Measuring Spending Levels - Pharmaceutical Technology

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Measuring Spending Levels
Pharmaceutical Technology's annual survey on equipment and machinery reveals the spending levels and type of spending made in 2010 and planned for 2011.


Pharmaceutical Technology
Volume 35, Issue 3, pp. 50-62

Impact factors


Figure 4: Level of impact of factors influencing decisions about the type of machinery and equipment purchased or the size of purchases for purchases made in 2010.
2010 results . The survey also examined the factors that influenced the type and size of the purchase. The two most influential factors for spending in 2010 were overall economic conditions (40.4% of respondents cited this as a high-impact factor) and compliance with GMPs (48.3% of respondents reported this as a high-impact factor) (see Figure 4). The influence of macroeconomic conditions on purchasing decisions was largely the same in 2010 as it was in 2009; 41.4% cited overall economic conditions as a high-impact factor in 2009 compared with the 40.4% that did in 2010 (1). Overall economic conditions was the one factor that seemed to have the greatest effect, as only 4.6% of respondents said that macroeconomic conditions had no impact (see Figure 4). Also, fewer respondents in 2010 reported that GMP compliance was a high-impact factor in influencing their purchasing decisions for equipment and machinery. In 2009, 56.1% of survey respondents regarded GMP compliance as a high-impact factor compared with the 48.3% that cited it as such in 2010 (1).

As would be expected, expanding manufacturing facilities, replacing existing equipment, and adding enhancements, upgrades, or other technology also were factors that influenced purchasing decisions. Almost two-thirds of respondents (65.5%) said expanding manufacturing facilities had either a "high" or "medium" impact on their purchasing decisions in 2010. Nearly two-thirds (64.4%) said replacing existing equipment had either a "high" or "medium" impact. A similar level (63.9%) said adding enhancements, upgrades, and/or innovative technology was either of "high" or "medium" impact, and 61.4% said improving process control and automation was similarly influential in their 2010 purchasing decisions (see Figure 4).

As shown in other trends from the survey, outsourcing played a stronger role in purchasing decisions in 2010 compared with 2009. In 2010, 43.3% of respondents said that their decision to outsource to decrease capital expenditures was a high- or medium-impact factor as compared with 38.6% that said so in 2009 (1). In 2010, 15.3% said that outsourcing to reduce capital spending had "high" impact, and 28.0% said it had "medium" impact (see Figure 4).


Figure 5: Level of impact of factors influencing decisions about the type of machinery and equipment purchased or the size of purchases for purchases planned for 2011.
Although not weighing in as strongly as some other issues, newer technologies also played a role in influencing purchasing decisions in 2010. Approximately one-third of respondents regarded the following as medium-impact factors: improving security and anticounterfeiting capabilities (31.8% of respondents identified as such); application of QbD (36.2%); and application of PAT (35.6%). It is interesting to note that PAT-influenced spending was higher in 2010 compared with 2009. In 2009, one-third of respondents said that PAT had either a "high" or "medium" impact on their purchasing decisions for equipment in 2009; 11.6% said it had an "high" impact and 21.7% said it had a "medium" impact. In 2010, however, 47.0% of respondents said PAT had either a "high" or "medium" impact. (see Figure 5).

2011 planned spending. The degree of influence for those factors influencing planned expenditures for 2011 are similar to those cited in 2010, but compliance to GMPs will be somewhat less influential and macroeconomic conditions about the same, although these factors will still be the two largest elements influencing purchasing of equipment and machinery. The influence of macroeconomic conditions on purchasing decisions will be largely the same in 2011 as it was in 2010; 39.5% cited overall economic conditions as a high-impact factor for planned expenditures in 2011, compared with the 40.4% that did so in 2010 (see Figures 4 and 5). Perhaps reflective of improving conditions, 8.4% of respondents said that the overall economy had no impact on their planned purchasing decisions in 2011, almost double the 4.6% of respondents that said macroeconomic conditions had no impact in 2010 (see Figures 4 and 5). And again, fewer respondents in 2011 say their purchasing will be influenced by GMP compliance compared with 2010. Just over one-third (37.3%) of respondents said that GMP compliance is a high-impact factor in influencing their planned purchasing decisions for equipment and machinery, compared with the 48.3% that cited it as such in 2010 (see Figures 4 and 5).


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