Guy Villax is Chief Executive Officer of Hovione FarmaCiencia SA and a member of the Board of the EFCG.

Guy Villax

In 2005, a small delegation (myself included) of the European Fine Chemicals Group (EFCG) met with the deputy head of the cabinet of Commissioner Kyprianou (the then Commissioner responsible for health and consumer protection). Our mission was simple — we were there to raise a red flag.  

We were concerned that substandard APIs were a growing problem and, in our opinion, the root-cause lay in break-neck globalization and rogue players taking advantage of the virtual absence of effective oversight on European laws governing minimum quality standards. We were given 20 minutes, by which time it was made abundantly clear to us that we must be from another planet. We were told that all was well, and that "in the EU the architecture of quality of medicines is firmly based around the Qualified Person and that there is no such issue of substandard APIs in the EU". In several other meetings with the Commission and with the EMEA, we were looked at with disbelief and almost horror every time we raised the spectre of noncompliance as a deliberate business strategy. In between the lines we could read "how can the EU's API industry sink so low as to try to make up for its lost competitiveness by scare-mongering". 

During the last few years, the EFCG has worked hard to provide the correct data to EU regulators, but it has been a struggle; in part because EU officials and EU medicines agencies hate to leave their comfort zone and explore new territory where values and society are vastly different from those of Socrates, Beethoven, Pasteur, Galileo or Churchill. Even today in 2009, only at the very top of the European Commission or of the EMEA do we find leadership that is cognizant that EU medicines agencies are obsolete in so far as their oversight role is concerned regarding API compliance; the 27 agencies still inspect on proximity and not on risk. In June 2008, when a newspaper quoted me on this and the head of one of the EU medicines agencies was confronted in a public conference on the matter, my comments were dismissed as unfounded and coming from someone that had little understanding of the operations of EU medicines agencies. 

Most regulators still live in the 20th century. During the last 25 years, Europe — with the explosion of off-patent medicines — has moved from being the cradle of the pharmaceutical industry, and the dominant player in the fermentation and synthesis of APIs, to a hasbeen; fermentation has virtually disappeared from Europe and the EU API industry is only thriving because of innovators and because of the US market where tough hurdles set up by the FDA separate the wheat from the chaff.  

Asian revolution caught regulators by surprise

Today, approximately 80% of all EU medicines are made with APIs that have come from India or China, which in itself is not a problem were it not for the fact that these APIs come from plants that are unlikely to ever have been inspected by an EU official. Furthermore, the absence of effective enforcement encourages criminals to flourish and profit, and allows them to get away without any consequences. 

Shifting a major part of API production to Asia took place at lightening speed; within 25 years the shape of the industry was transformed. The medicines agencies, however, were created when businesses were national in geographical spread, and it is understandable that regulators were caught by surprise. What we cannot accept is that those charged to ensure medicines are safe and effective remain in denial. It is difficult to understand why inspectors from the medicines agencies do not attend the annual CPhI meeting — the largest global exhibition of pharmaceutical ingredients producers held in Europe each Autumn — if anything as part of their training to really grasp the size and nature of the market they are responsible for supervising. 

In 2005, the EFCG issued a questionnaire to the 27 European medicines agencies to assess their ability to enforce compliance with GMPs for APIs that had only become law in October 2005. Six agencies responded and we could conclude that a law existed, but had no enforcement. It appeared that most respondents were happier to remain in their comfort zone. 

Globalization has provided us with many lowcost items, which has enabled the West to enjoy an unprecedented standard of living. Competition is desirable, but as far as medicines are concerned, in the absence of an arbiter of quality, the most unscrupulous player is sure to win every time. 

The EFCG's argument is that API producers must be the object of more than just self-regulation; there is too much at stake and regulators must assure four elements: 			

A clear, well-understood set of laws, guidelines and rules setting out the minimum quality standard that must be met and demonstrated. 

A registration system that gives regulators an inventory of all foreign producers that intend their APIs to be made into EU medicines. 

A sufficient amount of oversight mechanisms and inspections, which are likely to result in the identification of noncompliant firms. 

Sanctions of a wellcalibrated severity that, combined with precedent (the probability of being caught), deter firms from adopting noncompliance as a strategy and ensure that they do not ever knowingly release noncompliant products.   

The European Directorate for the Quality of Medicines & Healthcare (EDQM) is probably the only agency in Europe that, for many years now, has done its best to inspect facilities in Asia. In 10 years, they have conducted approximately 160 API inspections and as a result more than 50 certificates of suitability (CEPs) were either withdrawn or suspended. All these suspended/withdrawn CEPs covered APIs manufactured in India or China whereas to date, not one CEP relating to an API manufactured in Europe has been suspended/withdrawn. These results show that many unsafe APIs — and certainly many more than these ca. 50 as the EDQM only inspects a fraction of all CEP holders — had been included in medicines for European patients for years. The health implications of this are, as yet, unknown. 

By December 2007, the tide had started to change. The majority of the MEPs had signed the written declaration on the need for much stricter authority oversight over APIs; at the same time the US Congress was lambasting the FDA for not protecting the American people against unsafe APIs. Indeed, well before the 2008 Heparin incident, the EU Commission, EMEA and FDA had already sent clear signals: new measures were necessary to address globalization and the growing incidence of substandard and rogue APIs, as well as counterfeits. 

In 2008, there were approximately 150 deaths in the US because of contaminated heparin. No one has come forward with a more plausible explanation than pointing at greedy criminals keen on making a profit. Yet the issue has further ramifications, and many are still surprisingly in denial: 				

			Every time we face a serious global threat — gentamicin (1994, 1999), Ltryptophan (1989) or heparin (2008) — the casualties are all in the US. Are Europeans more resistant against toxic contaminants or is our data collection faulty? 

EU medicine agencies still lack information on the names of the API manufacturers that import into Europe, unlike the US or Japan that have lists. 

There is no mechanism for EU medicines agencies to enable EU customs services to block entry of APIs coming from plants known to be severely noncompliant or fraudulent. 

The European Generics Association has stated that there was still no evidence to date of any counterfeited generics being on the market in Europe. 

In Europe, if pharmaceutical companies are aware of noncompliance issues they must notify health authorities and initiate a recall from the market. However, if they become aware of counterfeit versions of their medicines, there is no legislation to oblige them to notify health authorities or to trigger a recall from the market.     

Finally, the pharmaceutical industry, in a bid to address these issues, is beginning to work together. Rx360 is an international industry consortium that brings together the complete global supply chain: innovators and generics; East and West; primary and secondary manufacturers and middlemen; and medicines agencies have also been invited to participate. The consortium will hold its first meeting in Washington (USA) on 5 June, and the EFCG and the Active Pharmaceutical Ingredients Committee will be present and are supporting this initiative. 

There is still so much to do, but finally we seem to be moving in the right direction. In June 2008, Thomas Lönngren, Head of the EMEA, said: "This is a new scenario for us as regulators on both sides of the Atlantic. Suddenly we discover that we have important manufacturing far away that we don't have any control of."  

 is Chief Executive Officer of Hovione FarmaCiencia SA and a member of the Board of the EFCG. 

Articles

In 2005, a small delegation (myself included) of the European Fine Chemicals Group (EFCG) met with the deputy head of the cabinet of Commissioner Kyprianou (the then Commissioner responsible for health and consumer protection). Our mission was simple - we were there to raise a red flag.

Substandard APIs: we must tackle the problem together

The Active Pharmaceutical Ingredients Committee (APIC) — a sector group of Conseil European des Federations de l'Industrie Chimique (CEFIC) — first voiced the need for EU GMP API legislation in 1993 to help ensure the safety of medicines. In 2000, the International Conference on Harmonisation (ICH) finalized the harmonized API GMP Guideline Q7, which became legal in the US and Japan in 2001. The EU adopted a directive in March 2004 that includes the requirement for APIs in medicines for the EU market to comply with ICH/Q7A. Member States are transposing the directive into their national law: about half of them have completed this process, seven more are well on their way to completion, while seven others are still in earlier stages of adoption.   

A basic principle of the EU directive is that API compliance for medicines for the EU market should be primarily assured by the qualified person (QP) of the manufacturer and/or importer of the final medicinal product. This strongly differs from US/FDA practice in which inspections of API manufacturing facilities are a key element of the approval process of medicines.  

To be clear, the European Fine Chemicals Group's (EFCG's) concerns are not directed towards the manufacturers and users of APIs for medicinal products that are covered by patents. Instead, they are directed against the manufacture, trading and use of off-patent APIs, for which there is extensive competition in the marketplace and less control of quality standards along the — often long — manufacturing supply chain compared with APIs for medicinal products still under patent. 

It was the 2004 APIC Lisbon conference that galvanized the CEOs of EU producers of off-patent APIs to put their case to the authorities and other stakeholders through the then newly formed EFCG. The presentations by EU medicines agencies made it clear that they were not contemplating inspection of foreign, off-patent API manufacturers as a key part of their compliance enforcement strategy.  

EFCG is aware that the large majority of off-patent APIs in EU medicines are imported, mainly from India and China. We are also aware that the number of European directorate for the quality of medicines (EDQM)-initiated inspections of non-EU API sites over the past decade has been very low indeed (less than 50), and of those that have been inspected, the number of serious noncompliance cases were at a worrying level.  

EFCG believes that to guarantee the safety of EU medicines, serious consideration must be given to a focused inspections programme of off-patent, API manufacturers outside the EU and at the intermediary points inside the EU (importer, trader, broker), prioritized whenever possible by evidence of suspicious behaviour, but also including a random element.  

Given the increasing pressure on prices of off-patent medicines, we feel that their safety is very likely to start presenting unacceptable risks to European citizens. Why? Because GMP-compliant companies know that compliance requires significant investment in people, as well as in equipment. It is unsurprising, therefore, that cost cutting, especially for off-patent medicines, is a factor that increasingly conflicts with compliance. What is less well understood is that the use of safe APIs forms a negligible factor in the cost of healthcare. The costs saved by noncompliance are only of relevance at "API business level" and have little, if any, impact on the price of final medicine to the patient.  

EFCG remains concerned that the potential risk to public health presented by the strong possibility of non-GMP-compliant, off-patent APIs in EU medicines is increasing. It is important to keep reminding all stakeholders that without effective law enforcement, deterrence and sanctions, the quality of our medicines is compromised and the noncompliant operator is likely to continue business in the EU undetected. 

Many thousands of manufacturing plants for off-patent APIs in those non-EU countries are unlikely to have ever been inspected by an EU official. But what we do not know is how many of them are Q7A-compliant. For the majority of EU medicines containing off-patent APIs the authorities have not confirmed (through their inspections of the API manufacturers or traders) that the APIs are Q7A-compliant and safe. Curiously, although most of the APIs come from Asia, the majority of inspections by EU inspectors are conducted in Europe where, according to the results of EDQM's inspections, very little serious noncompliance has been observed. Also, as CEP (Certificate of Suitability)

statistics seem to indicate, EU off-patent API producers trigger the vast majority the API-related "variations submissions". Does this mean Asian producers never change their processes, or that they have inadequate change control procedures?  

EFCG has accepted the challenge to initiate a change of mindset in off-patent API producers, users, regulators and politicians. We have given annual press conferences during CPhI, first in Brussels (2004), then in Madrid (2005) and last year in Paris. We have met with many stakeholders, regulators, politicians, industry representatives, media, nongovernment organizations (NGOs) and others. EFCG has also published several articles

 and has issued its "simple guide" to buying GMP and regulatory-compliant APIs.

In 2005/2006, we performed a benchmarking exercise across the EU to assess the extent of readiness of the medicines agencies to enforce API compliance. The head of the Spanish Medicines Agency opened our Barcelona conference in April 2006 by announcing that her agency would be doubling the number of inspectors in 2007, which was very good news, but she was unwilling to commit to an increase in the number of overseas inspections. At that event, EFCG reported the results of the benchmarking exercise. It was concluded that there was a common understanding of the issues, a common shortage of inspection resources and there were only limited intentions to inspect outside of the Member States' jurisdiction. 

A German lawyer speaking at the conference believed that the QP's personal legal liability is much less than what is generally understood. If this is so, the QP appears to be less accountable than a certified accountant who signs off the financial statements of public companies. In our opinion, this contrasts sharply with the importance of securing the safety of EU medicines.  

During 2006, more information became available on the 1990s Biochimica Opos API affair on illegal APIs.

  More than € 100 million have now been paid in fines and damages. An account on FDA's investigation showed that cefaclor manufacturing steps were secretly performed in unapproved facilities in Italy, France and Romania while fake production records were kept.

  Manufacturing processes were very different from the original, authorized drug applications. 

In 2005, a former manager of Biochimica Opos was arrested by the US authorities on entering the US at Miami airport. He was held in detention for 13 months and personally fined $16 million. The system in Europe heavily relies on individuals and companies obeying the law and much less on its enforcement. We have been unable to find significant examples of API-related sanctions within the EU that would deter determined, noncompliant manufacturers. 

We were pleased to note that in 2006, the European Agency for the Evaluation of Medicinal Products (EMEA) started an EU-wide API programme that, 

, provides all the medicines agencies with a checklist for inspectors. EMEA stated that this initiative serves two purposes: 

 To support and harmonize training on how to enforce and verify API compliance when inspecting dosage form manufacturers. 

 To gather information to assess the compliance situation regarding APIs. 

We are eagerly awaiting the outcomes of this data-gathering exercise and look forward to EMEA sharing any available data with us. 

The APIC Audit Program has been completely revised to bring it in line with EMEA's guidance on the responsibility of auditing active substances manufacturers by the Manufacturing Authorization Holders for medicinal products in Europe. This audit programme now provides a third party option for auditing active substance manufacturers and is developing very well. 

In 2006, another US initiative attracted our attention: the United States Pharmacopeia (USP) has launched its "Pharmaceutical Ingredient Verification and Qualification Program".

  The USP website claims that "USP has established the world's most rigorous third-party verification programme for APIs and excipients". This essentially comes down to the USP granting its seal of approval after having performed a thorough, product-specific audit covering both GMP and — possibly — regulatory compliance (this latter aspect remains as yet unclear). 

The leading US trade association representing API producers, Synthetic Organic Chemical Manufacturers Association (SOCMA),

  joined EFCG last summer to develop a joint position paper arguing for the need of a level playing field to enforce GMP and regulatory compliance of APIs.

  Whereas FDA is very tough, and sets high regulatory standards and hurdles for the APIs for prescription medicines, there is very little regulatory control over APIs for over the counter (OTC) products. There is neither a requirement for a preapproval inspection nor for regulatory (DMF) submissions. Therefore, for OTC products, any supplier that meets the specification seems acceptable. In contrast, APIs for OTC products in the EU must meet similar standards as those for prescription medicines.  

The most recent development to recognize the lack of effective enforcement of European laws governing GMP compliance for APIs, has been the approval of the Written Declaration (0061/2006) in November 2006 by a majority of EU Parliament members. This states that worldwide GMP inspections of API manufacturers by European inspectorates should be mandatory for every API included in a medicine marketed in the EU, and that every such API should have a Certificate of GMP Compliance issued by an EU member state. The Written Declaration has been forwarded to the European Commission, the Council of the EU and the Member States for further action. This official position taken by the elected representatives of around 250 million Europeans is very similar to the one included in the APIC position paper of 24 December 2004 and adopted by EFCG as the cornerstone of its advocacy programme.

In conclusion, EFCG believes that it has helped to advance the agenda on the need for the effective enforcement of GMP compliance of off-patent APIs, but there is still much more to do to convince the authorities to take further action. We see support for our actions from many quarters, particularly the EU Parliament through its Written Declaration, but we still do not have tangible progress on enforcement. Consequently, we would welcome the following recommendations by the EU authorities:   

To create an EU Foreign Inspection Service in concert with the EU medicines agencies with a capacity to inspect at least 100 non-EU API manufacturers per year for both GMP and regulatory related compliance. It also seems reasonable that those intending to export APIs to the EU should pay fees towards the costs of this service. 

 The European medicines agencies should harmonize and coordinate the courses of action to be taken when a seriously noncompliant API is identified. This should include measures to block the import of such APIs into the EU by involving the EU Customs services. As a strong deterrent to others, effective sanctions must follow so that it becomes widely known that it does not pay to break EU law. EFCG is unaware of any progress on coordinated action by the European medicines agencies to deal with the consequences of suspended CEPs.

EFCG urges the Commission to recognize that legislation without full implementation and enforcement (via inspections), and without tough, appropriate deterrents and sanctions, is ineffective and a cause of increasing the risk to EU citizens, as well as leading to market distortions. Without proper enforcement and deterrents in place, GMP and regulatory noncompliance by manufacturers of off-patent APIs will continue to threaten the safety of European medicines containing them and will remain a major competitive advantage to overseas suppliers. A recently published Chinese article on the API compliance situation in China would seem to support this view.

An additional concern is the information given in a recent article reporting on corruption within the Chinese SFDA during the period 1998–2005.

  It appears 170000 GMP and production licences may have been granted improperly with possible implications for public health.  

is a board member of APIC and EFCG (Portugal).			

www.gmpapi.migg.com/download/asp/lasp_17508_2_21810.asp?MENUID=2

3. Hoechst 1997 Annual Report, p 71, note 8. 

4. Investigators' Reports: Foreign Drug Firm Pleads Guilty to Felony Charges 

7. Uneven Enforcement Leads to Sub-par Drugs and National Security Risk http://

8. No Safe Medicines Without Safe Ingredients 

10. China's State FDA fights for its future, 

The Active Pharmaceutical Ingredients Committee (APIC) - a sector group of Conseil European des Federations de l'Industrie Chimique (CEFIC) - first voiced the need for EU GMP API legislation in 1993 to help ensure the safety of medicines. In 2000, the International Conference on Harmonisation (ICH) finalized the harmonized API GMP Guideline Q7, which became legal in the US and Japan in 2001. The EU adopted a directive in March 2004 that includes the requirement for APIs in medicines for the EU market to comply with ICH/Q7A. Member States are transposing the directive into their national law: about half of them have completed this process, seven more are well on their way to completion, while seven others are still in earlier stages of adoption.