filed patent  US20080103334A1⁽¹⁰⁾ and other patents suggest solvent use. This is normal for every laboratory process development. 

 

Figure 1: Synthesis of  Gabapentin ⁽¹⁰⁾

Physical properties of the raw materials (Table 1) suggest that the solvent use can be minimized and/or eliminated. This proposition is based on a process that was commercial about seventy years ago, still in use, to produce a product of similar chemistry at an approximate rate of 1,600 kilos per hour operating about 7,140 hours per year (i.e. about 11,000 MT per year), a continuous process ^(5,11). Except for water no organic solvent was used.

 

Global demand for Gabapentin is about 3,135 MT per year ⁽¹²⁾. One or two plants can produce the product at about 220 kg/hour rate operating bout 7,140 hours per year. However, currently about 70 produce the global demand ⁽¹³⁾ operating limited hours per year. In their effort they most likely use and generate significant amounts of solvents per kilo of product and even after recovery and re-use have significant impact on our environment. Due to cGMP and cleaning practices asset utilization estimated at 50% on high side ⁽¹⁴⁾.

 

Chemical name	1,1-Cyclohexanediacetic Anhydride	1,1 Cyclohexane diacetic mono amide	1-(aminomethyl) cyclo hexaneacetic acid (Gabapentin)
CAS number	1010-26-0	99189-60-3	60142-96-3
Chemical Formula	C10H14O3	C10H17NO3	C9H17NO2
Molecular Weight	182.22	199.25	171.24
Melting Point, °C	70	145 -148	162-166
Boiling Point °C	126	443.6±18.0 predicted

 

Table 1: Properties of chemicals used and produced in Gabapentin

 

Process that is similar to the chemistry in Figure 1 had the anhydride fed as a melt with stoichiometrically controlled addition of liquid ammonia. Use of liquid ammonia eliminated water as a solvent. Melt acted as a solvent for the next step ⁽⁵⁾. Resulting amide was reacted with in-situ produced chlorine and feed stoichiometrically. Intermediate produced was converted to the product by stoichiometrically controlled acidification. Details are not discussed. 

 

Continuous conversion of 1,1-Cyclohexanediacetic Anhydride  to 1,1 Cyclohexane diacetic mono amide to produce Gabapentin would be an excellent and simple process. Its processing conditions will have to be optimized and can result in an excellent continuous process. Figure 2 is conceptual manufacturing process scheme for Gabapentin. Similar chemistries have been commercial. As stated earlier details are not discussed. 

Figure 2: Continuous Gabapentin Manufacturing Process

 

In the proposed continuous process 1,1-Cyclohexanediacetic Anhydride would be metered as a liquid along with liquid ammonia in required stoichiometric ratio. Formed amide would be converted to Gabapentin using chlorine based bleach that will be produced inline and fed to the reaction system. Chlorine based bleach is significantly cheaper than bromine based reactant. Bleach will have enough water to slurry the product for subsequent processing. The proposed process would need necessary development work to have an optimum process. Pfizer did attempt to green its batch process ⁽¹⁵⁾. 

 

Process for Piperine Intermediate:

Discussed below is an example two steps for the process to produce Piperine ⁽¹⁶⁾ intermediate, Figure 3. Chemistry and physical properties suggest that the first two steps could be a solventless process. Any astute chemist and chemical engineer should consider all liquid process to produce (2E)-1(piperidinyl)-2-buten-1-one which is a liquid.  

Figure 3: First two steps of USP 11,267,798 B2 ⁽¹⁶⁾

 

Chemical  Name	Crotonic acid	Thionyl Chloride	Crotonyl chloride	Piperidine	(2E)-1(1-piperidinyl)-2-buten-1-one
CAS Number	107-93-7	7719-09-7	10487-71-5	110-89-4	3626-69-5
Chemical Formula	C4H6O2	SOCl2	C4H5ClO	C5H11N	C9H15NO
Molecular Wt.	86	119	104.5	85	153
Melting Point, °C	70-73			-7	(-ve) 3-5
Boiling Point, °C	185	76	121-123	107	~295

 

      Table 2: Properties of chemicals used and produced in USP 11,267,798 B2 ⁽¹⁵⁾

 

Once the chemical physical and chemical properties of the reactants and intermediates are understood, it is very feasible to create a safe and simple commercial process. In every reaction step solubility and insolubility of chemicals used matters and attention has to be paid as it can lead to significant process optimization and reduction of solvent use leading to “Net Zero ^{(3, 4)}”. 

 

Most of the fine/specialty chemical and their subset API plants have sufficient idle equipment that can be assembled for batch or continuous processes. Creativity and imagination and Village’s ^{(5, 6, 7)} support would be needed. Yields of many products could be higher ^(9,17) and processes can be simplified. Effort will be necessary for innovation and better methods. 

If what all has been discussed ^{(5, 6, 7)} above is applied for product and process development any product that has an annual demand of about 50 to 100+ Metric Tonnes per year per site can be produced using a continuous process ^{(5, 11)}. A concerted effort would be needed. Solvent use could be reduced and overall productivity improved. Chemists and chemical engineers have to exploit and apply all of their knowledge and learning. Process design will require every bit of creativity, imagination to capitalize mutual behavior of chemicals used and produced ^{(5, 6, 18, 19, 20, 21)}. Using the methods reviewed above batch processes for new brand and generic products can be optimized along with lower commercialization time and will have lower “Net Zero” ^(3,4) impact than the current batch processes. Judicious ROI analysis will have to be done. Another benefit of such designs will be that product demands can be addressed very quickly resulting no or minimum shortages.

 As suggested earlier incorporation of the suggested/proposed methods is not going to easy. Traditions of the last seventy plus years used to manufacture API will come in the way. Desire to change has to come from within each company and has to be acceptable to the regulators who are not familiar with discussed chemical synthesis methods and manufacturing practices. My hope is that simplicity of processes and improved asset utilization will lead to consistently superior quality products and higher profits will be the driver for their adoption. Time will be the spokesperson.  

 

Girish Malhotra, PE

 

EPCOT International 

1.     Malhotra, Girish: Sociochemicology May 30, 2013 Accessed January 13, 2023

2.     Malhotra, Girish: Alphabet Shuffle: Moving From QbA to QbD - An Example of Continuous Processing, Pharmaceutical Processing, February 2009 pg. 12-13

3.     Burke, J. What does net zero mean? https://www.greenbiz.com/article/what-does-net-zero-mean, May 2, 2019 Accessed April 27, 2021

4.     Sheldon R.A. The E factor 25 years on: the rise of green chemistry and sustainability, Green Chemistry https://pubs.rsc.org/en/content/articlelanding/2017/gc/c6gc02157c/unauth#!divAbstract , 2017, 19, 18-43 Accessed February 17, 2021

5.     Malhotra, Girish: Active Pharmaceutical Ingredient Manufacturing: Nondestructive Creation De Gruyter April 2022 Accessed May 24, 2023

Malhotra, Girish: Chemical Process Simplification: Improving Productivity and Sustainability, John Wiley & Sons, February 2011 Accessed May 24, 2022

7.     Malhotra, Girish: Chapter 4 “Simplified Process Development and Commercialization”  Quality by Design-Putting Theory into Practice co-published by Parenteral Drug Association and DHI Publishing© February 2011 Accessed May 24, 2022

8.     Malhotra, Girish: Profitability through Simplicity June 15, 2023 Accessed May 24, 2023

9.     Malhotra, Girish: Considerations to Simplify Organic Molecule (API) Manufacturing Processes: My perspective, Profitability through Simplicity April 20, 2019 Accessed May 24, 2023

10.   Kumar, A. et. al. IPCA Laboratories Process for Synthesis of Gabapentin USP 20080103334A1, Published May 1, 2008 Accessed June 6, 2023 

11.   Continuous Production https://bit.ly/2Rp3Xlu Accessed June 5, 2023

12.   Kumar, S. Top Ten Most Produced API in India https://www.linkedin.com/posts/apibusinessanalyst_top-10-most-produced-apis-in-india-in-2022-activity-7068750309526781953-frPN?utm_source=share&utm_medium=member_desktop Accessed June 1, 2023

13.   Gabapentin Indian API Producers https://www.pharmacompass.com/active-pharmaceutical-ingredients/gabapentin, Accessed June 1, 2023  

14.   Benchmarking Shows Need to Improve Uptime, Capacity Utilization, https://www.pharmamanufacturing.com/articles/2007/144/ Sep 20, 2007, Accessed May 19, 2020

15.   Liam Tully, Green API Manufacturing, Pharmaceutical Technology, Volume 33, Issue 9, pp. 46-48 Accessed December 9, 2009

16.   Phull M.S. et. al. Process for the Preparation of Piperine US 11,267,798 B2 March 8, 2022 Accessed June 12, 2023

17.   Malhotra, Girish : Capitalizing on Mutual Behavior and Chemical Reactivity of Chemicals, Profitability through Simplicity, May 29, 2023 Accessed June 6, 2023

18.   Malhotra, Girish: Considerations to Simplify Organic Molecule (API) Manufacturing Processes: My perspective, Profitability through Simplicity, April 20, 2019 Accessed June 5, 2023 

19.   Malhotra, Girish: Review of Continuous Process for Modafinil, Continuous Processing in the Chemical and Pharmaceutical Industry II, 2009 AIChE Annual Meeting, November 10, 2009,Nashville, TN. 

20.   Malhotra, Girish: Analysis of API (Omeprazole): My perspective, Poster Session: Pharmaceutical Engineering, 2009 AIChE Annual Meeting, November 11, 2009, Nashville, TN.

21.   Malhotra, Girish: Art and Science of Chemical Process Development & Manufacturing Simplification, AIChE.org May 17, 2023 Accessed June 10, 2023