Simply put, 2011 was a year of transition for bio/pharmaceutical companies, contract manufacturers, and suppliers. Financial
pressures caused by generic-drug incursion, the pressing need to augment R&D productivity and control costs, and an increasingly
global and complex supply chain are some of the key issues cited by executives participating in Pharmaceutical Technology's industry roundtable. We asked executives to share their views of the leading issues shaping the bio/pharmaceutical industry
overall and manufacturing and supply specifically. Participating in the roundtable were: Jeffrey Lee Craig, global director
of marketing and business development at ATMI, a provider of single-use bioprocessing systems; Karen Zak, vice-president of
marketing, pharmaceuticals, at the excipient and performance materials company Avantor Performance Materials; Guy Villax,
CEO of the CMO Hovione ; Michael Kleinrock, research director at the IMS Institute for Healthcare Informatics; and John Kelly,
vice-president of strategy and transitioning sites for Pfizer Global Supply (see Figure 1).
Figure 1: From left, Jeffrey Lee Craig, global director of marketing and business development at ATMI; Karen Zak, vice-president
of marketing, pharmaceuticals, at Avantor Performance Materials; Guy Villax, CEO of Hovione; Michael Kleinrock, research director
at the IMS Institute for Healthcare Informatics; and John Kelly, vice-president of strategy and transitioning sites for Pfizer
Overall industry trends
Reviewing 2011, what would you identify as the most significant issues shaping the bio/pharmaceutical industry?
Key products continued to lose patent exclusivity. Research pipelines have become more robust as new medicines to treat unmet
medical needs are developed and approved. Emerging-market demand continued to redefine geographic boundaries and increased
the complexity of global supply chains. These significant factors will continue to inform the industry's transition away from
the blockbuster model and toward developing smaller volume, specialty products.
IMAGE: DON FARRALL / GETTY IMAGES
One of the most significant issues, by far, is the policy-driven actions that imposed additional costs to manufacturers or
cut prices on medicines. These were largely motivated by fiscal and debt issues and impacted markets across the world.
Second is the unprecedented number of patent expirations that took place in 2011, which are driving the growth of generic
drugs. We [IMS Institute for Healthcare Informatics] expect to see future spending on generic drugs coming from increased
competition and incentives as patents on innovative products expire. The US will see the largest expansion of generic-drug
spending compared with other global developed markets. US generic-drug spending is anticipated to be 7–8% through 2015.
The increased speed and severity of regulatory activity reached a crescendo in 2011—Warning Letters, import alerts, recalls,
and consent decrees. Some of it was clear evidence of global medicine agencies acting to recover control over the generic-drug
industry whose lightning-speed development and globalization has caught regulators off guard. Take for example, an EU inspectorate
report leading to a FDA Warning Letter.
The intensity of outsourcing by innovator-drug companies also is a significant trend, and here the most notable stories are
in line with regulatory actions: a string of Warning Letters hitting Big Pharma because of their Indian-based supply chains.
As one industry executive noted at a recent conference, 'A firm can have all the SOPs [standard operating procedures], systems,
and controls required, but without [a] quality culture, product quality and business continuity are not assured.' Expect customers
to be looking for evidence of a true quality culture across the organization and at every level.
During 2011, the pharmaceutical industry has shown a renewed emphasis on all aspects of security and overall quality throughout
an increasingly more complex supply chain. Global supply-chain security initiatives are critical tools to prevent what has
become an abundance of counterfeit pharmaceutical raw materials and therapeutics found in both developed and emerging markets.
They also play an important part in addressing concerns about potential adulteration for economic gain, contamination, theft,
and lack of appropriate regulatory compliance. With patient safety as the public's fundamental expectation of the industry,
pharmaceutical companies have made supply-chain security a primary responsibility that applies across the organizational boundaries
of procurement, manufacturing, packaging, and regulatory compliance. Collaboration within the industry across suppliers and
manufacturers allows for the determination, sharing, and implementation of best practices that will continue to enhance supply-chain
security and build patient confidence.
In 2011, we noticed a continued push toward gains in manufacturing efficiency. In recent years, manufacturers have qualified
and validated single-use technologies to accelerate milestones and address productivity demands. Currently, we are focused
on scaling manufacturing processes and optimizing supply-chain infrastructure. Right now, single-use technologies are in the
early stages of industrialization. The cycle of innovation is ongoing even as single-use products and systems are being integrated
for more efficient manufacturing platforms. Many positive steps were made in 2011 to help solve efficiency challenges. Ultimately,
a new approach to manufacturing will be realized through these new technologies.