Patents are filed to preserve intellectual property for the duration of the patent life. This is the fundamental right of every inventor as they protect their invention from competitors and gives them competitive advantage. Pharmaceuticals have relied on this right to preserve their inventions. These patents are a treasure trove for the competitors and folks who want to violate someone else’s intellectual property.
Fine/specialty chemicals and coatings are generally commodity products and relative to pharmaceuticals do not face many contentious patent battles. However, due to high profit margins, the patent game is very different for the pharmaceuticals.
Tradition has been that when filing patent for a new chemical molecule generally extensive information about different synthesis paths that have been explored and could be used to manufacture the new molecule are included in the patent. The intent is to block competitors from making the same chemical by the routes that have been used and suggested in the patent. Information disclosed in the patents is of significant benefit to the competitors and/or other inventors to create processes that are better than the ones created by the original inventor/s.
With the changing economic global landscape the World Trade Organization (WTO) membership has grown. Suddenly the global creative pool has expanded multifold. Creative minds in the developing countries have started to exploit the knowledge in the public domain. Internet has been a boon to their creativity and imagination. They are able to reduce their process development time as they judiciously use the knowledge that is easily available. They are also able to develop and create processes and chemistries that are simpler and cheaper than the original invention. Ten years ago all this was unthinkable.
Generics as well as brand companies are using different strategies to capitalize on such fetes. Knowledge is being effectively used to challenge pharmaceutical patents following Hatch-Waxman Para IV provisions. Patents from competitors are being used to prevent cost reduction of existing products. Generics have enjoyed significant benefits through “pay for delay” and other collaborations. It is well known that “pay for delay” is being used to delay generic entry i.e. lower costs for the consumer. I call the patents and contained information a double edged sword.
As the global pharmaceutical playing field changes, businesses have to address a question. Any company that has invented a new molecule to cure a disease will file a patent. It has to give a method of synthesis but does it have to give its alternate routes from literature. By giving minimum information it would make the literature search for others a challenge. Inventor company would have developed proprietary manufacturing process/s. They are company’s confidential information and can be protected through proper documentation. Point is why make things easy for competitors in this competitive world. I have relied on such confidentiality and been able to protect the synthesis methods and associated technologies.
Patent attorney’s would defend what has been the tradition. Business people have to decide what should be path forward while considering the advice of their patent counsel. My conjecture is that least shared is most protected and could prevent patent invalidation/challenges based on synthesis routes. Any strategy that challenges competitors is an advantage for me. Anyone can chime in with their opinion.
Girish Malhotra, PE
EPCOT International
Pharmaceutical, Specialty and Fine Chemicals and Coating process and manufacturing technologies have to be simple to have the best possible process. Processes have to be safe and best of the methods need to be included to minimize the environmental impact due to air, water or soil discharges. Conservation is a necessity. Simple and good technology will result in a profitable and consistent quality product. This is the intent of every developer, chemist and chemical engineer.
Tuesday, February 8, 2011
Friday, October 15, 2010
Pharmaceutical Companies Can Innovate If They Want To
Pharmaceutical companies including API (active pharmaceutical ingredient) manufacturers have an uphill battle to achieve manufacturing perfection that will deliver quality product without regulatory oversight. I believe that the industry has created this regulatory juggernaut due to its inability to produce consistent and repeatable quality products.
Recent case of Johnson and Johnson was a failure of manufacturing and financial controls that are the fundamentals of good business. There are other similar incidents where the products were contaminated. Due to such repeated occurrences, regulatory noose gets tighter. Since industry created the juggernaut, it can and has the ability to loosen the noose provided it “rights” its practices.
Since the drugs are for human consumption, the manufacturers have to be reined in to assure quality. This has led to the establishment of “do and don’t” guidelines i.e. analysis paralysis. Industry besides inventing new molecules is more focused on how to meet and comply with the guidelines and regulations rather than developing and commercializing processes that are based on “best of the best” physical and social sciences (chemistry, physics and economics) i.e. chemical engineering.
Brand companies have lived with speed to market. Since they can make their financial margins and generics will take over the business, their thinking has been to invent new molecules and not to invest in new and better manufacturing technologies for the products that are short lived in their stable.
There are other factors that inhibit pharmaceutical companies to have the “best of the best” manufacturing processes for the manufacture of drugs. They are:
1. Drug pricing is based on the highest price customer will pay. Since companies can achieve their financial goals, there is no economic incentive to improve manufacturing technologies.
2. Due to drug dosage, annual volume of the drug per plant per year can be very low.
3. Companies have relied on fitting the process in the existing equipment. This has not resulted in having an optimum process for the products and can result in variable product quality. This is one of the causes that have lead pharmaceutical companies to the current state.
4. Ability to pass on the costs associated with inefficient processes to the customers.
5. Lack of competition during the patent period and also after the patent expiration. Later is due to the regulatory and other economic challenges companies have go through to commercialize drugs. Unless the volume is very large few venture the field.
6. Ability of the companies to recall any “off-spec” products from the market without much retribution.
All of the above collectively and individually can be overcome if the companies create excellent processes based on good physical sciences for the “new products only”. If done right they will improve the total business process such as inventory turns, minimize in-process testing and accumulation of intermediates.
Regulatory and financial investment is a deterrent to manufacturing technology innovation for the existing products. However, Generics can innovate manufacturing technologies for existing products as well as the products that are transitioning out of patent i.e. new generic products. They have incentive as they are there for the long haul.
There are possibilities and opportunities. We have to look at them individually and collectively. Some of them are listed as follows.
1. Improving raw material inventory turns by ensuring raw materials do not have to be tested and can be used “just in time”. There are ways this can be accomplished.
2. Improving and/or eliminating intermediate isolation and storage by completely eliminating in-process sampling and testing i.e. the process will have to be perfect and repeatable at every step.
3. Use of high-powered analytical instrumentation during development of API and drug formulation is necessary. However, we need to develop tests that are simple to give us the necessary answers in the shortest time. We do not need a rocket launch procedure when we can walk ten feet or need to use a Lamborghini when a bicycle would suffice.
Many of the puritans might not agree with my simplifications and perspective. Unless we try to simplify and take command of the processes and produce repeated quality product, regulations will prevent us from manufacturing innovation and simplification. Many of us may remember the jingle “Try it, You'll Like It”.
A systematic and well-orchestrated methodology can be developed and incorporated for pharmaceutical manufacturing. All of the elements exist. If done properly we can move from regulation-based manufacturing to science based and driven manufacturing. Science based technologies will produce consistent and repeatable quality product that will become the norm rather than the exception. Total business process (inventory turns, cash flow and capital investment) will improve and be simplified. In addition, processes will be economic and sustainable.
Girish Malhotra, PE
EPCOT International
Related Articles:
1. Malhotra, Girish: The Path Towards Continuous Processing, Pharmaceutical Processing
2. Malhotra, Girish: Process Centricity is the Key to Quality by Design, Profitability through Simplicity April 6, 2010
3. Malhotra, Girish: Pharmaceutical Costs, Technology Innovation, Opportunities and Reality, Pharmaceutical Processing, February 2010 pgs 20-24
4. Malhotra, Girish: Alphabet Shuffle: Moving From QbA to QbD - An Example of Continuous Processing, Pharmaceutical Processing, February 2009 pg 12-13
5. Will Chemical Engineers Save Pharma? Pharmamanufacturing.com April 10, 2009
6. Malhotra, Girish: API Manufacturing: A Road Map for Green Chemistry and Processes; pharmaQbD.com October 14, 2008
7. Malhotra, Girish; API Manufacture-Simplification and PAT; Pharmaceutical Processing, November 2005, Pages 24-27
Recent case of Johnson and Johnson was a failure of manufacturing and financial controls that are the fundamentals of good business. There are other similar incidents where the products were contaminated. Due to such repeated occurrences, regulatory noose gets tighter. Since industry created the juggernaut, it can and has the ability to loosen the noose provided it “rights” its practices.
Since the drugs are for human consumption, the manufacturers have to be reined in to assure quality. This has led to the establishment of “do and don’t” guidelines i.e. analysis paralysis. Industry besides inventing new molecules is more focused on how to meet and comply with the guidelines and regulations rather than developing and commercializing processes that are based on “best of the best” physical and social sciences (chemistry, physics and economics) i.e. chemical engineering.
Brand companies have lived with speed to market. Since they can make their financial margins and generics will take over the business, their thinking has been to invent new molecules and not to invest in new and better manufacturing technologies for the products that are short lived in their stable.
There are other factors that inhibit pharmaceutical companies to have the “best of the best” manufacturing processes for the manufacture of drugs. They are:
1. Drug pricing is based on the highest price customer will pay. Since companies can achieve their financial goals, there is no economic incentive to improve manufacturing technologies.
2. Due to drug dosage, annual volume of the drug per plant per year can be very low.
3. Companies have relied on fitting the process in the existing equipment. This has not resulted in having an optimum process for the products and can result in variable product quality. This is one of the causes that have lead pharmaceutical companies to the current state.
4. Ability to pass on the costs associated with inefficient processes to the customers.
5. Lack of competition during the patent period and also after the patent expiration. Later is due to the regulatory and other economic challenges companies have go through to commercialize drugs. Unless the volume is very large few venture the field.
6. Ability of the companies to recall any “off-spec” products from the market without much retribution.
All of the above collectively and individually can be overcome if the companies create excellent processes based on good physical sciences for the “new products only”. If done right they will improve the total business process such as inventory turns, minimize in-process testing and accumulation of intermediates.
Regulatory and financial investment is a deterrent to manufacturing technology innovation for the existing products. However, Generics can innovate manufacturing technologies for existing products as well as the products that are transitioning out of patent i.e. new generic products. They have incentive as they are there for the long haul.
There are possibilities and opportunities. We have to look at them individually and collectively. Some of them are listed as follows.
1. Improving raw material inventory turns by ensuring raw materials do not have to be tested and can be used “just in time”. There are ways this can be accomplished.
2. Improving and/or eliminating intermediate isolation and storage by completely eliminating in-process sampling and testing i.e. the process will have to be perfect and repeatable at every step.
3. Use of high-powered analytical instrumentation during development of API and drug formulation is necessary. However, we need to develop tests that are simple to give us the necessary answers in the shortest time. We do not need a rocket launch procedure when we can walk ten feet or need to use a Lamborghini when a bicycle would suffice.
Many of the puritans might not agree with my simplifications and perspective. Unless we try to simplify and take command of the processes and produce repeated quality product, regulations will prevent us from manufacturing innovation and simplification. Many of us may remember the jingle “Try it, You'll Like It”.
A systematic and well-orchestrated methodology can be developed and incorporated for pharmaceutical manufacturing. All of the elements exist. If done properly we can move from regulation-based manufacturing to science based and driven manufacturing. Science based technologies will produce consistent and repeatable quality product that will become the norm rather than the exception. Total business process (inventory turns, cash flow and capital investment) will improve and be simplified. In addition, processes will be economic and sustainable.
Girish Malhotra, PE
EPCOT International
Related Articles:
1. Malhotra, Girish: The Path Towards Continuous Processing, Pharmaceutical Processing
2. Malhotra, Girish: Process Centricity is the Key to Quality by Design, Profitability through Simplicity April 6, 2010
3. Malhotra, Girish: Pharmaceutical Costs, Technology Innovation, Opportunities and Reality, Pharmaceutical Processing, February 2010 pgs 20-24
4. Malhotra, Girish: Alphabet Shuffle: Moving From QbA to QbD - An Example of Continuous Processing, Pharmaceutical Processing, February 2009 pg 12-13
5. Will Chemical Engineers Save Pharma? Pharmamanufacturing.com April 10, 2009
6. Malhotra, Girish: API Manufacturing: A Road Map for Green Chemistry and Processes; pharmaQbD.com October 14, 2008
7. Malhotra, Girish; API Manufacture-Simplification and PAT; Pharmaceutical Processing, November 2005, Pages 24-27
Friday, October 1, 2010
Are The Rules A Constraint to Innovation, Competition and A Cause of Adulterated Product?
Rules are generally created to be followed. They maintain discipline. To innovate many times they are broken intentionally or unintentionally. Such forays lead to the creation of new rules. However, if the rules to be followed are cumbersome or become cumbersome, they can be a deterrent to innovation and competition. Companies need to maintain profitability while following complex rules that are difficult to comply with could ship marginally unacceptable product to the market. Such a practice would be violation of the public trust.
A review of the proposed US FDA guidelines for “Process Validation: General Principles and Practices” suggest that the rules are complex. They instead of simplifying manufacturing operations will add complexity to the business operations. At times I wonder has anyone done a dry run and economic value analysis of the proposed or even of the adopted rules on any commercial process. The proposed rules will drive manufacturing by “regulatory centricity” rather than “product centricity”. “Process and product centricity” are needed rather than “regulatory centricity”. It will take an army of technocrats time to prepare, fill and comply with the regulatory paper work. My estimate is that it will be more than the time needed to simplify and/or develop complying processes.
It seems that the regulations are being used to produce a reproducible quality product using a less than efficient process rather than having an efficient and a process from the onset that will produce repeatable quality product. Simply said the rules dictate how and what of every step of the potato peeling process needs to be documented rather than assist in creating a simple, safe and sustainable process that will result in a repeatable quality product.
“Section III. Statutory and Regulatory Requirements For Process Validation” of the proposed “Process Validation: General Principles and Practices” rules got my attention. It states the following:
“Process validation for drugs (finished pharmaceuticals and components) is a legally enforceable requirement under section 501(a)(2)(B) of the Act, which states the following:
A drug . . . shall be deemed to be adulterated . . . if . . . the methods used in, or the facilities or controls used for, its manufacture, processing, packing, or holding do not conform to or are not operated or administered in conformity with current good manufacturing practice to assure that such drug meets the requirements of this Act as to safety and has the identity and strength, and meets the quality and purity characteristics, which it purports or is represented to possess.”
If the Federal Food, Drug, and Cosmetic Act gives the US federal government legal enforceability option then why is the government not enforcing its legal obligation for its citizens when it comes to drugs that do not comply with specifications or are contaminated with foreign substances.
Marketing and formulation companies through their alliance market a product that meets specification and has to be produced following the rules. In the recent years we have seen increasing amounts of unacceptable product in the market. It could be due to increased amounts being outsourced and the companies are not able to or want to follow the complicated rules. If the product that does not meet the specifications shows up in the public domain it is violation of the company’s committed public obligation and trust. A question needs to be asked, “Why are the companies failing in their public commitment?”
Governments have allowed recalls of bad product hiccups. If a commercialized material does not meet agreed specifications, could the distribution of “off-spec” products be considered criminal offence by the pharmaceutical companies as they have failed to adhere to the established standards? Could the complexity of rules that outline how, what and why of manufacturing allows some of the product slipping through the quality checks in place? Could the rules act as a deterrent to competition and also prevent innovation in pharmaceutical manufacturing processes?
Our objective should be to simplify the rules and the processes that will foster innovation and competition through manufacturing simplicity and produce a consistent quality product all the time.
Girish Malhotra, PE
President
EPCOT International
A review of the proposed US FDA guidelines for “Process Validation: General Principles and Practices” suggest that the rules are complex. They instead of simplifying manufacturing operations will add complexity to the business operations. At times I wonder has anyone done a dry run and economic value analysis of the proposed or even of the adopted rules on any commercial process. The proposed rules will drive manufacturing by “regulatory centricity” rather than “product centricity”. “Process and product centricity” are needed rather than “regulatory centricity”. It will take an army of technocrats time to prepare, fill and comply with the regulatory paper work. My estimate is that it will be more than the time needed to simplify and/or develop complying processes.
It seems that the regulations are being used to produce a reproducible quality product using a less than efficient process rather than having an efficient and a process from the onset that will produce repeatable quality product. Simply said the rules dictate how and what of every step of the potato peeling process needs to be documented rather than assist in creating a simple, safe and sustainable process that will result in a repeatable quality product.
“Section III. Statutory and Regulatory Requirements For Process Validation” of the proposed “Process Validation: General Principles and Practices” rules got my attention. It states the following:
“Process validation for drugs (finished pharmaceuticals and components) is a legally enforceable requirement under section 501(a)(2)(B) of the Act, which states the following:
A drug . . . shall be deemed to be adulterated . . . if . . . the methods used in, or the facilities or controls used for, its manufacture, processing, packing, or holding do not conform to or are not operated or administered in conformity with current good manufacturing practice to assure that such drug meets the requirements of this Act as to safety and has the identity and strength, and meets the quality and purity characteristics, which it purports or is represented to possess.”
If the Federal Food, Drug, and Cosmetic Act gives the US federal government legal enforceability option then why is the government not enforcing its legal obligation for its citizens when it comes to drugs that do not comply with specifications or are contaminated with foreign substances.
Marketing and formulation companies through their alliance market a product that meets specification and has to be produced following the rules. In the recent years we have seen increasing amounts of unacceptable product in the market. It could be due to increased amounts being outsourced and the companies are not able to or want to follow the complicated rules. If the product that does not meet the specifications shows up in the public domain it is violation of the company’s committed public obligation and trust. A question needs to be asked, “Why are the companies failing in their public commitment?”
Governments have allowed recalls of bad product hiccups. If a commercialized material does not meet agreed specifications, could the distribution of “off-spec” products be considered criminal offence by the pharmaceutical companies as they have failed to adhere to the established standards? Could the complexity of rules that outline how, what and why of manufacturing allows some of the product slipping through the quality checks in place? Could the rules act as a deterrent to competition and also prevent innovation in pharmaceutical manufacturing processes?
Our objective should be to simplify the rules and the processes that will foster innovation and competition through manufacturing simplicity and produce a consistent quality product all the time.
Girish Malhotra, PE
President
EPCOT International
Monday, August 30, 2010
The Importance of Fundamentals
Globally Johnson & Johnson is known for its integrity and product quality. Few years ago they handled the Tylenol situation extremely well and were commended for it.
It is astounding that Year 2010 has become a nightmare for Johnson & Johnson. It is heart breaking to read a statement “Certain over-the-counter (OTC) Children’s and Infants’ liquid products manufactured in the United States have been recalled as they may contain a higher concentration of active ingredient than is specified; others may contain inactive ingredients that may not meet internal testing requirements; and others may contain tiny particles.”
Overage of active ingredient and inclusion of tiny particles is simply failure of the people to do what they are supposed to do at any manufacturing operation. In any manufacturing operation people design, operate and maintain equipment to ensure that the process operates as designed. It is a good manufacturing practice to calibrate the equipment routinely to ensure that the equipment is operating as designed. Filters get replaced on a routine basis. In addition, a mass balance is made by every chemical blending operation to make sure the process is being operated at standard or better. Mass balance and cost calculations if done you on a daily, weekly or as chosen basis tell you if your costs and material usage are on track.
Any overuse of materials will show up as the material cost being higher than standard cost and will also show up as inventory shrinkage. Higher than standard cost will be a financial variance i.e. the operation is loosing money on the product. Inventory shrinkage also shows up as a financial variance. In the case of Johnson & Johnson or any manufacturing company the two safety nets, that are supposed to catch overuse, failed. In layman terms, they lost money i.e. someone was sleeping at the financial desk.
Overuse of active ingredient and contamination of particles in the product suggests that on the operations side the manufacturing, maintenance and quality control functions also failed.
What happened at Johnson & Johnson is a gross malfunction at a Global Fortune 125 company. It seems that many at J&J forgot to apply FINANCIAL AND ENGINEERING fundamentals. Based on what I have read, it seems profits took precedence over quality. Their “Quality Czar” will have his hands dirty as he cleans the house.
Girish Malhotra, PE
President
EPCOT International
It is astounding that Year 2010 has become a nightmare for Johnson & Johnson. It is heart breaking to read a statement “Certain over-the-counter (OTC) Children’s and Infants’ liquid products manufactured in the United States have been recalled as they may contain a higher concentration of active ingredient than is specified; others may contain inactive ingredients that may not meet internal testing requirements; and others may contain tiny particles.”
Overage of active ingredient and inclusion of tiny particles is simply failure of the people to do what they are supposed to do at any manufacturing operation. In any manufacturing operation people design, operate and maintain equipment to ensure that the process operates as designed. It is a good manufacturing practice to calibrate the equipment routinely to ensure that the equipment is operating as designed. Filters get replaced on a routine basis. In addition, a mass balance is made by every chemical blending operation to make sure the process is being operated at standard or better. Mass balance and cost calculations if done you on a daily, weekly or as chosen basis tell you if your costs and material usage are on track.
Any overuse of materials will show up as the material cost being higher than standard cost and will also show up as inventory shrinkage. Higher than standard cost will be a financial variance i.e. the operation is loosing money on the product. Inventory shrinkage also shows up as a financial variance. In the case of Johnson & Johnson or any manufacturing company the two safety nets, that are supposed to catch overuse, failed. In layman terms, they lost money i.e. someone was sleeping at the financial desk.
Overuse of active ingredient and contamination of particles in the product suggests that on the operations side the manufacturing, maintenance and quality control functions also failed.
What happened at Johnson & Johnson is a gross malfunction at a Global Fortune 125 company. It seems that many at J&J forgot to apply FINANCIAL AND ENGINEERING fundamentals. Based on what I have read, it seems profits took precedence over quality. Their “Quality Czar” will have his hands dirty as he cleans the house.
Girish Malhotra, PE
President
EPCOT International
Tuesday, August 17, 2010
Square Plug In A Round Hole: Does This Scenario Exist in Pharmaceuticals?
“Square plug in a round hole” is a statement about situations that do not fit in normal life but under the right circumstances we can live with them. If this happens in a manufacturing operation, common wisdom is that money is lost on such a product/process and it would not be commercialized. However, if it happens in an operation where the money can be recovered by passing the inefficiency costs to the customers, would any one worry? Probably not! It would be worth exploring if such a scenario prevails in the manufacture of pharmaceuticals.
Chemists/Chemical Engineers develop an optimum (quality by design) process for an active pharmaceutical ingredient. During the scale up and commercialization process they find that they do not have the right size equipment and/or the configuration that exacts their desired process. However, there is a high demand for the product. Considerable monies can be earned if we produce and market this product quickly without large investment. We can alter the process or modify the existing equipment at a minimum cost to fit the process in the available equipment. The product is being produced in equipment that is not a perfect fit. It requires continuous quality analysis and equipment cleaning to minimize contamination. Would such a process be an example of “square plug in a round hole”? Further analysis might be helpful.
Based on an optimum heat and mass balance for an active pharmaceutical ingredient (API), we need equipment of size and configuration “X” to produce the product at the lowest cost. Many manufacturing sites do not have the exact size and configuration available. However, we have equipment of size and configuration “Y” and our process could be modified to fit in it. With necessary modifications product of the desired quality can be produced. The costs would be higher than the costs of an optimized process. Product produced by such processes would require repeated analysis of the intermediates and the final product to ensure our process and equipment would deliver the desired quality product. Necessary manufacturing protocol would have to be strictly followed and enforced. Equipment would have to be thoroughly cleaned between batches. All of the associated manufacturing costs will be passed on to the customer. Due to high demand the product could be produced at different sites. The process or the equipment would have to be modified to fit the local situations.
Since we have force fitted a process in equipment that is not specifically designed for it, I would call such a process “square plug in a round hole” that has opportunities to lower costs but since the company is able to meet or exceed their profit margins lowest cost optimized process considerations and process innovation become irrelevant. Under these circumstances we also overlook “square plug in a round hole” connotation.
In the above scenario “quality by analysis” becomes a way of life. Pharmaceuticals are living in such an environment. Since the companies are able to demonstrate product quality repeatability, meet regulatory guidelines and achieve their profit margins having an optimum process or practicing the best manufacturing technology is not necessary. What do you think?
Girish Malhotra, PE
President
EPCOT International
Chemists/Chemical Engineers develop an optimum (quality by design) process for an active pharmaceutical ingredient. During the scale up and commercialization process they find that they do not have the right size equipment and/or the configuration that exacts their desired process. However, there is a high demand for the product. Considerable monies can be earned if we produce and market this product quickly without large investment. We can alter the process or modify the existing equipment at a minimum cost to fit the process in the available equipment. The product is being produced in equipment that is not a perfect fit. It requires continuous quality analysis and equipment cleaning to minimize contamination. Would such a process be an example of “square plug in a round hole”? Further analysis might be helpful.
Based on an optimum heat and mass balance for an active pharmaceutical ingredient (API), we need equipment of size and configuration “X” to produce the product at the lowest cost. Many manufacturing sites do not have the exact size and configuration available. However, we have equipment of size and configuration “Y” and our process could be modified to fit in it. With necessary modifications product of the desired quality can be produced. The costs would be higher than the costs of an optimized process. Product produced by such processes would require repeated analysis of the intermediates and the final product to ensure our process and equipment would deliver the desired quality product. Necessary manufacturing protocol would have to be strictly followed and enforced. Equipment would have to be thoroughly cleaned between batches. All of the associated manufacturing costs will be passed on to the customer. Due to high demand the product could be produced at different sites. The process or the equipment would have to be modified to fit the local situations.
Since we have force fitted a process in equipment that is not specifically designed for it, I would call such a process “square plug in a round hole” that has opportunities to lower costs but since the company is able to meet or exceed their profit margins lowest cost optimized process considerations and process innovation become irrelevant. Under these circumstances we also overlook “square plug in a round hole” connotation.
In the above scenario “quality by analysis” becomes a way of life. Pharmaceuticals are living in such an environment. Since the companies are able to demonstrate product quality repeatability, meet regulatory guidelines and achieve their profit margins having an optimum process or practicing the best manufacturing technology is not necessary. What do you think?
Girish Malhotra, PE
President
EPCOT International
Wednesday, July 21, 2010
Pharmaceutical Reverse Payments and Lower Drug Costs: An Interesting Dilemma!
US Federal Trade Commission and the lawmakers have scorned “reverse payment” also called “pay-for delay” in the pharmaceutical business. US House of Representative recently voted 239-182 to restrict such payments in the hopes that stopping such payments will reduce the cost of drugs to the consumer. Legislators would like to see the drug costs lowered for their constituents. Everyone had expected that the entry of generics would significantly reduce the drug prices. Generics have put some pressure on brand companies but their presence has not lowered the costs of drugs by significant percentage.
US Federal Trade Commission estimates that the “reverse payments” could save US customers about $ 3.5 billion dollars per year. These savings might be there but they are not worth the effort and squabble compared to the yearly US drug revenue of about $480 billion dollars. These payments are less than three day’s revenue. Since every company wants to maximize their profits for the patented drugs, use of “reverse payment” is part of doing business. These costs are passed on to the consumer. In US customers, who are covered by a health plan do not know the real prices of the prescription drugs they just pay the co-pay.
Legislation is not going to lower the drug costs. Fundamental reason for the companies to be in the business is “profits”. If any government limits the profit margins or sets the prices, they that will be in direct conflict with the charter of every company i.e. to have the highest profits. Government’s price control would discourage innovation.
We need to understand the factors of prices/costs, how they can be lowered and passed on to the consumers. Underlying fact is that all of us want to extend our life and we will pay anything for that. Drug prices are based on this sentiment. Prices are set at the highest level companies believe customers can afford. Every company in the supply chain has used this sentiment for pricing. This also covers inefficiencies of the companies.
Limiting profits is against the economic principles. Laws of economics teach us that in a fair game, only competition can lower prices. Brand companies have lowered prices when they want to promote and/or grab the market share as evidenced by recent price drops in the selected developing countries. In the recent years limited number of prescription drugs are available from well-known merchandisers [$4.00 for 30 day and $10.00 for 90 day supply]. This is a clear indication that the drug prices can be lowered and everyone in the supply chain can make their desired profit.
Regulatory and appropriate government bodies have to facilitate competition. Companies in the supply chain also have to participate in this endeavor. Lowering of drug costs to the consumer by 8-10 percent or higher will have value for consumers provided they are passed on. Less than one percent cost reduction is of no value. Addressing minor issues like “reverse payment” just placates the constituents without accomplishing anything and upsets the brand pharmaceutical companies.
Real issues that will lower the drug costs need to be addressed and no one is addressing them.
Girish MALHOTRA, PE
US Federal Trade Commission estimates that the “reverse payments” could save US customers about $ 3.5 billion dollars per year. These savings might be there but they are not worth the effort and squabble compared to the yearly US drug revenue of about $480 billion dollars. These payments are less than three day’s revenue. Since every company wants to maximize their profits for the patented drugs, use of “reverse payment” is part of doing business. These costs are passed on to the consumer. In US customers, who are covered by a health plan do not know the real prices of the prescription drugs they just pay the co-pay.
Legislation is not going to lower the drug costs. Fundamental reason for the companies to be in the business is “profits”. If any government limits the profit margins or sets the prices, they that will be in direct conflict with the charter of every company i.e. to have the highest profits. Government’s price control would discourage innovation.
We need to understand the factors of prices/costs, how they can be lowered and passed on to the consumers. Underlying fact is that all of us want to extend our life and we will pay anything for that. Drug prices are based on this sentiment. Prices are set at the highest level companies believe customers can afford. Every company in the supply chain has used this sentiment for pricing. This also covers inefficiencies of the companies.
Limiting profits is against the economic principles. Laws of economics teach us that in a fair game, only competition can lower prices. Brand companies have lowered prices when they want to promote and/or grab the market share as evidenced by recent price drops in the selected developing countries. In the recent years limited number of prescription drugs are available from well-known merchandisers [$4.00 for 30 day and $10.00 for 90 day supply]. This is a clear indication that the drug prices can be lowered and everyone in the supply chain can make their desired profit.
Regulatory and appropriate government bodies have to facilitate competition. Companies in the supply chain also have to participate in this endeavor. Lowering of drug costs to the consumer by 8-10 percent or higher will have value for consumers provided they are passed on. Less than one percent cost reduction is of no value. Addressing minor issues like “reverse payment” just placates the constituents without accomplishing anything and upsets the brand pharmaceutical companies.
Real issues that will lower the drug costs need to be addressed and no one is addressing them.
Girish MALHOTRA, PE
Tuesday, May 25, 2010
Microscopic Examination of Indian Pharmaceutical Acquisitions by Multinational Companies
Brand companies establishing beachhead in India is a logical choice as they see access to market to growing at 10+ percent. India is source of revenue and profit replenishment for the multinationals. End result of such acquisitions is going to higher drug prices for the masses or government intervention. It would be interesting to see what develops.
There is an underlying question about the sales of Indian pharmaceuticals companies. Why?
Since 2005 Indian companies have challenged the multinationals and have forced a landscape change. Why are the companies being sold now when they have created very successful franchises? One could say the price was too good to refuse. May be, but has anyone considered another reason i.e. lack of succession in the entrepreneur families or letting the trained managers run and grow the companies to compete with the brand companies.
Singh family (Ranbaxy) allegedly had family feud and they brought in Dr. Brian Tempest to cool the storm. However, under Singh family regime there were lapses as manifested by US FDA’s actions. Were the lapses beyond control to fix? Under these circumstances Singh family got an offer they could not refuse. Could that be the case with Piramal family?
Consolidation within India i.e. one successful company buying other pharmaceutical company is not in the culture. Thus unless there is strong succession planning, we will see repeats of Matrix Labs, Ranbaxy, Shantha Biotech and Piramal Healthcare.
If the entrepreneur families do not pass the baton to trained professionals, I believe Indian pharmaceuticals, API (active pharmaceutical ingredient) companies, formulators and other associated with the pharmaceuticals could be selling out to MNCs. It will be a case of take your money and run.
There is an underlying question about the sales of Indian pharmaceuticals companies. Why?
Since 2005 Indian companies have challenged the multinationals and have forced a landscape change. Why are the companies being sold now when they have created very successful franchises? One could say the price was too good to refuse. May be, but has anyone considered another reason i.e. lack of succession in the entrepreneur families or letting the trained managers run and grow the companies to compete with the brand companies.
Singh family (Ranbaxy) allegedly had family feud and they brought in Dr. Brian Tempest to cool the storm. However, under Singh family regime there were lapses as manifested by US FDA’s actions. Were the lapses beyond control to fix? Under these circumstances Singh family got an offer they could not refuse. Could that be the case with Piramal family?
Consolidation within India i.e. one successful company buying other pharmaceutical company is not in the culture. Thus unless there is strong succession planning, we will see repeats of Matrix Labs, Ranbaxy, Shantha Biotech and Piramal Healthcare.
If the entrepreneur families do not pass the baton to trained professionals, I believe Indian pharmaceuticals, API (active pharmaceutical ingredient) companies, formulators and other associated with the pharmaceuticals could be selling out to MNCs. It will be a case of take your money and run.
Tuesday, April 6, 2010
Process Centricity is the Key to Quality by Design
It would be worth reviewing future of pharma’s most discussed acronyms (PAT, QBA and QBD). The following are my interpretation of these acronyms.
PAT (Process Analytical Technologies) means various analytical methods that can be used to convey the state of the sample as soon it is tested.
QBA (Quality by Analysis) is a methodology where the intermediates are tested by “off-line” sampling. The results tell us an “after the fact” state of the manufacturing process. Repeated testing is used to tweak the process till the desired quality product is produced. Such testing is manifestation of lack of complete understanding of the chemistry, process, equipment and any and all variables that interact to produce a product.
QBD (Quality by Design) tells us that the people, who have developed and designed the process, have complete understanding of the process, equipment and their interaction as the sample tested would meet specifications any and all the time. No intermediate sampling is necessary.
Around 2001, the above acronyms were coined for the Pharmaceutical world. They were an instant buzz and synonymous with the current and future state of manufacturing. However, based on reading much of the published literature, I get the impression that “PAT” is considered a cure all and by waving this magic wand, we will produce quality product all the time. This is far from reality.
Published literature also suggests many differing interpretations of these TLA’s and that could be the one of the reasons for very little progress toward QBD adoption.
Any analytical equipment, that costs more than $30,000 (just a number) and requires an analytical chemist to operate and interpret the results for a commercial operation, is expensive. As stated earlier an intermediate process sample tells the state of the sample tested i.e. is the process on track or not. This testing will not and cannot fix the manufacturing process automatically unless the analytical equipment delivers real time results and has feedback loops to control the process stoichiometry and operating conditions. In order to have this level of process sophistication one has to have complete understanding of the chemistry, process equipment and operating conditions i.e. one has to move from “chemistry centricity” to “process centricity”.
What is process centricity? Process centricity to me means moving away from “chemistry centric” laboratory practices and commercializing unit processes by applying appropriate unit operations. This would allow operating personnel to have complete command of the chemistry, process equipment and operating conditions. They can create a process error, observe the process change and can correct the error in minimal time without producing off-spec product. Chemists and chemical engineers have to have incorporated this level of knowledge in the process. This would be perfection (almost) and will not require complex analytical methods to check the process and the product, as we will produce quality. We will achieve QBD i.e. NIRVANA.
Since majority of the APIs are fine/specialty chemicals, their manufacturing practices are very similar. Due to dosage needs the API annual manufacturing production volumes are significantly different from fine/specialty chemical volumes. Thus, it is necessary that we evaluate the current manufacturing practices. Process centricity might necessitate that we change/alter API manufacturing practices. We have to implement methods that are simple and based on good chemical engineering principles and practices. Technologies and methods exist to achieve this change but due to “chemistry centricity” we have not made any significant progress.
As I have explained in a recent article and blogs companies most suited for implementing “Quality by Design” are the API producers and the formulating companies. They have to move away from “chemistry centricity” to “manufacturing centricity” during the technology transfer and incorporate methods that do not require any intermediate product sampling and analysis. This might not look or sound easy, but is the only way to produce a product based on “quality by design”.
It is a bit disheartening for many that almost after ten years, we are still discussing PAT, QBA and QBD. If more than 51 percent of the API producers and formulators stop intermediate sampling, I will consider QBD would become a way of future life in the pharmaceutical world. If this does not happen soon (let us say in the next two to three years) my conjecture is that PAT, QBA and QBD will disappear from the pharmaceutical vocabulary like any other fad. That would be sad because we collectively would have failed to implement a good idea that not only will improve profits but also might facilitate regulatory requirements.
Girish MALHOTRA, PE
President
EPCOT International
PAT (Process Analytical Technologies) means various analytical methods that can be used to convey the state of the sample as soon it is tested.
QBA (Quality by Analysis) is a methodology where the intermediates are tested by “off-line” sampling. The results tell us an “after the fact” state of the manufacturing process. Repeated testing is used to tweak the process till the desired quality product is produced. Such testing is manifestation of lack of complete understanding of the chemistry, process, equipment and any and all variables that interact to produce a product.
QBD (Quality by Design) tells us that the people, who have developed and designed the process, have complete understanding of the process, equipment and their interaction as the sample tested would meet specifications any and all the time. No intermediate sampling is necessary.
Around 2001, the above acronyms were coined for the Pharmaceutical world. They were an instant buzz and synonymous with the current and future state of manufacturing. However, based on reading much of the published literature, I get the impression that “PAT” is considered a cure all and by waving this magic wand, we will produce quality product all the time. This is far from reality.
Published literature also suggests many differing interpretations of these TLA’s and that could be the one of the reasons for very little progress toward QBD adoption.
Any analytical equipment, that costs more than $30,000 (just a number) and requires an analytical chemist to operate and interpret the results for a commercial operation, is expensive. As stated earlier an intermediate process sample tells the state of the sample tested i.e. is the process on track or not. This testing will not and cannot fix the manufacturing process automatically unless the analytical equipment delivers real time results and has feedback loops to control the process stoichiometry and operating conditions. In order to have this level of process sophistication one has to have complete understanding of the chemistry, process equipment and operating conditions i.e. one has to move from “chemistry centricity” to “process centricity”.
What is process centricity? Process centricity to me means moving away from “chemistry centric” laboratory practices and commercializing unit processes by applying appropriate unit operations. This would allow operating personnel to have complete command of the chemistry, process equipment and operating conditions. They can create a process error, observe the process change and can correct the error in minimal time without producing off-spec product. Chemists and chemical engineers have to have incorporated this level of knowledge in the process. This would be perfection (almost) and will not require complex analytical methods to check the process and the product, as we will produce quality. We will achieve QBD i.e. NIRVANA.
Since majority of the APIs are fine/specialty chemicals, their manufacturing practices are very similar. Due to dosage needs the API annual manufacturing production volumes are significantly different from fine/specialty chemical volumes. Thus, it is necessary that we evaluate the current manufacturing practices. Process centricity might necessitate that we change/alter API manufacturing practices. We have to implement methods that are simple and based on good chemical engineering principles and practices. Technologies and methods exist to achieve this change but due to “chemistry centricity” we have not made any significant progress.
As I have explained in a recent article and blogs companies most suited for implementing “Quality by Design” are the API producers and the formulating companies. They have to move away from “chemistry centricity” to “manufacturing centricity” during the technology transfer and incorporate methods that do not require any intermediate product sampling and analysis. This might not look or sound easy, but is the only way to produce a product based on “quality by design”.
It is a bit disheartening for many that almost after ten years, we are still discussing PAT, QBA and QBD. If more than 51 percent of the API producers and formulators stop intermediate sampling, I will consider QBD would become a way of future life in the pharmaceutical world. If this does not happen soon (let us say in the next two to three years) my conjecture is that PAT, QBA and QBD will disappear from the pharmaceutical vocabulary like any other fad. That would be sad because we collectively would have failed to implement a good idea that not only will improve profits but also might facilitate regulatory requirements.
Girish MALHOTRA, PE
President
EPCOT International
Tuesday, March 16, 2010
Alternate Interpretation of Pharmaceutical TLAs; Three-letter Acronyms
Around 2001 Dr. Ajaz Hussain and his colleagues at USFDA-based on their experiences-suggested and encouraged the global pharmaceutical industry to improve their process technologies so that the manufacturing practices could be simplified and quality products produced with minimum interference. It has been a noble effort and led to the coining of two acronyms QBA and QBD. Based on the amount of printed material, I have seen considerable analysis and discussion on how to move from “A” to “D”. I would like to restate these acronyms differently in a lighter perspective with the hope that we will improve our manufacturing technologies.
In the current state of manufacture of active pharmaceutical ingredients (APIs) and formulated products, we repeatedly check intermediates and the final product for quality. This practice has been appropriately called “Quality by Analysis” (QBA). It not only prolongs the manufacturing cycles and processes but also impacts the whole business process through increased inventories of raw materials, in-process materials and finished goods. The whole business process becomes complex and lowers profitability.
I would like to rename the acronym QBA and call it “Quality by Aggravation”. Why aggravation? Meticulous sampling and analysis is necessary to ensure we follow protocol at each step. This prolongs and extends the batch cycle times. Everyone gets aggravated if anything is not done as per procedures. Intermediate product not meeting specifications either is reworked or disposed of. All this costs money. In addition, it increases work in process inventories that affects the cash flow. Additional investment could be needed to quarantine intermediates and all this lower profits. In doing all these we aggravate our life and it has been our way of life.
Aggravation (mental and financial) in pharmaceutical manufacturing processes can be alleviated if we have complete command of the process chemistry and its unit operations so that we can produce quality product with minimum or no intermediate samplings. Since we will produce products based on “quality by design” QBD, I would also like to rename this acronym to “Quality by Desire”. We will have quality production. This will simplify manufacturing process and life. Our desire to have an excellent process could significantly reduce our aggravation. It even could be eliminated.
Pharmaceutical products have to meet the strictest of the quality standards no matter how the products are produced. The question that needs to be put on the table is what should be our method of choosing to produce a quality product. “Quality by Aggravation” or “Quality by Desire” are the two choices and we have to pick one.
Most of us know the correct answer. All of us have a choice and can do what we desire. Since maximizing profitability is the ultimate goal, I am not sure why we have avoided the right path for so long. Is the industry waiting for disruptive innovation?
QBA and QBD methods are applicable to everything we do in life. When we desire anything, we make sure that our methods to achieve the goals are swift and simple. We always pick QBD. Our choice in the manufacture of pharmaceuticals and their components is “Quality by Aggravation” or “Quality by Desire”. You pick.
Girish Malhotra, PE
President
EPCOT International
In the current state of manufacture of active pharmaceutical ingredients (APIs) and formulated products, we repeatedly check intermediates and the final product for quality. This practice has been appropriately called “Quality by Analysis” (QBA). It not only prolongs the manufacturing cycles and processes but also impacts the whole business process through increased inventories of raw materials, in-process materials and finished goods. The whole business process becomes complex and lowers profitability.
I would like to rename the acronym QBA and call it “Quality by Aggravation”. Why aggravation? Meticulous sampling and analysis is necessary to ensure we follow protocol at each step. This prolongs and extends the batch cycle times. Everyone gets aggravated if anything is not done as per procedures. Intermediate product not meeting specifications either is reworked or disposed of. All this costs money. In addition, it increases work in process inventories that affects the cash flow. Additional investment could be needed to quarantine intermediates and all this lower profits. In doing all these we aggravate our life and it has been our way of life.
Aggravation (mental and financial) in pharmaceutical manufacturing processes can be alleviated if we have complete command of the process chemistry and its unit operations so that we can produce quality product with minimum or no intermediate samplings. Since we will produce products based on “quality by design” QBD, I would also like to rename this acronym to “Quality by Desire”. We will have quality production. This will simplify manufacturing process and life. Our desire to have an excellent process could significantly reduce our aggravation. It even could be eliminated.
Pharmaceutical products have to meet the strictest of the quality standards no matter how the products are produced. The question that needs to be put on the table is what should be our method of choosing to produce a quality product. “Quality by Aggravation” or “Quality by Desire” are the two choices and we have to pick one.
Most of us know the correct answer. All of us have a choice and can do what we desire. Since maximizing profitability is the ultimate goal, I am not sure why we have avoided the right path for so long. Is the industry waiting for disruptive innovation?
QBA and QBD methods are applicable to everything we do in life. When we desire anything, we make sure that our methods to achieve the goals are swift and simple. We always pick QBD. Our choice in the manufacture of pharmaceuticals and their components is “Quality by Aggravation” or “Quality by Desire”. You pick.
Girish Malhotra, PE
President
EPCOT International
Tuesday, February 2, 2010
HIV Drug Availability and Potential Manufacturing Opportunity
Global spread of HIV/AIDS has been and is a cause of alarm. Approximately 33.4 million people are estimated to be infected with HIV/AIDS and about 30% of this population can use the antiretroviral therapy (ART). Of this number about 42% are getting the treatment. This could be due to pricing and/or their availability or a combination of both. There are methods and means to lower the cost and increase availability. I have used AZT (Azidothymidine/Zidovudine) an ART component as an example to illustrate the need for manufacturing technology innovation that can lower prices and increase availability.
In general majority of the active pharmaceutical ingredients (API) are manufactured using batch processes. This is more due to tradition rather than the process chemistry and economics. This holds true for high and low volume actives. Some of the actives due to their chemistry and volume have become commodity chemicals and are produced by continuous processes. However, batch processing is still the preferred method of API manufacture in China and India irrespective of their volume.
Under Clinton Foundation HIV/AIDS Initiative (CHAI), prices of some of the HIV/AIDS drugs have been negotiated with the suppliers from India and China. AZT (300 milligram) tablet is priced at 13.3 cents.
Doing a reverse calculation and using about 80% tablet formulation yield, one can calculate potential bulk selling price of the azidothymidine. Using two 300-milligram tablets per day about 2.4 million pounds of azidothymidine would be needed for about 4 million patients. At $25.00 per kilo, the cost of the API content would be about 1.88 cents per tablet. If the formulation, excipient cost and profit were considered to be 5 times the cost of API (an estimate), the cost of finished tablet would be about 11.25 cents per tablet compared to 13.3 cents from CHAI. Thus the assumption of $25.00 per kilo for bulk API is not un-reasonable. All of the AZT in the above consideration is produced using batch processes.
In the coming years under the new World health Organization guidelines, if the number of people needing treatment grows to 14 Million, there would be a supply problem. The capacity of the existing batch processes would have to be increased to about 8.5 million pounds of AZT per year. Similar steps would be needed to increase capacity of other members of the ART cocktail. Other alternate is to develop and commercialize continuous processes.
A continuous process would not only increase throughput but also will lower the manufacturing cost and consistently produce product of high quality. Combination of improved manufacturing technology and throughput can easily lower costs by 20-25%. Based on the reported chemistry, it should be feasible to develop a continuous process. We should never forget that most of the actives are fine chemicals first and drugs second. Acceptance of this fact might facilitate development of better manufacturing technologies. If better technology drops the price of AZT from 11.25 cents per tablet to 9 cents this would be a significant improvement.
A continuous process would have much higher throughput than the batch processes facilitating availability of the needed drug. Plants can be ramped up and down to meet the market demand. Three plants using continuous processes and operating at about 400 pounds per hour (24/350 at 85% on-stream-time) could meet the global demand of AZT and give the operators higher profit margin. Strategy discussed above could be extended for other components of the HIV/AIDS cocktail. It would be a win-win.
In general majority of the active pharmaceutical ingredients (API) are manufactured using batch processes. This is more due to tradition rather than the process chemistry and economics. This holds true for high and low volume actives. Some of the actives due to their chemistry and volume have become commodity chemicals and are produced by continuous processes. However, batch processing is still the preferred method of API manufacture in China and India irrespective of their volume.
Under Clinton Foundation HIV/AIDS Initiative (CHAI), prices of some of the HIV/AIDS drugs have been negotiated with the suppliers from India and China. AZT (300 milligram) tablet is priced at 13.3 cents.
Doing a reverse calculation and using about 80% tablet formulation yield, one can calculate potential bulk selling price of the azidothymidine. Using two 300-milligram tablets per day about 2.4 million pounds of azidothymidine would be needed for about 4 million patients. At $25.00 per kilo, the cost of the API content would be about 1.88 cents per tablet. If the formulation, excipient cost and profit were considered to be 5 times the cost of API (an estimate), the cost of finished tablet would be about 11.25 cents per tablet compared to 13.3 cents from CHAI. Thus the assumption of $25.00 per kilo for bulk API is not un-reasonable. All of the AZT in the above consideration is produced using batch processes.
In the coming years under the new World health Organization guidelines, if the number of people needing treatment grows to 14 Million, there would be a supply problem. The capacity of the existing batch processes would have to be increased to about 8.5 million pounds of AZT per year. Similar steps would be needed to increase capacity of other members of the ART cocktail. Other alternate is to develop and commercialize continuous processes.
A continuous process would not only increase throughput but also will lower the manufacturing cost and consistently produce product of high quality. Combination of improved manufacturing technology and throughput can easily lower costs by 20-25%. Based on the reported chemistry, it should be feasible to develop a continuous process. We should never forget that most of the actives are fine chemicals first and drugs second. Acceptance of this fact might facilitate development of better manufacturing technologies. If better technology drops the price of AZT from 11.25 cents per tablet to 9 cents this would be a significant improvement.
A continuous process would have much higher throughput than the batch processes facilitating availability of the needed drug. Plants can be ramped up and down to meet the market demand. Three plants using continuous processes and operating at about 400 pounds per hour (24/350 at 85% on-stream-time) could meet the global demand of AZT and give the operators higher profit margin. Strategy discussed above could be extended for other components of the HIV/AIDS cocktail. It would be a win-win.
Wednesday, January 20, 2010
A Radical Approach to Fine/Specialty API Manufacturing
Average wholesale price (AWP) of blockbuster drugs (sales greater than one billion dollar/year) and dosage determine the quantity of API needed. This calculation can be made easily based on information in the public domain. For a 200 milligram dose blockbuster, a decent process for a certain molecule at $10.00 AWP, would require about 25,000 kilos of API. API need would change with different AWP and dosage. Poor process and yield would mean that their pollution (not just carbon) footprint is much bigger. At $50 per kilo, the API revenue would be about $1.25 million dollars, which is miniscule compared to the total drug revenue.
Due to low volumes, the global API producers resort to the easy, traditional method that we are taught through our textbooks - batch process. The nature of the batch process diminishes/prevents any implementation of “Quality by design (QBD)” methods and we resort to “after the fact” analysis and fixes, which cost both money and time. This situation is the norm for in pharmaceutical fine chemical manufacturing.
Due to the price differential between AWP, the factory cost of API and the tablet/capsule, there is little financial incentive for the drug wholesaler to invest in manufacturing innovation. However, the API producer and the drug formulator have a major incentive to improve their profits – being the manufacturing technology innovation leader. However, a production paradigm shift on the part of producers and formulators is needed to achieve that goal.
Creative incorporation of physical properties and unit processes, as well as manipulation of unit operations and modular plants can facilitate QBD. This will serve to ensure continuous processes producing quality product the first time and all the time. Modular plants can produce almost any combination of fine or specialty chemicals. Since the API volumes are low, they can be campaigned allowing different products to be produced by companies with proficiency or expertise in specific chemistries and/or methods. Entities with knowledge of alternative manufacturing methods can easily produce some of the actives using continuous processes. A properly designed facility can produce about 55,000 pounds of product operating 24/7 at 100 pounds per hour in about four weeks. A batch process can take longer and would require greater investment.
Fine/specialty chemicals such as 3-(diaminomethylidene)-1,1-dimethylguanidine hydrochloride, 2-[1-(aminomethyl)cyclohexyl]acetic acid, (RS)-6-methoxy-2-((4-methoxy-3,5-dimethylpyridin-2-yl) methylsulfinyl)-1H-benzo[d]imidazole, various Fluoroquinolones derivatives, 2-[di(phenyl)methylsulfinyl]acetamide, 1-[(2R,4S,5S)-4-azido-5-(hydroxymethyl)oxolan-2-yl]-5-methyl-1,2,3,4-tetrahydropyrimidine-2,4-dione are a few examples of what can be produced by batch processes. However, continuous processes using modular unit operations can also produce these products. One must be creative and able to effectively incorporate the nuances of physical properties and reaction kinetics into the manufacturing processes. The above chemicals are examples of anti diabetic, anti bacterial, pump protein inhibitor, anti viral compound and other disease curing actives.
Traditionally, in the development of pharmaceutical fine/specialty chemicals we get enamored with incorporating regulatory practices and guidelines before we have an excellent process that will produce repeatable and consistent quality product without “in-process” analysis of intermediates. This is like trying to fit a square peg into a round hole. For manufacturing technology innovation, we have to step out of our comfort zone. The North American automobile industry, for example, got trapped in its comfort zone with very discomforting results. Chinese/Indian or any other companies could be the “creative destructionist” and change the global playing field.
Alternative manufacturing technologies and methods will force process efficiencies and lower the pollution footprint. API manufacturers and drug formulators must take the lead in utilizing these methods. Since such methods would be innovative, we could also see reduction or stoppage of job migration to developing countries. With the right technologies cGMP would be a given.
Girish Malhotra, PE
EPCOT International
Thursday, December 10, 2009
What is Jugaad (new management fad from India)?
In the recent years we all have been reading and hearing about what the Indians have been doing in the areas of IT, chemicals, pharmaceuticals and petrochemicals etc. They have accomplished all through desire, creativity and Jugaad.
Recent issue of Business Week covers “India's Next Global Export: Innovation” called Jugaad. So, what does this new management fad mean? In the simplistic terms, Jugaad literally means an arrangement or a work around, which have to be used because of lack of resources.
This definition is very apropos. All of us have exercised Jugaad in our lives and may not have realized it. It could be developing a better process or a product. It could be stealing a base in baseball, kicking a soccer ball to score a goal or the topspin of the tennis racket to win the match i.e. achieving an objective using whatever it takes. All of us have the creativity to achieve our goals and objectives. We have what it takes.
Many of us might not have heard of Mr. Michael O’Leary. He is the chief executive of Ryanair Holdings Co., the Irish no-frills airline. He is putting his Jugaad to practice. His creativity is evident when he started a one-car taxi company to legally use Dublin’s bus lanes and cut an hour from his daily commute. This is Jugaad. Jugaad is not an Indian thing. It is everywhere. All of us have it. We just need to do things in a manner that simplify things and processes.
Can we apply Jugaad to the manufacture of chemicals, pharmaceuticals, polymers, resins and other chemical based products? Yes, we absolutely can. By learning the fundamentals of chemistry, physics, mathematics we have the knowledge base. Along with these fundamentals if we just apply our creativity and imagination we will have the simplest and cost effective processes producing highest quality products. Customer will come back time after time and we will generate sufficient and significant profits.
Girish Malhotra, PE
President
EPCOT International
Recent issue of Business Week covers “India's Next Global Export: Innovation” called Jugaad. So, what does this new management fad mean? In the simplistic terms, Jugaad literally means an arrangement or a work around, which have to be used because of lack of resources.
This definition is very apropos. All of us have exercised Jugaad in our lives and may not have realized it. It could be developing a better process or a product. It could be stealing a base in baseball, kicking a soccer ball to score a goal or the topspin of the tennis racket to win the match i.e. achieving an objective using whatever it takes. All of us have the creativity to achieve our goals and objectives. We have what it takes.
Many of us might not have heard of Mr. Michael O’Leary. He is the chief executive of Ryanair Holdings Co., the Irish no-frills airline. He is putting his Jugaad to practice. His creativity is evident when he started a one-car taxi company to legally use Dublin’s bus lanes and cut an hour from his daily commute. This is Jugaad. Jugaad is not an Indian thing. It is everywhere. All of us have it. We just need to do things in a manner that simplify things and processes.
Can we apply Jugaad to the manufacture of chemicals, pharmaceuticals, polymers, resins and other chemical based products? Yes, we absolutely can. By learning the fundamentals of chemistry, physics, mathematics we have the knowledge base. Along with these fundamentals if we just apply our creativity and imagination we will have the simplest and cost effective processes producing highest quality products. Customer will come back time after time and we will generate sufficient and significant profits.
Girish Malhotra, PE
President
EPCOT International
Thursday, October 8, 2009
An Interpretation of U.S. FDA Guidance for Pharma Manufacture
About five years ago FDA issued its “PAT Guidance for Industry” (September 2004). FDA’s intent by issuing the guidelines is to encourage the Pharmaceutical Industry to improve and innovate its manufacturing practices so that they produce quality product the first time and all the time. Manufacturing innovation will be the lifeline for the Pharmaceuticals as their business model changes.
Regulatory bodies want the companies to move away from achieving quality through the current practice of “after the fact repeated analysis”. Achieving product quality “the first time” and all the time is the goal. This is not a difficult expectation.
The guideline is suggesting the industry of how and what needs to be done and the methodology for improving the processes. However, innovation has to come from within the industry rather than thrust upon them. The guidance is very legalese and can be interpreted in many different ways. As written it eludes more to drug formulation than to Active Pharmaceutical Ingredient (API) manufacture. However, the rules of the game for API and drug formulation are same as quality is the ultimate goal.
If we clear the forest and the legal jargon, FDA is saying “understand how the chemicals react, interact and behave with each other and have a process that if operated at the desired process conditions should deliver quality product the “first time” and all the time [basic tenants of chemical engineering, chemistry curriculum and process development]”. Anything short will not deliver first time quality product.
In product and process development, we need to understand the chemicals, their interaction, establish specifications and use different analytical technologies to ensure that the developed process will deliver the expected product. If one is expecting that the process analytical technologies will fix a bad process, then that would be a gross error and expectation. Analytical technologies tell us the result rather than the path to the result.
Good manufacturing practices and continuous improvement is a must for every manufacturing. PAT guidance suggests that the pharmaceutical industry should have discussion and approval from FDA on their existing process improvement plans. This is adding costs. The benefits of process improvement can be quantified but since the re-approval costs are not known, my conjecture is that the industry would not opt for any process improvement for their existing products as the costs could exceed the benefits. Estimated savings due to process innovations for the pharmaceutical companies are in the $100 to $200 billion dollars range. I hope this is good incentive to innovate.
Pharmaceuticals companies due to first to market pressures and following regulatory directives and guidelines are not able to apply good chemistry and engineering principles to have an efficient process that produces quality product. The current state of pharmaceutical manufacture is manifestation of our methods. If we are expecting it to change pharmaceutical companies have to take the lead. Innovation can happen for the products that will become generic in the coming years and for the new molecules that will be commercialized.
Development of innovative processes has to start during the process conceptualization and development. Even then it would have to be an effort as old methods and thinking would have to be discarded, which is not easy. The regulatory bodies will have to be flexible and encourage innovation. PAT guidelines and other guidelines are encouraging innovation but have too many constraints. I strongly believe that innovation can reduce regulation.
Girish Malhotra, PE
President
EPCOT International
Regulatory bodies want the companies to move away from achieving quality through the current practice of “after the fact repeated analysis”. Achieving product quality “the first time” and all the time is the goal. This is not a difficult expectation.
The guideline is suggesting the industry of how and what needs to be done and the methodology for improving the processes. However, innovation has to come from within the industry rather than thrust upon them. The guidance is very legalese and can be interpreted in many different ways. As written it eludes more to drug formulation than to Active Pharmaceutical Ingredient (API) manufacture. However, the rules of the game for API and drug formulation are same as quality is the ultimate goal.
If we clear the forest and the legal jargon, FDA is saying “understand how the chemicals react, interact and behave with each other and have a process that if operated at the desired process conditions should deliver quality product the “first time” and all the time [basic tenants of chemical engineering, chemistry curriculum and process development]”. Anything short will not deliver first time quality product.
In product and process development, we need to understand the chemicals, their interaction, establish specifications and use different analytical technologies to ensure that the developed process will deliver the expected product. If one is expecting that the process analytical technologies will fix a bad process, then that would be a gross error and expectation. Analytical technologies tell us the result rather than the path to the result.
Good manufacturing practices and continuous improvement is a must for every manufacturing. PAT guidance suggests that the pharmaceutical industry should have discussion and approval from FDA on their existing process improvement plans. This is adding costs. The benefits of process improvement can be quantified but since the re-approval costs are not known, my conjecture is that the industry would not opt for any process improvement for their existing products as the costs could exceed the benefits. Estimated savings due to process innovations for the pharmaceutical companies are in the $100 to $200 billion dollars range. I hope this is good incentive to innovate.
Pharmaceuticals companies due to first to market pressures and following regulatory directives and guidelines are not able to apply good chemistry and engineering principles to have an efficient process that produces quality product. The current state of pharmaceutical manufacture is manifestation of our methods. If we are expecting it to change pharmaceutical companies have to take the lead. Innovation can happen for the products that will become generic in the coming years and for the new molecules that will be commercialized.
Development of innovative processes has to start during the process conceptualization and development. Even then it would have to be an effort as old methods and thinking would have to be discarded, which is not easy. The regulatory bodies will have to be flexible and encourage innovation. PAT guidelines and other guidelines are encouraging innovation but have too many constraints. I strongly believe that innovation can reduce regulation.
Girish Malhotra, PE
President
EPCOT International
Friday, September 25, 2009
Fine Chemicals: Quality Manufacturing and Technology Innovation in Pharmaceuticals
A recent survey “Pharmaceutical Process Control: Is the Great Divide Growing?” makes one think and ponder about the direction of manufacturing technologies and process development methods in the changing pharmaceutical business model.
I found some of the answers to be conflicting. The problems of technology inefficiencies should go away are the expectation. However, costs and how to go about comes in the way. Survey suggests that PAT and QBD could be mutually exclusivity, this was a surprise and as they cannot be.
For a chemical process to produce quality product complete understanding and incorporation of the physical properties of chemicals, their reaction chemistry and interaction is necessary. Understanding facilitates development of an excellent process. These are the fundamental elements of QBD and PAT.
Survey raises the following questions.
1. Do the survey answers give the direction of the company as a whole or only the thinking of the participating staff? Is the staff opinion in sync with what the management wants?
2. What is management thinking with respect to manufacturing and process technologies?
3. Are the survey questions such that by answering “yes” to one part of the survey could result in an automatic “no” for the other part of the survey i.e. consistency or lack of it?
My focus is on having the best Process Development and Manufacturing technologies so that we can have a process that is safe, environmentally sustainable and produces quality product first time and all the time without repeated analysis.
If we understand the fundamental elements, our creativity and imagineering should result in “state of the art” processes that will produce a quality product. Proper process controls are derived from such knowledge.
Unless we understand the fundamental elements, after the fact improvement effort (Lean, Six Sigma etc.) would not result in an optimum process. Actually such an effort can be expensive. Incomplete understanding will result in less than an optimum process. It will be an expensive investment as is the case in Pharmaceutical Manufacturing.
Knowledge of elements will facilitate incorporation and adoption of state of the art and new technologies. Microreactors are the new “to be discussed” technology after the pharma acronyms. They are being touted as the next best thing after sliced bread.
For the last ten plus years “micro-reactors” have been a laboratory curiosity. Microreactors are simplistically a reaction space that act as an efficient heat exchange device also. If used properly can lead to an “efficient, green and sustainable” process. They are a modified/enhanced nano-version of plate and frame heat exchangers, which have been commercial for 40+ years. Such exchangers have been primarily used as heat exchangers rather than a combination reaction and heat transfer space. They perform extremely well in their dual role. These and similar technologies have to be understood and their value capitalized. Such reactors have a place in the pharmaceuticals (specialty chemicals) and fine chemical world.
Use of innovative technologies and improvement of manufacturing practices is only possible if we understand the fundamentals and apply principles of chemical engineering for an optimum process. Effort is not expensive and once incorporated, we would see very positive results.
Girish MALHOTRA, PE
President
EPCOT International
I found some of the answers to be conflicting. The problems of technology inefficiencies should go away are the expectation. However, costs and how to go about comes in the way. Survey suggests that PAT and QBD could be mutually exclusivity, this was a surprise and as they cannot be.
For a chemical process to produce quality product complete understanding and incorporation of the physical properties of chemicals, their reaction chemistry and interaction is necessary. Understanding facilitates development of an excellent process. These are the fundamental elements of QBD and PAT.
Survey raises the following questions.
1. Do the survey answers give the direction of the company as a whole or only the thinking of the participating staff? Is the staff opinion in sync with what the management wants?
2. What is management thinking with respect to manufacturing and process technologies?
3. Are the survey questions such that by answering “yes” to one part of the survey could result in an automatic “no” for the other part of the survey i.e. consistency or lack of it?
My focus is on having the best Process Development and Manufacturing technologies so that we can have a process that is safe, environmentally sustainable and produces quality product first time and all the time without repeated analysis.
If we understand the fundamental elements, our creativity and imagineering should result in “state of the art” processes that will produce a quality product. Proper process controls are derived from such knowledge.
Unless we understand the fundamental elements, after the fact improvement effort (Lean, Six Sigma etc.) would not result in an optimum process. Actually such an effort can be expensive. Incomplete understanding will result in less than an optimum process. It will be an expensive investment as is the case in Pharmaceutical Manufacturing.
Knowledge of elements will facilitate incorporation and adoption of state of the art and new technologies. Microreactors are the new “to be discussed” technology after the pharma acronyms. They are being touted as the next best thing after sliced bread.
For the last ten plus years “micro-reactors” have been a laboratory curiosity. Microreactors are simplistically a reaction space that act as an efficient heat exchange device also. If used properly can lead to an “efficient, green and sustainable” process. They are a modified/enhanced nano-version of plate and frame heat exchangers, which have been commercial for 40+ years. Such exchangers have been primarily used as heat exchangers rather than a combination reaction and heat transfer space. They perform extremely well in their dual role. These and similar technologies have to be understood and their value capitalized. Such reactors have a place in the pharmaceuticals (specialty chemicals) and fine chemical world.
Use of innovative technologies and improvement of manufacturing practices is only possible if we understand the fundamentals and apply principles of chemical engineering for an optimum process. Effort is not expensive and once incorporated, we would see very positive results.
Girish MALHOTRA, PE
President
EPCOT International
Friday, August 21, 2009
A Pharmaceutical Challenge for Technocrats
Pharmaceuticals have their own unique technology and pricing positions compared with the other chemical products. Can we introduce innovative development and manufacturing technologies for the pharmaceuticals sector? The answer in unequivocal ‘yes!’ We just need to understand the roadblocks and overcome them.
Since we want to live forever, we are willing to pay the demanded price for a drug. Our willingness to pay for long life along with the monopoly during the life of the patent has been the primary driver for setting drug pricing. Drug prices are set at the highest level the market will bear. Once the patent expires, brand companies move on to invent new drugs.
The above two factors ensure the desired profit margins for the pharmaceutical companies. Any costs due to regulatory mandate are passed on to the consumer. Thus, the need for product, process development and manufacturing technology innovation has been minimal. Inefficiencies are an accepted part of doing business. Generics have followed ethical (brand) companies in their modus operandi.
Regulatory bodies have cajoled pharmaceutical companies toward innovation by creating PAT, CMC, QBD and other TLAs. However, these cannot be forced or mandated unless some other event takes place, which will have a financial return. [We are familiar with the phrase “you can lead the horse to water but cannot make it drink.”]
There has to be a solution for this dilemma. Only an “economic incentive” will result in innovation.
Latent blame for the lack of innovation is placed on regulatory agencies. This is unjust. The repeatability of quality at the active pharma ingredients (API) and the final formulated drug stages is mandated- as it should be. However, the “path to quality” should not be mandated. Companies should be held responsible for “quality failure”. Penalty for quality failure has to be severe. Companies should have the freedom to choose the “path to quality” as it is the road to innovation and creativity.
Providing manufacturers with the freedom to choose their “path to quality” is the equivalent of stopping the sampling of intermediates” for quality. This will force everyone to “drink the water”. Companies will save significant money, which will be additional incentive for pharmaceutical development and manufacturing technology innovation.
Stopping intermediate sampling could be encouraged and even mandated. It will happen only if we understand “everything about the raw materials and intermediates but were afraid to ask.” I am quite confident that based on the education and training that chemical engineers and chemists receive they can become the proponents of “stopping the sampling of intermediates.” With their backing we will arrive at the destination where the regulators want us to go. Technology innovation is not hard and for the technocrats it is the most exhilarating experience.
We need to keep API and drug formulation as separate processes and that will simplify innovation. In general, many articles discuss pharmaceutical process improvements. These do not include API manufacturing process improvements but only refer to formulation process improvements. McKinsey in a recent report suggests that the pharmaceutical companies have an opportunity that exceeds about $65 billion through productivity improvements in the drug formulation area. Based on my review of the API segment, I believe that the opportunity in the API sector based on yield, technology improvements and conservation far exceeds $65 billion.
The question is: “Are the chemists and chemical engineers ready and willing to take the challenge?” I know the answer and it is “Yes we can”. If we do, many of the TLAs would become irrelevant.
Girish MALHOTRA, PE
President
Since we want to live forever, we are willing to pay the demanded price for a drug. Our willingness to pay for long life along with the monopoly during the life of the patent has been the primary driver for setting drug pricing. Drug prices are set at the highest level the market will bear. Once the patent expires, brand companies move on to invent new drugs.
The above two factors ensure the desired profit margins for the pharmaceutical companies. Any costs due to regulatory mandate are passed on to the consumer. Thus, the need for product, process development and manufacturing technology innovation has been minimal. Inefficiencies are an accepted part of doing business. Generics have followed ethical (brand) companies in their modus operandi.
Regulatory bodies have cajoled pharmaceutical companies toward innovation by creating PAT, CMC, QBD and other TLAs. However, these cannot be forced or mandated unless some other event takes place, which will have a financial return. [We are familiar with the phrase “you can lead the horse to water but cannot make it drink.”]
There has to be a solution for this dilemma. Only an “economic incentive” will result in innovation.
Latent blame for the lack of innovation is placed on regulatory agencies. This is unjust. The repeatability of quality at the active pharma ingredients (API) and the final formulated drug stages is mandated- as it should be. However, the “path to quality” should not be mandated. Companies should be held responsible for “quality failure”. Penalty for quality failure has to be severe. Companies should have the freedom to choose the “path to quality” as it is the road to innovation and creativity.
Providing manufacturers with the freedom to choose their “path to quality” is the equivalent of stopping the sampling of intermediates” for quality. This will force everyone to “drink the water”. Companies will save significant money, which will be additional incentive for pharmaceutical development and manufacturing technology innovation.
Stopping intermediate sampling could be encouraged and even mandated. It will happen only if we understand “everything about the raw materials and intermediates but were afraid to ask.” I am quite confident that based on the education and training that chemical engineers and chemists receive they can become the proponents of “stopping the sampling of intermediates.” With their backing we will arrive at the destination where the regulators want us to go. Technology innovation is not hard and for the technocrats it is the most exhilarating experience.
We need to keep API and drug formulation as separate processes and that will simplify innovation. In general, many articles discuss pharmaceutical process improvements. These do not include API manufacturing process improvements but only refer to formulation process improvements. McKinsey in a recent report suggests that the pharmaceutical companies have an opportunity that exceeds about $65 billion through productivity improvements in the drug formulation area. Based on my review of the API segment, I believe that the opportunity in the API sector based on yield, technology improvements and conservation far exceeds $65 billion.
The question is: “Are the chemists and chemical engineers ready and willing to take the challenge?” I know the answer and it is “Yes we can”. If we do, many of the TLAs would become irrelevant.
Girish MALHOTRA, PE
President
Wednesday, August 5, 2009
Chemical Engineering: Understanding the Curriculum for Quality Manufacturing
Chemical Engineers during their training are taught that they will commercialize and/or operate a process that will produce consistent quality product all the time (without re-work) using a safe, sustainable and an economic process.
To achieve these objectives, we review topics that teach us the understanding of the physical properties of material (raw material, intermediate, by-product and the product) involved in the process. This allows us to understand their interaction in a reactive and/or a blending process. Chem. E. uses this information to commercialize a robust process.
If we have mastered the properties and the interaction of chemicals involved, we should be able to define the operating conditions of a process having the highest yield with above defined process characteristics. We are also taught various unit operations that we can use as is, modify and/or manipulate to produce a quality product all the time. If we are not able to achieve the objective of producing quality product using a safe and sustainable process, the first time and all the time, we have to improve our understanding so that we can have the correct process.
If I translate the Chem. E. training fundamentals to acronyms, we are taught to develop and commercialize a QUALITY BY DESIGN (QBD) process. This is our “hippocratic oath”. Anything short of this objective suggests that we need to improve.
Regulatory bodies have introduced few other acronyms in the pharmaceutical manufacturing. They are fine to have but what they mean and tell us is not totally understood. Interpretations of these vary and introduce variability. My question is: are we trying to have the best pharmaceutical manufacturing technology or are we trying to conform to the current fashion crowd?
My interpretation of QBA, CQA, CMC, DS, and PAT is as follows. If my understanding is not what the “guru’s” expect it to be, then please help with the correct interpretation.
• CQA [critical quality attributes]: We need to understand the physical properties of the materials (raw material, intermediate, by-product and the final product) and how they interact with each other.
• DS [design space]: Definition of the process operating parameters that have been identified by the developers, which if followed will produce quality product all the time.
• CMC [chemistry, manufacturing and controls]: Reaction mechanism, kinetics and process controls that is understood and followed will allow production of quality product.
• PAT [process analytical technologies]: This acronym is the least understood. It is believed that by having PAT, all of the process ills will go away. That is far from the truth. Analytical instruments will let the manufacturing and quality people know that the process has erred. However, it will not correct the problem and give a solution to the problem. Only people who are familiar with the characteristics of the materials and chemistry can correct the process. Analytical instruments are an indicator and not the corrector. There is difference between process control technologies and process analytical technologies.
• QBA [quality by analysis]: It suggests that we have a problem and we do not meet quality. We have to go back and fix the problem so that we can produce the desired quality.
To summarize the above mentioned acronyms are the fundamentals of chemical engineering curriculum. If we understand pieces parts of the curriculum, then we should have a QBD process. Question then arises why it is so hard to implement the fundamentals of chemical engineering in the manufacture of a pharmaceutical (API or a blend of API and excipients) or did I miss something.
Girish Malhotra, PE
President
To achieve these objectives, we review topics that teach us the understanding of the physical properties of material (raw material, intermediate, by-product and the product) involved in the process. This allows us to understand their interaction in a reactive and/or a blending process. Chem. E. uses this information to commercialize a robust process.
If we have mastered the properties and the interaction of chemicals involved, we should be able to define the operating conditions of a process having the highest yield with above defined process characteristics. We are also taught various unit operations that we can use as is, modify and/or manipulate to produce a quality product all the time. If we are not able to achieve the objective of producing quality product using a safe and sustainable process, the first time and all the time, we have to improve our understanding so that we can have the correct process.
If I translate the Chem. E. training fundamentals to acronyms, we are taught to develop and commercialize a QUALITY BY DESIGN (QBD) process. This is our “hippocratic oath”. Anything short of this objective suggests that we need to improve.
Regulatory bodies have introduced few other acronyms in the pharmaceutical manufacturing. They are fine to have but what they mean and tell us is not totally understood. Interpretations of these vary and introduce variability. My question is: are we trying to have the best pharmaceutical manufacturing technology or are we trying to conform to the current fashion crowd?
My interpretation of QBA, CQA, CMC, DS, and PAT is as follows. If my understanding is not what the “guru’s” expect it to be, then please help with the correct interpretation.
• CQA [critical quality attributes]: We need to understand the physical properties of the materials (raw material, intermediate, by-product and the final product) and how they interact with each other.
• DS [design space]: Definition of the process operating parameters that have been identified by the developers, which if followed will produce quality product all the time.
• CMC [chemistry, manufacturing and controls]: Reaction mechanism, kinetics and process controls that is understood and followed will allow production of quality product.
• PAT [process analytical technologies]: This acronym is the least understood. It is believed that by having PAT, all of the process ills will go away. That is far from the truth. Analytical instruments will let the manufacturing and quality people know that the process has erred. However, it will not correct the problem and give a solution to the problem. Only people who are familiar with the characteristics of the materials and chemistry can correct the process. Analytical instruments are an indicator and not the corrector. There is difference between process control technologies and process analytical technologies.
• QBA [quality by analysis]: It suggests that we have a problem and we do not meet quality. We have to go back and fix the problem so that we can produce the desired quality.
To summarize the above mentioned acronyms are the fundamentals of chemical engineering curriculum. If we understand pieces parts of the curriculum, then we should have a QBD process. Question then arises why it is so hard to implement the fundamentals of chemical engineering in the manufacture of a pharmaceutical (API or a blend of API and excipients) or did I miss something.
Girish Malhotra, PE
President
Tuesday, August 4, 2009
Climate Change and its impact on Industrial Production
Climate change is a new challenge and a major discussion point between the developed and the developing countries. Some sort of emission limits will be placed as we move forward. There is lot of posturing and both sides are making point and counterpoint.
Developed countries did not have emission restrictions during their growth. With the current demand to curb emissions, some curbs will be negotiated. Developed and developing countries are afraid of the curtailment of their industrial machine. In order to retain their industrial complex developed countries will exert pressure. However, the developing countries especially India and China are not going to readily agree to any curbs. In Secretary Clinton’s recent trip India Rejected U.S. Proposal of Carbon Limits.
A recent article India and Climate Change takes India as example and excludes China, though both present similar challenges for the developed countries.
This article states “If (the) developed nations are held responsible for emissions that they historically contributed, oblivious to their impact on climate change, why shouldn't (the) developing nations take responsibility for producing generations of people who will generate emissions into the future?” Is it an indirect admission that the developed countries are afraid of the curbing their economic growth and are afraid of the growth of the developing countries? It seems to suggest that since the developed countries control their population, they can keep emitting at the current per capita rate. Is it also suggesting that the living standards of the developed countries should stay high and of the developing countries should not? If this is the latent intent, it is not going to sit well with the developing countries.
Are we saying “Maslow’s hierarchy of needs” only applicable to the developed countries? Developed countries have had the developing countries as their market, but now they challenging us on our turf, we are not willing to accept the challenge. The game has changed and we will have to play with the new rules. Their development and negotiation is going to be a challenge.
Recently International Council of Chemical Associations engaged McKinsey & Co. to suggest steps the chemical industry needs to take to curb emissions and still innovate. This study excludes chemicals that improve the living standards (including pharmaceuticals) and assumes gross savings from such chemicals to be zero.
I have concerns about this exclusion as we are excluding an important segment (pharmaceuticals about $800 billion revenue out of $3 trillion dollars per year) that has a large carbon imprint. Pharmaceuticals (API and formulated products) present an opportunity to reduce their imprint. There is an opportunity to improve their manufacturing inefficiencies (low yield) and reduce their solvent use, there by achieving an offsetting positive impact. Technology improvement will also reduce healthcare costs. An effort is needed in earnest.
Development and global sharing of the low carbon emission technologies might be the answer. Other choice for the companies in the developed countries is to move their factories to the developing countries. Thus they would not have to implement tougher emission standards. This is not a viable option.
In the last 15-20 years countries have become dependent on each other. What was environmentally acceptable yesterday will not be acceptable tomorrow. Since the global warming will affect us all, we will have to compromise and live with the new rules whatever they might be.
Girish Malhotra, PE
President
Developed countries did not have emission restrictions during their growth. With the current demand to curb emissions, some curbs will be negotiated. Developed and developing countries are afraid of the curtailment of their industrial machine. In order to retain their industrial complex developed countries will exert pressure. However, the developing countries especially India and China are not going to readily agree to any curbs. In Secretary Clinton’s recent trip India Rejected U.S. Proposal of Carbon Limits.
A recent article India and Climate Change takes India as example and excludes China, though both present similar challenges for the developed countries.
This article states “If (the) developed nations are held responsible for emissions that they historically contributed, oblivious to their impact on climate change, why shouldn't (the) developing nations take responsibility for producing generations of people who will generate emissions into the future?” Is it an indirect admission that the developed countries are afraid of the curbing their economic growth and are afraid of the growth of the developing countries? It seems to suggest that since the developed countries control their population, they can keep emitting at the current per capita rate. Is it also suggesting that the living standards of the developed countries should stay high and of the developing countries should not? If this is the latent intent, it is not going to sit well with the developing countries.
Girish Malhotra, PE
President
Wednesday, July 8, 2009
Recycling Coatings: An Environmental and Business Opportunity
In today’s environmental concerns and how to reduce green house gases (GHG)/carbon imprint, an opportunity exists in the coating business areas and that can appease many. This is through recycling of coatings.
Recycling of coatings is a possibility and a challenge. The challenge comes from the perspective of the formulators and the raw material suppliers. Raw materials deliver the desired coating performance. If the raw materials can be used interchangeably to deliver the required performance, we can have the makings of easier recycling and better manufacturing (batch à continuous) technologies. Certain scenarios exist.
Kelly Moore, a
Over the last many years, different methods and applications of surplus coating have been considered with sporadic success. Sustained success is needed to reduce environmental impact of the coatings.
If the government mandates coating recycling through EPA regulations, it would be called meddling in the business. However, the government can assist by creating an incentive program for the companies who recycle. This could be through VOC credits. This presents the best opportunity and any company’s effort in recycling should be awarded.
A joint effort will be needed to establish such VOC credit program. Companies should decide how they develop and incorporate the recycled material in their products. Companies have the knowledge base and the creativity to develop coatings that can have significant recycled material as a part of their formulation. Strategic and interchangeable use of different raw materials is the key for recycling. This would be a win-win.
Friday, June 12, 2009
Pharmaceuticals: What is Holding Back Quality By Design?
We come across many TLAs and their number is increasing. What is a TLA? It stands for “three letter acronym”.
In the regulatory world, TLAs keep us on our toes. In the pharmaceutical world two TLAs are in vogue. They are QBA and QBD. Everyone associated with the manufacture of pharmaceuticals is familiar with these acronyms. But just to re-iterate, QBA is product “quality by analysis” and QBD is “quality by design”. QBA is the current tradition of the pharmaceutical manufacturing processes whereas QBD presents what the technology should be or the future.
Level of going on discussion is suggestive of that there is a significant hesitation to improve technology. One has to ask the question, why it is so difficult to move from “A” to “D” and I am sure many have. There has to be a monumental hurdle/roadblock for the pharmaceuticals to move from QBA to QBD.
I do not think there are any hurdles. We are just up against tradition. Since the traditions are entrenched in pharmaceuticals, we have accepted the current manufacturing practices. They have not been challenged. We are also afraid of the “Regulatory Gods”. Move from QBA to QBD is very simple and the roadblock is staring at us. However, it has not been obvious to us. I define the hurdle/roadblock for the move from “A” to “D” to be “the isolation of intermediates of the reaction or the formulation steps”. The mantra for QBD is “stopping isolation of intermediates”.
If we isolate a reaction product after every reaction step or a mix after every formulation step to test the quality and the conversion yield, we are acknowledging that we do not have a complete understanding, control of the process step and its mechanism. If we did have the understanding, we would not be isolating the reaction step and/or blend intermediate and testing them for their quality.
Specialty/Fine chemical industry by and large has a complete understanding and control of the processes. It does not necessitate isolation of the intermediates, as the quality is designed in the products. If we can achieve the same level of proficiency for the pharmaceuticals, we would move from quality by “A” [analysis] to quality by “D” [design].
In the pharmaceutical industry move from “A” → “D”, will be a major accomplishment in simplifying the manufacturing technologies and processes. It will not only improve process efficiencies and but also reduce the carbon footprint of the fine, specialty chemicals and the pharmaceutical manufacturing processes. It will reduce the cycle time for many batch processes and could nudge quite a few products to be manufactured by continuous processes.
Jumping the “A” to “D” hurdle is simple and easy. We just have to set our heart and mind to it. If it happens, my conjecture is the even the “Regulatory Gods” will celebrate.
Girish MALHOTRA, PE
President
EPCOT International
In the regulatory world, TLAs keep us on our toes. In the pharmaceutical world two TLAs are in vogue. They are QBA and QBD. Everyone associated with the manufacture of pharmaceuticals is familiar with these acronyms. But just to re-iterate, QBA is product “quality by analysis” and QBD is “quality by design”. QBA is the current tradition of the pharmaceutical manufacturing processes whereas QBD presents what the technology should be or the future.
Level of going on discussion is suggestive of that there is a significant hesitation to improve technology. One has to ask the question, why it is so difficult to move from “A” to “D” and I am sure many have. There has to be a monumental hurdle/roadblock for the pharmaceuticals to move from QBA to QBD.
I do not think there are any hurdles. We are just up against tradition. Since the traditions are entrenched in pharmaceuticals, we have accepted the current manufacturing practices. They have not been challenged. We are also afraid of the “Regulatory Gods”. Move from QBA to QBD is very simple and the roadblock is staring at us. However, it has not been obvious to us. I define the hurdle/roadblock for the move from “A” to “D” to be “the isolation of intermediates of the reaction or the formulation steps”. The mantra for QBD is “stopping isolation of intermediates”.
If we isolate a reaction product after every reaction step or a mix after every formulation step to test the quality and the conversion yield, we are acknowledging that we do not have a complete understanding, control of the process step and its mechanism. If we did have the understanding, we would not be isolating the reaction step and/or blend intermediate and testing them for their quality.
Specialty/Fine chemical industry by and large has a complete understanding and control of the processes. It does not necessitate isolation of the intermediates, as the quality is designed in the products. If we can achieve the same level of proficiency for the pharmaceuticals, we would move from quality by “A” [analysis] to quality by “D” [design].
In the pharmaceutical industry move from “A” → “D”, will be a major accomplishment in simplifying the manufacturing technologies and processes. It will not only improve process efficiencies and but also reduce the carbon footprint of the fine, specialty chemicals and the pharmaceutical manufacturing processes. It will reduce the cycle time for many batch processes and could nudge quite a few products to be manufactured by continuous processes.
Jumping the “A” to “D” hurdle is simple and easy. We just have to set our heart and mind to it. If it happens, my conjecture is the even the “Regulatory Gods” will celebrate.
Girish MALHOTRA, PE
President
EPCOT International
Monday, June 1, 2009
Process of Continuous Improvement and Pharmaceuticals
In every industry, “process of continuous improvement” is a religion as it improves their profitability. A recent article "Drug CEOs Switch Tactics on Reform" in The Wall Street Journal discusses new strategies being developed by the Pharmaceutical companies. Pharmaceutical CEO’s believe that the drug costs do not contribute to the high health-care costs. The following points are mentioned in the article.
If the health-care costs are to be reduced, it has to be full court press on every element of the costs and that includes drug costs. Drug costs cannot and should not be excluded even if they are small part of the overall costs. The pharmaceutical companies should make any effort to lower drug prices as part of their continuous business improvement process. Point #5 suggests that the drug companies want to fund the development of new drugs through raising drug prices only. If an effort is made to improve their R&D methods and manufacturing technologies, which is definitely feasible and possible, the pharmaceutical companies will not only have more funds to develop new drugs will also have higher profits.
It is well known that the current drug manufacturing technologies and methods are inefficient. Effort needs to be made to improve the manufacturing technologies. Improvement in API and drug formulation yield e.g. from 60% to 90% might not seem to be major improvement in the cost but every dollar saved adds up. These savings might be in billions of Dollars or Euros and will be more than sufficient to pay for new drug research and development.
We all need to work together to reduce healthcare costs rather than saying problem is some place else. Suggesting that the problem is elsewhere is an indirect acknowledgment by the pharmaceutical industry that we do not believe in “process of continuous improvement” thereby cannot reduce drug costs. With the effort being made by every government to reduce health care costs, I hope the pharmaceutical companies are not saying that we have no room for such improvements and “do not tread on me.”
Based on the fundamentals taught in engineering schools, every student will say that the current manufacturing methods can be improved. The real question is why such effort has not been made and what is blocking the path of “continuous improvement”. It is well known that if manufacturing methods are improved, they will improve profit margins to levels that are much higher than the current levels and some of the savings can be passed on to the customers to make it a win-win.
Question is “can and/or should an effort to reduce drug costs be made?” The answer is we should and if someone says it cannot be done then the question is why not.
Girish Malhotra, PE
President, EPCOT International
- Prescription drugs account for "just about 10% of the overall (health care) cost".
- Reforms shouldn't force doctors and patients to choose a drug based on cost if the more expensive treatment would have a better outcome.
- The drug makers have been pushing through hefty price increases. Prices for many drugs were up more than 15% in the first quarter from a year earlier, according to data from Credit Suisse.
- Drug industry executives are worried about Medicare’s authority to negotiate the prices for drugs dispensed through its Part D benefit. That could limit the prices pharmaceutical companies can charge.
- Pharmaceutical executives argue that such steps (negotiated drug prices) would hamper drug makers' ability to pay for costly research into new treatments. "It would knock our legs out".
If the health-care costs are to be reduced, it has to be full court press on every element of the costs and that includes drug costs. Drug costs cannot and should not be excluded even if they are small part of the overall costs. The pharmaceutical companies should make any effort to lower drug prices as part of their continuous business improvement process. Point #5 suggests that the drug companies want to fund the development of new drugs through raising drug prices only. If an effort is made to improve their R&D methods and manufacturing technologies, which is definitely feasible and possible, the pharmaceutical companies will not only have more funds to develop new drugs will also have higher profits.
It is well known that the current drug manufacturing technologies and methods are inefficient. Effort needs to be made to improve the manufacturing technologies. Improvement in API and drug formulation yield e.g. from 60% to 90% might not seem to be major improvement in the cost but every dollar saved adds up. These savings might be in billions of Dollars or Euros and will be more than sufficient to pay for new drug research and development.
We all need to work together to reduce healthcare costs rather than saying problem is some place else. Suggesting that the problem is elsewhere is an indirect acknowledgment by the pharmaceutical industry that we do not believe in “process of continuous improvement” thereby cannot reduce drug costs. With the effort being made by every government to reduce health care costs, I hope the pharmaceutical companies are not saying that we have no room for such improvements and “do not tread on me.”
Based on the fundamentals taught in engineering schools, every student will say that the current manufacturing methods can be improved. The real question is why such effort has not been made and what is blocking the path of “continuous improvement”. It is well known that if manufacturing methods are improved, they will improve profit margins to levels that are much higher than the current levels and some of the savings can be passed on to the customers to make it a win-win.
Question is “can and/or should an effort to reduce drug costs be made?” The answer is we should and if someone says it cannot be done then the question is why not.
Girish Malhotra, PE
President, EPCOT International
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