Is Continuous Processing in Pharma’s Future?

The answer to the question is “May be and depends”. This is not the answer everyone would be expecting from anyone who is proponent of “continuous processing”. “May be or depends” needs further explanation. I describe pharmaceutical manufacturing processes as follows.

    API (drug) + Formulation processing/packaging = Dispensable drug dose

We all know that each component and the resulting product must meet the established performance and quality standards and that is a must. Annual volume, process design and equipment are some of the factors that direct us to the right process selection.

Table 1 illustrates the amounts of API (active pharmaceutical ingredient) needed for various dosages to serve variable population size. This table directs us to the answer to the “May be and depends” question between batch and continuous processing in pharmaceutical manufacturing. Breaking down the overall manufacturing process described above assists in rationalization. 

Dose Milligram	Tablets per day	Doses per year	Patients, Millions	Tablets/yr. Millions (1)	Tablet Process		API needed,  Kg./ yr.	API Process
					Batch	Continuous		Batch	Continuous
					Number of plants			Number of plants
0.1	1	365	10	365	*	**	456	1		No
0.1	1	365	100	3650	*	**	4,563	1		No
0.5	1	365	500	91,250	*	**	114,063	1		**
10	1	365	100	365,000	*	**	456,250	*		**
10	1	365	500	1,825,000	*	**	2,281,125	*		1-2
50	1	365	10	182,500	*	**	228,125	*		**
250	1	365	500	45,625,000	*	**	57,031,250	*		5-7
500	1	365	500	91,250,000	*	**	114,062,500	*		10-14
* Multiple batch plants would be needed to meet the global demand. ** Potential continuous process. (1) 80% formulation and packaging yield.

                                                               Table 1

A quick review of the table suggests that between API manufacture and formulation/packaging later has the highest potential to be a continuous process. This observation is based on annual volume of the tablets needed. It is expected that the formulation and packaging process steps are adequately designed. Quality by Design (QbD) will be the rule for such processes.

To serve 10 million population using 0.1 milligram dose tablet, API volume is not large enough to have a continuous process. If the equipment used to produce the APIs is going to stay the same as currently used, less than optimum processes will stay in place. Since the companies with the current manufacturing practices are able to achieve their profit margins they do not have any incentive/justification to change their manufacturing practices even if the methods are inefficient and highly un-sustainable. Such operations present an excellent opportunity to improve yield, create sustainable processes, lower manufacturing costs and improve profitability.

For continuous process to become a reality for APIs while using the current equipment technologies, production volumes have to be about 750,000 pounds or higher per year per site or the size of equipment used has to change to produce for lower volumes i.e. a complete paradigm shift is needed. A single plant operating continuously (24/7/50) producing (750,000 pounds per year) would produce about 110 pounds product per hour. Such plants, if they become a reality, could significantly reduce the regulatory load significantly and would produce highest quality product.

To serve 10 million people taking 0.1 milligram tablet per day per year about 3.65 billion tablets would be needed. This is producing about 8500 tablets per minute (80% operating rate) from a single manufacturing train. A single continuous train that takes the API to a finished tablet is very feasible provided the equipment is properly designed. Depending on the size of the tablet, commercially available equipment can produce up to one million tablets per hour. Through campaigns this particular train could also be used to produce other drugs following cGMP practices. Multiple tableting and packaging trains can be used to fulfill higher tablet needs.

As the dose and frequency needs increase, the needed API volume increases and manufacturing trends toward continuous processes. Increased per site production volume and process technologies can justify better manufacturing methods that have higher yield and are sustainable. It is possible that the companies might still use batch processing even if the total API production volume could justify continuous manufacturing. This can happen if the companies do not want to invest in better process technologies. If the companies do not change their methods competition will force the change.

Based on the above review one can conclude that better than 70-80% of the APIs needed would be produced by batch process using existing type of reactors, heat exchangers and other processing equipment unless the existing equipment can be used creatively to develop continuous processes. This is definitely possible. On the other hand better than 85-95% of the formulations can be produced using continuous processes.

Above quick review demystifies “May be or depends” mystery and shows us a clear path. The choice is ours to act.

Girish Malhotra, PE

EPCOT International

Is the New Terminology Going to Make the Pharmaceutical Processes Environmentally Friendly and Economic?

Reading two recent articles in Organic Process Research & Development magazine ^(1,2) had me wondering about my chemistry and chemical engineering education and practices. They created a doubt in my mind and raised a question “would the fundamentals that we had learnt and are the building blocks of the chemical industry where chemicals are either reacted or blended to produce useful products not work anymore?”

These articles also eluded that the pharmaceutical manufacturing is different and cut above the chemical industry. A new terminology rather than the fundamentals of chemical engineering and chemistry (simple heat/energy and mass balance, improving process productivity and having an economic process) are more important and necessary to design and create an economic and sustainable process. If that is the case then things have changed dramatically and many others and I could be oblivious to the change. The new terms are process mass intensity (PMI), reaction mass efficiency, E factor, Eutrophication Potential, atom economy and space-time yield etc.

During my undergraduate degree in chemical engineering, we were taught the fundamentals of heat/energy and mass balance, organic, physical and inorganic chemistry along with unit operations and unit processes, thermodynamics, chemical reaction kinetics and economics to develop processes that when commercialized using properly designed and appropriate equipment produced quality product, had minimal impact on environment and were economical. As the time progressed environmental laws encouraged us to improve processes to minimize the ecological impact.

Based on end application of the products, the manufacturing processes were labeled differently e.g. products covering surfaces were called coatings, chemicals that have disease curing value were called pharmaceuticals, chemicals that did not have disease curing value but were used as additives were classified as fine/specialty chemicals and products from crude oil were categorized as petrochemicals and so on. However, the fundamentals that were/are applied for the process design and development have not changed much.

I am not sure how many practicing chemical engineers or chemists understand what the new terminology discussed above means or are they just fancy expressions for the fundamentals that many will not understand. Due to diverse chemistries and processes of active pharmaceutical ingredients and formulations being produced in existing equipment that is not designed and/or optimized for their production, I am not sure if these factors truly on their own can deliver a green process.

There are ninety-nine references in these articles. One is from 1994 and two are from 1999. Does the lack of prior references suggest that the chemists and chemical engineers before 1990 were totally naïve and oblivious to good process development, design and engineering practices and did not use the fundamentals to develop, design and commercialize sustainable chemical processes? Or is there a latent message that the pharmaceutical development and manufacturing is elite, complex and chemistry and chemical engineering principles apply differently to them or some other principles apply?

I hope that is not the case. If it is, then it is suggests that the manufacturing will have occasional problems. This will be manifested by our lack of command of the processing steps forcing us to rely on QbA (Quality by Analysis) methods to ensure quality of active pharmaceutical ingredients and their formulations. Occasional recalls and increasing citations are suggestive of our lack of command and control of the manufacturing practices. 

To have robust, economic and sustainable processes I strongly believe that we need to have understanding and command of the processes. That can only happen by application of fundamentals that we learn in our chemistry and chemical engineering curricula along with our creativity and imagination ^(3,4). The products produced using such processes will produce the desired quality products. Quality by Design (QbD) will prevail and the environmental impact will be minimized. 

Girish Malhotra, PE

EPCOT International

1. Jimenez-Gonzales, C. etal, Using the Right Green Yardstick: Why Process Mass Intensity is Used in the Pharmaceutical Industry to Drive More Sustainable Processes, Organic Process Research and Development, Org. Process Res. Dev., 2011, 15, pgs. 912–917
2.  Jimenez-Gonzales, C. etal, Key Green Engineering Research Areas for Sustainable Manufacturing: A Perspective from Pharmaceutical and Fine Chemicals Manufacturers, Org. Process Res. Dev., 2011, 15, pgs. 900–911
3. Malhotra, Girish: Chemical Process Simplification: Improving Productivity and Sustainability, February 2011, John Wiley & Sons Inc.
4. Malhotra, Girish: Focus on Physical Properties To Improve Processes, Chemical Engineering, Vol. 119, No. 4, April 2012, pgs. 63-66

Financial Justification for QbD and Cost of Regulation Compliance

QbD (Quality by Design a.k.a. having a robust and repeatable process which produces quality product without rework or re-testing) is financially important for the pharmaceutical industry and highly beneficial for the consumers; as it will ensure quality all the time, potentially alleviate shortages and lower costs. In order for QbD to become part of pharma landscape “C” and “E” levels of the companies need to have a very clear understanding of cost of regulatory compliance and financial benefits of QbD. Even with the understanding, timely implementation will need considerable cajoling within each company. I am not being opportunistic or pessimistic but being realistic.

I have discussed some of the ways to drive to QbD in my earlier articles ^(1,2,3). I have deliberately not been explicit about the methods because I want the companies to find their own justifications. Pride of ownership is an excellent driver. I have, however, eluded on “how to” methods and ways. In this article I have further expanded on my perspective and source of QbD justification funding.

Unless QbD related costs are financially justified, especially for the existing products, not much will change. One source of funding is to pass the costs through drug sale price increase. That might be very difficult. The other source of funding can be the savings achieved from lower compliance cost expenditures once the QbD processes are in place. I expect that once the QbD based processes are in place and companies have rationalized their manufacturing practices and strategies, they will have significant savings which will offset their QbD effort. Regulatory bodies and the regulators at the companies might not agree with me about lowering compliance costs but besides yield improvements this is an area in the manufacturing hemisphere where I believe significant cost saving opportunities exist. There are other cost saving areas and each company has to define and identify them.

Companies have to think QbD for the new products from the start. If it happens, it will be a win-win for the companies and patients.

Basic premise of regulations is that we have to be able to track everything we do in the manufacture of drugs and the processes have to be reproducible and repeatable. Pharmaceutical industry should have taken the lead to track, control and monitor their processes. Since self-policing did not happen on a dependable basis, regulations had to be established to ensure product consistency and quality. With the establishment of regulations companies have focused on how to satisfy the regulatory requirements and in turn have lagged and are stifled on manufacturing technology innovation. Since the associated regulatory and compliance costs are passed on to the customers, need to have the best and sustainable manufacturing technology has not been a primary concern.

Since pharmaceutical products are for human consumption, they have to have the highest quality. However, the producers have not been proactive in exceeding quality or regulatory standards. To achieve quality for the active pharmaceutical ingredients and formulated drugs they have relied on QbA (repeated analysis) methodologies. This practice has delivered quality product but it is an expensive way to comply. Even with such effort poor quality products have ended up in the market, had notable recalls and product shortages are an ongoing saga.

Due to lack of significant movement toward QbD based processes, regulatory bodies are establishing additional regulations. These regulations will force the industry to have robust processes that are optimum and sustainable. Industry will blame regulations but will have to comply, increasing drug costs. Had the industry seen value in QbD it would have seen touting the benefits in print.

Industry has spent money on “how to comply” rather than how to innovate and have processes that will exceed the regulatory guidelines. The current regulatory guidelines are minimal at best and the industry should not have any trouble complying or exceeding but has had on going issues as discussed above.

In order to offset QbD associated costs, total “compliance costs” incurred at a company site or associated with every drug have to be completely understood. It is my conjecture that majority of the “C” and “E” levels do not know their actual compliance costs including costs associated with every quality related mishap. They are probably buried in the accounting maze and different department budgets.

For QbD to happen and if it happens, it is very possible that eventually it could result in some thinning of the workforce. The very thought of such a scenario in the current environment is not an exciting perspective. Could the work force reduction possibility be a QbD deterrent? I do not know the answer. I believe that QbD implementation will presents opportunities at the pharmaceutical companies and should create jobs at universities and companies who create methods and products to advance manufacturing technologies. 

I believe that going the QbD path could also reduce the workload of the regulatory bodies and actually allow more to be done. Approval process could be shortened. Penalties for poor product quality and non-compliance have to be stiffer than what they are today.

Strategic manufacturing, technology innovation, higher profits and shortened time to market are the QbD drivers. Industry should have been there fifty plus years ago. The current blockbuster business model absorbed all of the manufacturing deficiencies. Shareholders got accustomed to the fast paced introduction of new drugs and profits. With the drying product pipeline, companies are looking at different methods to shore up their profits. Higher profits through better technologies and lowering compliance costs could be one additional and simpler way.

Biotech processes have to be carefully reviewed to ensure that they do not fall into the existing manufacturing technology mold that has been around for the small molecule drugs. What I have read so far does not seem very innovative. We have to have processes that produce quality products by design rather than analysis.

Is it time to relinquish the current practices?

Are the recent increasing recalls, 483 citations and plant shutdowns due to lack of industry’s proactive stance to produce quality products or their stance to barely meet regulatory guidelines? These incidences suggest that the industry is having a difficult time meeting the minimum established guidelines to manage their manufacturing practices. This clearly begs a question. Does the industry fully understand their raw materials, equipment and manufacturing practices or have they put a square plug in a round hole with the hope that all will be OK at the end if they monitor every step of the manufacturing   process? If all the above is true then the pharmaceuticals are the prime candidates for creative destruction ⁽⁴⁾ and/or disruptive innovation ⁽⁵⁾ or their combination.

As long as humans will live they will need drugs. Costs related to drug approval will not go away. Costs related to regulations outlined in 21 CFR 210& 211 and others that control and track manufacturing are here to stay. Pharmaceutical industry has to figure out how to innovate, manage and control these costs while complying and/or exceeding what is expected. Pharma might have to move from the “blockbuster model and “me-too model” to some other model ⁽³⁾. Strategic bets are needed ⁽⁶⁾. 

Manufacturing processes that are based on fundamentals of chemistry, chemical engineering and sound economic principles do deliver quality products. They could fit the QbD definition. Processes that are inefficient require repeated quality analysis and their products cost more. To lower compliance costs companies have to have complete command and control of their manufacturing practices. This can only happen if they understand physical and chemical properties of the chemicals they use, their nuances and implication of any raw material changes. In addition, they have to be able to exploit them to create economic and sustainable processes. Understanding and exploitation starts as soon as the process development begins in the laboratory and stays through the life of the product.

Funding for QbD

If regulations become mandatory companies will need funding to move their existing processes to QbD mode. There are two sources for such funding.

1.     Pass the costs to the patients

2.     Pay for the costs through cost reductions

The first alternative is not going to work in today’s increasing government cost controls, declining/drying new product pipeline and the customers asking for lower prices. The other alternative is to offset some of the current expenses. This can be achieved by having processes that are efficient (improved yield, sustainable and better asset utilization) and do not require current levels of handholding. Processes will have to exceed current regulatory guidelines at lower cost.

Record keeping is not going to go away. With that in mind, manufacturing processes, strategies and technologies need a total revamp. Industry has to take the lead rather than someone outside the organization i.e. a regulatory body telling them how to walk. Companies have to sprint the course and win the race regulatory bodies are asking to walk. It will reduce quality issues, recalls, shortages and many of the 483 and other citations ⁽⁷⁾ if we do prepare for the race correctly. QbD also will improve cash flow and un-necessary and unproductive capital investment.   

Since I have not seen any published cost of compliance monetary numbers, I am presenting my perspective as to where the savings can come from. They are based on certain assumptions. Companies can plug in their own numbers to see what is possible and doable. Global pharmaceutical sales are expected to be around $1.1 trillion ⁽⁸⁾ in 2014. Table 1 illustrates saving based on my assumption.

Global pharmaceutical revenue, $ billion (Year 2012)	900
Cost of Sales @ 30% (avg. an assumption (9)) of revenue, $ billion	270
R & D @ 20% (avg. an assumption (9)) of revenue, $ billion	180
Sum of Cost of Sales and R&D, $ billion	450
Assumption: About 30% (assumption) of the Cost of Sales and R&D money are Cost of Compliance. Total cost of compliance, $ billion	150

                                                            Table 1

I have used 30% sum of cost of sales and R&D as cost of compliance. I believe this to be a conservative number. It can include costs related to current methods of achieving quality, paper work, quarantine costs, cost of inventory, cost of recalls, infrastructure costs to quarantine materials and litigation, recall, rework and disposal costs. If I have missed any other item, the costs will change accordingly. If any one has a better number, I would appreciate knowing about it.

If through better process technologies i.e. improved yield, reduced in-process quality checks (elimination/reduction of QbA), sustainable processes, plant consolidations (economies of scale: batch vs. continuous), improved asset utilization (e.g. moving from 30-40% to 60-75% asset utilization) and better record keeping companies can save 40 to 50% of the “cost of compliance” as speculated in Table 1, we could be saving between $60.00 to $75.00 billion per year.

As I stated earlier, if my assumption can be on the lower side and the savings dollars could be higher. If anyone has a better number for cost of compliance, it would be wonderful to share. These savings relative to the total pharmaceutical sales revenue might not seem much but still raise a challenge to all of us “Has the time to excel and exceed quality using innovative manufacturing technologies come in Pharmaceuticals?” I believe so. Magnitude of savings outlined above can create many new millionaires. It might even create few new billionaires.

It is my firm belief that if we incorporate fundamentals of chemistry and chemical engineering in our processes to manufacture products from the day we start developing new manufacturing processes our products will meet quality standards the first time and every dollar that is not spent on compliance will drop to the profit before tax line. Pharmaceutical industry has to change its modus operandi. There are no alternates left.

Girish Malhotra, PE

EPCOT International

1.   Malhotra, Girish: Who or What killed QbD? And is there hope for resuscitation? Pharmaceutical Processing, May 2011, pg 10-14

2.   Malhotra, Girish: A Guide to QbD for APIs, Pharmaceutical Processing, Volume 27, No. 4 May 2012, pg 46-49


3.   Malhotra, Girish: Focus on Physical Properties To Improve Processes: Chemical Engineering, Vol. 119 No. 4 April 2012, pgs. 63-66

4.   Schumpeter, Joseph A. Capitalism, Socialism and Democracy, Chapter VII: The Process of Creative Destruction 3rd Edition 1950, Harper Torchbooks, New York, 1962

5.   Christensen, Clayton M., The Innovator's Dilemma: The Revolutionary Book that Will Change the Way You Do Business, Harvard Business Press Books, Jun 11, 1997. 

6.   Charan, Ram and Sisk, Michael, Strategic Bets, Strategy+business May 24, 2011

7.   FDA Citations FY 2010 Inspections, Compliance, Enforcement, and Criminal Investigations Accessed May 15, 2012

8.   Global Pharma Sales Steadily Growing Despite Rise of Generics Accessed May 15, 2012

9.   Based on Annual reports of different Pharmaceutical companies.

Can the Combination of Creative Destruction and “Steve Jobs’ Traits” Lead to Pharma QbD Spring?

The answer to the question of whether there could be a revolution to bring about Quality by Design (QbD) in pharmaceutical manufacturing, unequivocally, is yes. But we need some outsiders who can conspire with the insiders to be the flag bearers within pharma companies. Outsiders can be the counsels/co-conspirators to the insiders for the coup-d’état. Chemists and chemical engineers associated within the industry need to review what is happening in their process development, commercialization and manufacturing practices. They need to pick one process for their revolution. Success there would spread like wild fire within the company and in the industry. We need small successes to create the full blown ‘spring.’

Insiders need some tools. Some of these have been discussed in my earlier blogs but I wanted to discuss some specifics that might assist their creativity and imagination.

Recently, I expressed my views how to improve and innovate processes by exploiting physical and chemical properties (Chemical Engineering, Vol. 119, No 4, April 2012 pgs. 63-66) of the raw materials that produce products that are use to produce different products.

Besides exploiting [chemical] properties there are other avenues that are available to us to improve technology and manufacturing methods. However, due to tradition and what we learn during our education and professional life, circumstances and company culture, either we overlook or do not consider situations that could simplify technology and manufacturing practices. No one is at fault as most of us are tradition bound and have not experienced creative destruction or exploited our “Steve Jobs” traits. I have seen many different interpretations of Steve Jobs traits. However, I liked the ’10 Traits of Steve Jobs That Can Make you a Better Street Photographer’ most as they encourage simplicity, imagination and creativity. Cases of creative destruction are well documented as business cases in literature.

Steve Jobs was a creative destructionist. He was able to accomplish what he wanted. Many pundits will question his methods but he changed the playing field for years to come. Multiple revolutions and most of us love Apple products. It is ironic that he stumbled at first, was ousted from the company he created - a humiliating experience - but he did not lose his vision for simplicity and innovation.

Going back to how, what and why innovation is possible in pharmaceuticals, chemicals and other related industries requires developers, engineers and scientists to be continuously thinking out of the box while living in the box. The tools and methods are available to us. They are around and in front of us. We are either intimidated or are afraid to say why we are doing what we are doing. Questioning what delivers profits can be considered counterproductive. However, better understanding of what we do catalyzes improvements.

I believe that challenging the status quo and “what if” exercise can be an important place to start simplification and innovation of every process. Following are two illustrations related to challenging the status quo of chemical reactions i.e. Active pharmaceutical ingredient (API) manufacturing. They can be extended to any formulation. This discussion is no reflection or criticism of any company or its people, practices or processes but examples of alternate possibilities that are simple, safe and environmentally friendly.

Chemical reactions

1. Acetylation of p-Aminophenol (PAP) to acetaminophen:

This is an age-old reaction where acetic anhydride is reacted with PAP to produce the product. However, since acetic anhydride has become a controlled substance, thanks to the producers of methamphetamine, regulations control its usage. The process as executed needs neutralization of the excess materials and by products. However, there is an alternate method staring at us that can produce the product at higher yield with lower effluent. Due to intellectual property considerations I am not able to discuss the alternate process. Alternate chemistry is part of the textbooks but we have not practiced or tested it because it is not mentioned in our textbooks or taught in our classes. We have missed to see what is in front of us.

2. Sodium salt of ring closed of o-phenol amines:

In these reactions traditional chemistry involves diazotization of the corresponding amine with sodium nitrite and an acid. After the ring closure, the product is washed, distilled and added so that the appropriate concentration of sodium salt solution is produced. All this is very traditional. NOx emissions and effluent have to be managed in the existing process. Process yield has room for improvement.

In an alternate process, appropriate stoichiometric amounts of amine are reacted under pressure with sodium nitrite at elevated temperature to produce the corresponding sodium triazole solution. Yield is much higher than the diazo route process mentioned earlier. It is a cleaner process with minimal emissions and effluent. This chemistry is not discussed in the textbooks, at least I have not seen it, but it is applied commercially.

My point of illustrating the above examples is to highlight that methods not mentioned in the textbooks or literature should be considered. They can create simple, sustainable and cost effective processes. Literature and patents are full of many such ideas that give us clues to improve processes.

Cost sheets:

The development of product cost sheets is an excellent tool that can lead to process simplification and innovation. Every cost sheet has two segments; raw material cost; and conversion cost.

A ‘what if’ exercise with alternate yield and stoichiometry can show us the impact of process technology improvement. They coax us to imagine, create and eventually assist us in developing better technologies and sustainable processes.

Raw material prices have significant influence on the total product cost i.e. profitability. Most of the time people think that we do not have much influence on the suggested price from suppliers. I would beg to differ. If we understand how the needed raw materials are produced, we can estimate supplier’s costs and profit margins i.e. our purchase price. This might sound like a very cumbersome exercise and it can be a challenge, but since our profitability needs to be maximized, such an exercise is worth the effort.

Conversion costs consist of various costs segments such as labor (hourly and salaried), utilities, maintenance, depreciation and miscellaneous items. How we operate the plant can influence the contribution of each element and their influence on a product’s cost.

Over the years while doing ‘what if’ exercises I have developed some guidelines that are useful to me. They are my rules that have helped me to develop a starting point for process simplification and improvements. These can be altered based on the chemistry and complexity of the process.

The process yield of any process step should not fall below 66%. If the yield is below this benchmark, the chemistry and its execution need help. Since there can be multiple steps for the whole process, the overall yield can drop significantly. A five-step process each having 66% yield will have an overall yield of about 12.5% (0.66 x 0.66 x 0.66 x 0.66 x 0.66=0.125), suggesting significant opportunities. My goal is to maximize the yield for the whole process to above 85%. This might look unattainable but unless we strive to get there we will not achieve our objectives.

Another rule that I have developed is that ratio of raw material cost - to - conversion cost ratio should be around 1.5 - to - 2.0. Depending on the complexity of the process there can be some variation. As we edge closer to one or less, the process needs significant work to improve its processing methods and execution time. We are also encouraging and creating an opportunity for the competition and we have done that in pharmaceuticals.

Consulting companies such as McKinsey are using cost sheet exercises to assist clients in improving their profitability.

My conjecture is that with the pharmaceutical companies losing billions of dollars/year due to patent expiries, poor product quality recalls, and increasing citations, the time for a ‘Pharma QbD Spring’ has come. As I stated earlier, we need to be cognitive and selective about which products we need to consider and innovate. We need small successes that need to be publicized and they will have a domino effect on the industry and our spring will then have arrived.

Girish Malhotra, PE

President

EPCOT International