Articles

Issue PDF

Applying QbD Principles to Drug Substance Development and Manufacture : Inside ICHQ11

Pharmaceutical Technology, February 2012 Issue (PDF)

The Department of Justice celebrated the end of 2011 by announcing billions of dollars in recoveries from False Claims Act cases, most of it from pharmaceutical companies. Of the more than $3 billion in settlements collected during the fiscal year that ended Sept. 30, 2011, nearly $2.2 billion came from pharma. At the top of the list was the $750 million paid by GlaxoSmithKline (GSK) to settle charges involving adulterated drugs and failure to meet strength, purity, or quality requirements at its Puerto Rico facility, evidently the first FCA settlement involving GMP violations reported by a whistleblower.   

These civil fraud cases represent only the tip of the iceberg in pharmaceutical industry compliance battles. The Justice Department also collected $1.3 billion in criminal fines and forfeitures for violations of FDA regulations. Some of that money may come from GSK, which also is negotiating with the feds to settle several investigations into marketing and pricing practices. Amgen agreed to pay $780 million in October 2011, related to promotion of its anemia drug Aranesp (darbepoetin). Merck recently announced a $1-billion settlement to resolve allegations about Vioxx (rofecoxib) marketing. And in January 2012, Johnson & Johnson said it would pay more than $1 billion to resolve state and federal  lawsuits involving off-label marketing of its antipsychotic Risperdal (risperdone).   

While most of the high-profile cases involve illegal marketing and pricing allegations, the government is also stepping up enforcement actions for failure to meet quality standards. In addition to the GSK Puerto Rican case, Indian drugmaker Ranbaxy Laboratories signed a consent decree with FDA in December, and agreed to pay up to $500 million to settle a three-year investigation into falsifying records and GMP violations, which shut down imports into the US. 

"We demand accountability when companies' failures in drug manufacturing lead to products that materially differ from the strength, purity, or quality of what was required," stated Department of Justice Assistant Attorney General Tony West at the Pharmaceutical Regulatory and Compliance Congress in November 2011. He noted that the Obama administration's broader campaign against healthcare fraud, which was strengthened by the Affordable Care Act (ACA), has led to more than $8 billion in settlements, penalties, and fines since 2009.  

West also emphasized the government's intent to prosecute individual industry executives, under the controversial Park legal doctrine, a policy that can hold corporate officers liable for company violations of FDA and other federal laws. Another enforcement strategy is to "exclude" company executives from doing business with government health programs such as Medicare and Medicaid, which basically prevents the targeted officer from holding any responsible drug industry position. Taking action against individual executives aims "to promote a culture of compliance by emphasizing deterrence," said West. The goverment wants to dispel the notion among manufacturers, he explained, that dealing with enforcement is "simply the cost of doing business." Instead, the government will levy judgments and penalties that "eliminate any benefit that may be obtained from engaging in unlawful conduct in the first place." 

West and others similarly urge medical-products companies to establish effective safeguards against economic fraud, negligent production, and theft. He acknowledged that the government will never have enough resources to tackle every fraud and abuse case or to inspect every drug-production facility, especially the growing number of foreign operators that ship medical products to the US.  

FDA officials agree. At the December enforcement conference sponsored by the Food and Drug Law Institute (FDLI), Howard Sklamberg, FDA deputy associate commissioner for regulatory affairs, pointed out that the agency can do only so much to monitor companies and enforce FDA rules, and that regulated firms must invest in quality systems to prevent violations internally and by suppliers and contractors. The role of the Office of Regulatory Affairs (ORA), Sklamberg explained, is to "help industry be responsible" through the development of standards and best practices. 

This approach also calls for direct compliance oversight by corporate leaders, as illustrated by a November 2011 Warning Letter sent to Novartis CEO Joe Jimenez. The letter requested Jimenenez' personal involvement in addressing a long list of violations at facilities in North Carolina and Colorado, many uncorrected from previous citations. Jimenez promised company employees that "neither costs, nor service level will interfere" in the company's remediation plan; Novartis subsequently suspended production at another plant in Nebraska and recalled several products, a sign that the firm's manufacturing issues may be more widespread. 

An increase in FDA Warning Letters and inspections, particularly to foreign facilities and to contract manufacturers, responds, in part, to continued criticism of FDA oversight of foreign manufacturers. The Government Accountability Office (GAO) complained in a September 2010 report that the agency still lagged in oversight of foreign facilities and needs better data on overseas facilities producing drugs for the US market.  

ORA is addressing these issues by ramping up inspections and establishing a searchable public database of inspection reports, including conditions cited in FDA 483 reports and summary data by fiscal year. The field force is trying to be more efficient, replacing infamous inspector green notebooks  with handheld computer devices to record findings during site visits. Foreign producers of APIs, such as China's Sichuan Pharmaceuticals, have received Warning Letters,  and India's Synbiotics was blasted for denying access to an FDA investigator. Some manufacturers have been hit with even more stringent enforcement actions, such as bans on certain imports from Dr. Reddy's Mexican facility and from Yag-Mag Labs of India.  

Inspections of API producers and generic-drug manufacturerss are slated to increase further under the proposed generic-drug user-fee program. The five-year goal is to conduct  biennial GMP inspections of foreign manufacturers and,  in the process, provide parity in oversight for domestic and foreign firms. If Congress approves the Generic Drug User Fee Act (GDUFA) this year, as expected, most of the estimated $300 million annual GDUFA revenues will come from manufacturing sites—14% from API manufacturers, and 56% from facilities producing finished dosage forms—and the rest from application fees. Preapproval inspections will continue as required by new applications, but may not be necessary for recently inspected sites with good compliance histories.  

The generic-drug user-fee program also calls for FDA to use inspection information and reports from foreign regulatory authorities where appropriate, an approach championed by Sklamberg and others as a way to extend FDA's oversight capabilities. Several collaborative programs have been tested, and more are being implemented.  

In December 2011, FDA and EMA announced a new GMP inspection initiative that calls for sharing information on drug-manufacturing inspections in their respective regions  Under this program, which began last month, FDA will defer or waive routine GMP inspections of European facilities previously inspected by central or nationally authorized inspectorates, and EU member states will conduct fewer inspections in the US. While preapproval inspections will continue as needed, repeat GMP inspections may be avoided for manufacturers of less risky products, sites with few quality defects in the past, recently inspected facilities, and when there is an "urgent public health need," such as a drug shortage, that requires fast regulatory action. Both parties will keep track of the number of inspections deferred or waived and review the program after three years. Not only does the initiative aim to save resources for the regulators, but fewer inspections should reduce the compliance burden on manufacturers. 

This new collaboration follows a successful joint inspection program for APIs, which involves FDA, EMA, and Australia's Therapeutic Goods Administration, along with specific EU member states. Launched as a pilot program in 2008, the initiative prevented many duplicate inspections of facilities and established a master list of API supply facilities, as outlined in a report issued in May 2011. Inspectors from the three regions shared information on more than 100 facility inspections, which helped identify weaknesses in manufacturer quality management systems and requested corrective actions. In some cases where inspection reports indicated satisfactory operations, a planned inspection involving the same API could be postponed or canceled. Participants also entered information from past inspections of more than 640 sites of mutual interest into a central database, thereby providing valuable information on site location, APIs produced, date and outcome of most recent inspection, and plans for future inspections by participating authorities.  

The API pilot also involved a small number of joint inspections, which helped build confidence in each other's operations, but required considerable effort and time to organize and to evaluate. Now, the collaboration is expanding to include additional EU member states, and possibly more regions in the future. To further improve the program, participants hope to streamline management of the master list, devise a common inspection report format for joint inspections, and develop a common risk-based policy regarding re-inspection of sites located in third countries.  

FDA and EMA are looking to extend the benefits of these joint regulatory efforts to streamline the review of manufacturing data in drug applications. In March 2011, the two agencies launched a collaborative review process for quality-by-design (QbD) components of new drug applications (NDAs), marketing authorization applications (MAAs), and supplements (referred to as variations in Europe). The two agencies hope to attract sponsors filing at the same time in both regions by striving for a consistent and efficient assessment of the quality/CMC sections of applications. Drug manufacturers also stand to benefit from joint early consultations that can yield harmonized advice; each agency, however, will issue its own review or report on the submission to meet domestic legal requirements.   

This initiative builds on other FDA–EMA coordination efforts such as the joint inspection pilot for preapproval inspections for new drugs, which failed to gain strong support from the industry. In 2009, the regulators asked drug manufacturers planning simultaneous submissions in both regions to request joint preapproval inspections as a way to facilitate the application-review process. But only two joint inspections were performed, according to a report on EMA–FDA interactions issued by the agencies in June 2011. Observers note that the program was limited to drugs (not biologics), and that few companies planned simultaneous submissions. The new QbD review collaboration, which also excludes biologics, can provide joint preapproval inspections as part of the review process and appears to be attracting more interest from manufacturers.  

Another forum for promoting collaboration and harmonization of drug inspection practices and GMP standards is the Pharmaceutical Inspection Cooperation Scheme (PIC/S), which FDA formally joined in January 2011, after a five-year vetting process. Founded in 1970 by 10 European countries, PIC/S now has 40 members around the world, with Slovenia being the latest addition. Japan and South Korea have applied for admission; the Philippines, Indonesia, Taiwan, Iran, and New Zealand are moving forward in the application process; and China and India are planning to apply.  

Previously a sideline observer, FDA now can play an active role in PIC/S programs to train GMP inspectors, establish risk-based quality standards, and share "rapid alerts" on drug safety problems, explained Brenda Holman, head of ORA strategic initiatives, at the PDA/FDA conference last September. Holman described how FDA can help develop PIC/S guides for meeting GMPs for drugs, APIs, vaccines, blood and blood products, and biotechnology-derived drugs as part of international collaborations to provide more effective market surveillance on a global scale.  

As with its members, PIC/S faces challenges in dealing with increased outsourcing by manufacturers and more complex biopharmaceutical supply chains, Holman noted. Regulators are dealing with this by teaming up for joint inspections to conserve resources as well as to build confidence in the operations of other regulatory bodies. PIC/S is encouraging inspection plans based on risk evaluation and is looking to expand into other relevant fields, such as oversight of good clinical practices and good distribution practices, the latter item reflecting growing supply-chain concerns.  

Although PIC/S policies are not legally binding, information from fellow regulators on a previous site inspection may lead FDA to forego its own site visit, and other PIC/S members can avoid duplication by relying on FDA inspection reports. FDA also can gain information on how other inspectorates rank sites for risk and compliance status, future inspection schedules, and common practices involving the scope, format, and duration of site visits.  

 Washington editor, 7715 Rocton Ave., Chevy Chase, MD 20815, tel. 301.656.4634, 

Washington Report

More collaboration and expanded oversight aim to compel manufacturers to follow GMPs.

FDA and Justice Department Address Drug Quality Concerns

Every year, industry leaders gather at the JPMorgan Global Healthcare conference to discuss key opportunities for investment during the months ahead. About 9000 people attended this year's event in January, in San Francisco.  Several key themes emerged from the presentations given by the pharmaceutical industry C-suite executives about their upcoming initiatives and focus, with the most prevalent being sustainability and innovation.  

As part of these plans, several large companies highlighted the need to reboost R&D pipelines that have diminished during the past several years. Targets include not only new products (whether innovator or generic), many in the oncology area, but also personalized medicine and biosimilars. Threaded throughout most of the presentations was the importance of emerging markets as a critical factor to success in pipeline growth and sustainability.   

While the talks did not unveil any big surprises for investors looking at pharmaceutical development and manufacturing, the conference made it clear that the same hot growth areas (e.g., biosimilars, sustainable R&D, emerging markets) that have been on chief executives' minds for the past few years are not going away. In fact, these areas are becoming more cemented into the industry's future. Below are a few highlights from the show regarding how industry is thinking—and rethinking—about these targets. 

Approaching the R&D pipeline with an eye on sustainability was a large component of the talk given by Pfizer CEO and Chairman Ian Read, who noted that the company has several products at various stages of development. And although Pfizer reduced its R&D spending in 2011 by $1 billion, Read says he has "no illusions that we need to have an engine that can produce sustainable pipeline growth." As a result, the company "stopped spending where we didn't believe we had a competitive advantage, or we believe that we would be producing me-too products." This strategy involves looking at proof-of-concepts more from a business perspective and deciding whether or not to pursue certain projects in the value chain. It sounds as though the company is being more stringent in such decisions in order to save time and money in the long run. 

Merck & Co is also expanding its thinking around scientific innovation, according to CEO and President Kenneth Frazier's talk. "Many first-in-class medicines provide high return on investment, but they also come with some of the highest risks of failure. So to succeed, we have to have a balance between first-in-class investments and risks and drugs that can be considered best-in-class. Also, we must get the full value of discoveries through effective life cycle management for products...." He mentioned, like many other speakers, biosimilars as an area of innovation and how Merck plans to compete in this space.  

Bristol-Myers Squibb (BMS) CEO Lamberto Andreotti focused on what he called the "next generation biopharma." He presented this term as a combination of the best of biotech and the best of pharma, incorporating innovation, selective integration, and continuous improvement. BMS also noted R&D sustainability with a nod towards creative partnerships as well as integration of research, development, and regulatory issues. 

Amgen President, COO, and CEO-Elect Robert Bradway (he takes over as CEO in May) spoke about pipeline plans for 2012, with a strong focus on biosimilars. "We think in order to be successful in biosimilars, a company will have to have strong biologics manufacturing, regulatory, and commercial capabilities," he said. "...We think we have that and we expect that these biosimilar molecules will enable us to grow not just in the US but in international markets as well."  

Generic-drug leader Teva Pharmaceutical Industries focused on the fast-changing world of the generics sector, describing it as a new era for the pharmaceutical industry. CFO Eyal Desheh and CEO and President of Teva-Americas William Marth pointed to the growing markets in South America, such as Chile and Peru, as well as the predictable ones in America and Western Europe. They noted as many as 40 potential product launches for Teva in 2012. 

Many more companies of diverse sizes and investment opportunities presented at the JPMorgan healthcare conference, setting off a whirlwind of investment discussions. It will be interesting to watch where funds end up in the months ahead based on the renewed push to plump up pipelines while also keeping costs and resources at a sustainable level.  

From The Editor

Pharma announces plans for the year ahead at annual JPMorgan Global Healthcare conference.

Sustainable Investment

"I thought it was merely coincidence, but the head of marketing thought it was the problem," our GMP Agent-In-Place began. "I work in a small specialized subset of the pharmaceutical industry, and I received a call from a former colleague. It turns out he had recently joined a competitor company. He had a question regarding shipment of our common raw material across the ocean. His company was missing a temperature monitor, and wondered how we would rectify such a situation. Because this was a generic regulatory question, and didn't relate to any trade secrets, I provided the information. 

"A week later, the head of our marketing organization called me regarding one of our products," chuckled our Agent. "Apparently our main competitor in this product area was no longer supplying the market and she wondered whether there was a way we could get batch approval faster for our product to prevent shortages. It turns out that the competitor was the one I talked to the previous week! I mentioned this, and my marketing colleague immediately grasped this as the reason for the competitor's apparent production issues." 

"In last month's column, I noted that we discovered that a filter could perform a secondary task," our GMP Agent-In-Place grimaced. "Guess what, we've got another one. In this case, it is a viral-removal filter. It operates by having such small holes that viruses must stay behind and let the product pass through. After we tried to change it, we found out it also removed some heavyweight polymers. The product failed release testing, so we had to perform further work on the process before we could change the filter." 

"We instituted an intensive change-control program," boasted our GMP Agent-In-Place. "We educated the staff, especially the maintenance shop staff, to run any change to a product contact material through the change-control process for evaluation. We thought things were running smoothly when the maintenance supervisor said that the production staff wanted to change a tank gasket from Teflon to silicone. When we looked into this, we discovered that the gaskets were traditionally purchased by the production staff for replacement by contractors during shutdowns, and they had already made the switch. They wanted maintenance to carry the gaskets for emergency replacements and the next shutdown. 

"After initiating a deviation for the failure to follow the proper change-control system, we performed a post implementation evaluation, including a risk analysis and extractables studies," noted our Agent. "The risk was minimal because these particular gaskets are placed above the liquid level and rarely have product contact. Any product contact is fleeting, and seen as little risk. The extractables and leachables were well within allowable limits, but they should have been checked first." 

"I've been in quality my whole career," our GMP Agent-In-Place said. "This past year, I was asked to work on a quality system for a US-based marketing organization. We have a global policy about this, so it wasn't hard to do. A year later, we were audited. Our standard agreements specify that the manufacturing sites could audit us annually, but in my 35 years they never had, until now. I really made the auditor mad when I told her that I had no intention of changing practices, and that any observation she gave me would get the answer; 'We shall continue our current practice.' As a result, she took this minor issue and cited it as a major failing, needing a higher level oversight and correction. It was funny at the time, now it's an irritation."  

monthly "Agent-in-Place" column distills true industry tales from the files of Control, a senior compliance officer. If you have a story to share, please email it to Control at 

 We won't use any names, but if we do use your experience in the column, you'll receive a Pharmaceutical Technology T-shirt. 

Agent-in Place

A nickel's worth of free advice to the competition could come at the expense of your bottom line.

Shipping with the Enemy?

Dedicated social media recommendations from FDA may not yet have materialized, but the agency is beginning to address some of the industry's questions in this area. At the end of 2011, FDA released a draft guidance titled 

Responding to Unsolicited Requests for Off-Label Information About Prescription Drugs and Medical Devices

, which includes recommendations on responding through online channels such as forums and chat rooms. 

According to the guidance, many firms encounter requests for off-label information about their products through websites, discussion boards, and other electronic forums, and FDA recognizes that firms are capable of responding to such requests in a "truthful, non-misleading, and accurate manner." Indeed, FDA acknowledges that it can be in the best interest of public health for companies to reply to these requests because other participants in the discussion may not be able to provide accurate information. 

The guidance discusses responses to both non-public information requests, such as a one-on-one email or telephone call, and public requests, such as a request on an online forum. The latter type is more complicated because firms must ensure that their response does not communicate unapproved information to those who have not asked for it.  

If a firm responds to unsolicited requests for off-label information in the manner described in the draft guidance, FDA said it will not use such responses as evidence of a firm's intent that the product be used for unapproved or cleared uses. 

PharmTech Talk

Guidance offered on how to deal with off-label information requests.

FDA's Social Media Insight

The bio/pharmaceutical industry's intensification in product development for biologic-based drugs has had an effect on the demand for supply-chain services for clinical-trial materials and commercial drugs. During the past year, several CDMOs and CMOs have expanded their cold-chain logistics, distribution, and storage capabilities. Other companies, such as third-party logistics providers, also have enhanced their capabilities to serve the pharmaceutical cold chain. These expansions are part of an overall growing market for healthcare cold-chain logistics. The total size of the healthcare cold-chain logistic services market is expected to expand from its current size of  $6.1 billion to nearly $9.5 billion by 2016, according to the IMARC Group, a research and advisory firm. 

Last May, the CDMO Almac Group opened a new $120-million North American headquarters in Souderton, Pennsylvania, which provides the company with parallel service offerings in the United States and in Europe through the company's Craigavon, Northern Ireland, site. The new 240,000-ft

  North American headquarters integrates the company's clinical technologies and clinical services activities into one location after being housed in separate locations in Audubon and Yardley, Pennsylvania. 

(IMAGE: DATACRAFT CO LTD / GETTY IMAGES) 

The facility has two interlinked buildings, the first a 74,250-ft

  building providing administrative work space for Almac Clinical Services, Almac Clinical Technologies, Almac Sciences, Almac Pharma Services, and Almac Central Services. A second 166,135-ft

  building, houses production and logistics services, including, packaging, testing, and distribution of clinical supplies. The facility has extensive storage capabilities for pharmaceutical materials, including raw materials, in-process materials, and finished goods. The facility provides a range of storage solutions, including temperature- and humidity-controlled 41,150-ft

  of warehousing (15 to 25 °C and 65% relative humidity) and refrigerated and frozen storage space. A 271,000-ft

  drive-in cold storage unit is maintained at temperatures of 2 to 8 °C, and a 6131-ft

  walk-in storage unit stores products at between–25 and –15 °C. Additional critical storage space is offered through the use of mobile units  

In March 2011, in response to increased client demand for cold and dedicated frozen storage capacity for biopharmaceuticals, Almac's Pharma Services business unit expanded its commercial facilities to include an additional 6124 ft

  of cold and frozen storage. The expansion was a joint investment with a commercial client for which Almac provides central European Union importation, warehousing, and distribution services. This space includes dedicated -70 °C, –20  °C, and 2–8 °C storage for drug antibody, drug linker, bulk drug substance, placebo, and filled vials. The company added 20 additional dedicated freezer units to its existing 10 for the storage of the monoclonal antibody and bulk drug substance products. 			

The opening of its North American headquarters in 2011 and the addition of cold-storage capacity in the EU were in addition to several other expansions in Almac's clinical-trial-materials operations. In January 2012, Almac opened a new £3-million ($4.7 million) 30,000-ft

 building at its Craigavon headquarters, which will house 150 employees from Almac's Clinical Services business. In December 2011, Almac launched a new forecasting platform, Compass, which is designed to improve the accuracy and efficiency of the supply-inventory process during clinical studies. Compass is part of Almac's Supply Chain Management services to aid in the packaging, labeling, and distribution of trial supplies on a global level. Also, in June 2011, Almac's clinical-services business unit increased its presence in the Asia-Pacific region with the addition of five new depots in Japan, Thailand, Hong Kong, and Taiwan, thereby providing the company with 36 depots in its network with another five planned for 2012.  

In August 2011, Catalent Pharma Solutions expanded its cold-chain supply and distribution capabilities in all major areas of the company's cold-chain storage and distribution, including 2–8 °C and–80  °C capabilities, in some cases more than tripling existing capacity for storage and distribution. The cold-chain expansions at Catalent's European sites in Bolton, United Kingdom, and Schorndorf, Germany, were scheduled to be completed by the end of 2011.  

Catalent also made other key moves to improve its clinical-services business. In October 2011, the company opened an European development and clinical services laboratory in Swindon, United Kingdom. This expansion followed recently expanded clinical-supply service capabilities in Schorndorf, Germany. Also, in 2011, Catalent acquired the clinical-trial supplies business of Aptuit, positioning the company as the number two provider globally in clinical-supply solutions.  

In December 2011, the logistics company UPS agreed to purchase Italy-based Pieffe Group, a pharmaceutical logistics company. The acquisition adds two major healthcare distribution facilities, one in Milan and the other in Rome, to UPS's existing global network. The facilities provide a combined space of nearly 753,500 ft

 , including 12 cold-storage areas, with options for further expansion. These facilities add to UPS's global healthcare distribution footprint of more than 4 million ft

. UPS's existing healthcare network of 30 facilities worldwide offers services, such as temperature-sensitive handling capabilities, regulatory compliance, monitoring and security, kitting and labeling, as well as order management and accounts receivables. 

In September 2011, the logistics company DHL launched DHL SmartSensor GMS, a device for temperature monitoring, as an advanced version of the company's SmartSensor RFID. The DHL SmartSensor GSM is a small, high-technology device that is packed inside the DHL shipment and which sends real-time data to the solution's web portal. The device uses GSM (Global System for Mobile Communication) technologies that permit data to be controlled without opening the shipment. The device acts as a data-gathering sensor and sends email or text-message notifications if problems arise during transport, such as a change in temperature or the premature opening up of parcel as the light sensor is activated. The device can be used for land and ocean-freight transports. For air transport, the device's GSM antenna is automatically switched off before take-off. The sensor continues to retrieve data but does not send the information in flight as to not to interfere with the aircraft's electronics, according to a Sept. 22, 2011, DHL press release.  

In November 2011, DHL Global Forwarding, the air and freight specialist within the Deutsche Post DHL Group, expanded its services for temperature-controlled shipments. The company entered into a lease with CSafe, a heat-and-cool container provider for the temperature-sensitive air-freight market. The CSafe heat-and-cool containers maintain temperature within a range of 4 °C to 25  °C by means of rechargeable batteries for temperatures ranging from ambient to more extreme temperatures of from –30  °C to 49 °C. 

In September 2011, DHL Global Forwarding and Lufthansa Cargo changed their ownership of their 50–50 joint venture, LifeConEx, a life-sciences cold-chain logistics provider, to make it a 100% owned subsidiary of DHL. In April 2011, DHL Global Forwarding opened a new competence center in Vienna to expand services to the life-sciences sector. The facility includes 500 m

  of refrigerated warehouse space for handling temperature-sensitive products to allow them to be prepped for air shipment. The center, located at the Vienna airport, is expected to transship approximately 20,000 pallets annually in temperature ranges of 2–8  °C and 15–25 °C. In addition to the warehousing service, the company offers loading and unloading of refrigerated containers, packing of products, coordination of freight space, and organization of the necessary transport equipment. DHL Freight and LTL ColdChain Europe, a pan-European road-freight pallet network for the life-sciences and healthcare industries, are connected to the Vienna competence center.  

In March 2011, Bristol-Myers Squibb selected Exel, part of DHL, to be its third-party logistics provider handling US distribution. As part of the contract, Exel purchased the existing Bristol-Myers Squibb distribution centers in Mount Vernon, Indiana. Exel is providing logistics operations and finished-goods distribution services, including storage and distribution of cold-chain and non-cold-chain products, clinical-trial materials, samples, and exports. Exel also is managing second distribution in Mechanicsburg, Pennsylvania, for Bristol-Myers Squibb. 

Movianto Nederland, a logistics and transportation company specializing in pharmaceuticals and healthcare, is building a new warehouse in Oss, the Netherland to offer a large facility for the storage of deep frozen pharmaceutical products. The new warehouse, which will be operational by April 2012, will provide a range of new facilities, such as a deep frozen storage area (< –20 °C) with a capacity for 350 pallets. The 13,000-m

  good-distribution practice (GDP)-compliant warehouse encompasses 21,000 temperature-controlled pallet places, including 17,700 in the area of ambient (15–25 °C) 2200 chilled pallet locations (2–8 °C), and 1100 pallets for narcotics. The facility includes a mezzanine with 1300 m

  for repackaging and relabeling services according to GMP guidelines. The expanded storage capacity will serve as a central European warehouse with a dedicated cross-docking area and bonded warehouse facility. Movianto's transport solution manages freight and distributes the products to local warehouses throughout Europe. 

In July 2011, Sherpa Clinical Packaging, a privately held provider of clinical-trial material-management services, opened a new cGMP production facility in San Diego, California, colocated adjacent to the CDMO Althea Technologies campus in Sorrento Valley. Sherpa and Althea entered into a comarketing agreement in March 2011. 

Sherpa's new facility includes five controlled access and monitored packaging suites, and walk-in 2–8 °C and –20 °C storage areas. Redundant refrigeration systems, alarms, and onsite emergency backup generator power were specified to minimize potential risks associated with cold storage. "We purpose-built the facility to accommodate the needs of pharmaceutical and biotech clients that require controlled environments for their clinical study materials," said Mark Paiz, president of Sherpa Clinical Packaging," in a July 2011, press release. "The site offers companies conducting clinical studies an option to label, package, store, and distribute on the West Coast, which is particularly important for many biotechnology companies whose products require cold storage." 

Marken, a provider of clinical-trial management services, reported in December 2011 that it has expanded its depot network with a new facility in Buenos Aires. The Argentina depot joins Marken's already operational depots in Mexico and Singapore and includes a full range of temperature control, including controlled ambient, cold storage (2–8 °C) and frozen (–20 °C) as well as a secured drug store. Each of Marken's depots offer specimen kit distribution, collection, storage, and management as well as reverse logistics for dosage kits, drugs, and equipment, including reconciliation and certified destruction. Additional depot facilities are being developed in Europe, Asia, and the Americas, according to the company. This expanded network builds on Marken's current Latin America business, which serves over 1200 clinical research investigator sites in the region. 

In May 2011, BioStorage Technologies, a provider a sample-management solutions, opened a new biorepository facility in Indianapolis, Indiana. The $4.6-million, 60,000-ft

  facility is dedicated to the preparation, storage, and cold-chain transport of human biological samples for academic centers, CROs, donor programs, and biotechnology companies. The facility expansion provides the company the ability to offer sample-preparation services, including automated liquid handling technology for high-throughput DNA and RNA extraction and verification. The new biorepository facility offers a wide range of storage options, including automated carousel controlled-room temperature storage at 15 °C to 27 °C, bulk sample storage at 15 °C to 27 °C, walk-in cold sample storage at –20 °C to 5 °C, ultra-low temperature storage at –70 °C to –80 °C , and –190 °C vapor-phase liquid nitrogen. 

 485 Route One South, Bldg F, First Floor, Iselin, NJ 08830 tel. 732.346.3072,  

Pharma Ingredients

As biopharmaceutical development and commercialization increases, companies are expanding their cold-chain capabilities.

Expanding Capabilities in the Pharmaceutical Cold Chain

To ensure the quality of APIs and finished drug products, impurities must be monitored carefully during process development, optimization, and process changeover. The isolation, characterization, and control of impurities in pharmaceutical substances are being reviewed with greater attention based on national regulatory and international guidelines. In Part I of this article, the authors examine the different types and sources of impurities with specific examples. 

An impure substance may be defined as a substance of interest mixed or impregnated with an extraneous or usually inferior substance. The greatest financial impact on the cost of a drug substance often is found in the final preparation process. Product yield, physical characteristics, and chemical purity are important considerations in the manufacture of the active ingredient, the formulation of the dosage form, and the manufacture of the finished drug product. Processes to control the preparation of the drug substance and drug product must be disclosed to FDA as part of a new drug application. If production batches do not meet the purity and impurity specifications required, the manufacturer must attempt to upgrade materials by rework procedures, which are costly because they consume drug substance and resources and prevent the preparation of other batches of drug substance. The sources and types of impurities can be illustrated by considering a general flow scheme for manufacturing drugs. The formation of impurities is interconnected with each stage as shown in Figure 1. 

Figure 1: Schematic representation of impurity-formation pathways for APIs and finished drug products. DMF is drug master file.  

In short, any material that can affect the purity of an API or finished drug product is considered an impurity. Impurities arise from various sources, which commonly include starting material(s), intermediates, penultimate intermediates, byproducts, transformation products, interaction products, related products, degradation products, and tautomers.  

Impurity control in starting materials used to manufacture APIs has long been expected by regulatory agencies (1). An API starting material is a raw material, intermediate, or API that is used in the production of an API and that is incorporated as a significant structural element into the API. API starting materials normally have defined chemical properties and structure (2). An FDA draft guidance, 

Drug Substance: Chemistry and Manufacturing Controls Information, 

reflects the concern that starting materials should be selected and controlled such that any potential future changes to the quality of the starting material would have an insignificant impact on the safety, identity, purity, or quality of the drug substance (3). Based upon the principles outlined in this FDA draft guidance and ICH guidelines for process understanding and control over potential adverse effects on the quality of the produced drug substance, the following framework has been offered for the selection of starting materials:    

Appropriate, discriminating methodology is used to determine the quality of the starting material.

Specifications are appropriate to ensure quality of the API.

The impact of the starting material quality on API quality is understood and controlled. 

The starting material is available commercially and is incorporated into the new drug substance as an important structural element.

The starting material is characterized, and stability is well understood. 

The starting material is a compound whose name, chemical structure, chemical and physical characteristics and properties, and impurity profile are well defined in the chemical literature (4).

Because of the starting materials' potential impact on the quality of an API, stricter requirements for a starting material arise based on the proximity in the API synthesis of the starting material to the final API. For example, fluoronitrobenzene is a key starting material for the API olanzapine. If the 2-4-difluoronitrobenzene impurity is present in the key starting material, the same will be converted under reported conditions to 8-fluoro-olanzapine, a nonpharmacopeial impurity (

method, relative retention time [rrt] 1.07). The 2,4-difluoronitrobenzene is carried forward along with the fluoronitrobenzene, resulting in analogous compounds up to the final stage.   

-[6-(4-phenylbutoxy)hexyl)] benzenemethanamine (see Figure 2) is a drug master file (DMF) starting material for the selective long-acting  -2-adrenoreceptor agonist salmeterol. The drug is used clinically as an inhaled bronchodilator for treating  asthma and chronic bronchitis (5, 6). 

Figure 2: Reaction scheme of salmeterol and impurities. EP is the European Pharmacopoeia. NaH is sodium hydride. TBAB is tetra-n-butylammonium bromide DMSO is dimethyl sulfoxide. NABH4 is sodium borohydride. Pd/C is palladium on carbon. 

In the case of salmeterol, 4-phenyl butanol reacts with 1,6-dibromohexane to give Intermediate 1, which in turn reacts with benzylamine in the presence of dimethyl sulfoxide and triethylamine to yield 

-[6-(4-phenyl butoxy)hexyl)] benzenemethanamine, a DMF starting material for salmeterol (see Figure 2). The compound 4-phenyl butanol is commercially available and prepared from benzene with succinic anhydride (7–11). If the benzene has a trace amount of toluene, the toluene is converted to 4-(4-methylphenyl)-1-butanol. The compound 4-(4-methylphenyl)-1-butanol is present in 4-phenyl butanol as a starting material impurity, which undergoes further reaction, similar to 4-phenyl butanol, to afford the methyl salmeterol impurity (see Figure 2). Similarly, the presence of 2-phenylethanol, 3-phenyl-1-hydroxypropane, and 4-phenyl-2-hydroxybutane in the 4-phenyl butanol will yield known salmeterol Impurities B, C, and E, respectively. 

Similarly, 6-hydroxy and dichloro impurities, if present in the DMF starting material of ciprofloxacin, will be converted to 

 impurity F and nonpharmacopeial impurity (chloro ciprofloxacin) at 2.1 RRT.  

Organic compounds formed during the synthesis of APIs are termed as intermediates. The compound in the synthetic chain before the production of the final desired compound is called the penultimate intermediate.  

 Developing practical synthetic routes to render high-yield products in shorter stages or in a one- or two-pot reaction generally involves formation of rearranged intermediates that ultimately give the required final product.  

As an example, the cyclization of bromonitrostyrene in the API ropinirole involves the rearrangement of the intermediate cyclic ion to give the indole ring with the formation of hydroxamic ester and chlorooxime acetate as impurities.  

 Advances in synthetic chemistry have enabled a number of stages in a reaction to be carried out in just one or two pots without the need to isolate intermediates. The downside of such reactions is the unexpected and numerous impurities that form because intermediates and reagents are not isolated. 

As an example, the alkylation of the key starting material  (

)-2-amino butyramide for the API levetiracetam with chlorobutyrylchloride using potassium hydroxide in the presence of tetra-

-butylammonium bromide gives an intermediate that eventually cyclized into levetiracetam. This intermediate, however, is present in the final product as an 

Figure 3: Linezolid (e.g., oxazolidinones class) and pemetrexed disodium tautomer impurity. EP is the European Pharmacopoeia. RRT is relative retention time. 

 Nonreactive intermediates are impurities formed in some intermediate stage by the reaction of reagents used in the next stages due to carryover. Such impurities remain nonactive in the later stages. 

For example, 4-phenyl butanol is a key raw material for the synthesis of salmeterol Intermediates 1 and 2 (see Figure 2). Intermediate 1 reacts with 4-phenyl butanol in the presence of sodium hydride and toluene to yield Compound 1, which is a nonreactive impurity in further stages. Intermediate 2 reacts with the trace amounts of Intermediate 1 and in the same conditions react to form Compound 2 (see Figure 2). 

 Reactive intermediates, as the name implies, are byproducts or impurities resulting from the intermediate stages of the reaction that have the potential to react with the reagents or catalysts used in later stages. They are carried forwarded in every stage up to the final API as a reactive intermediate. 

During the process development of salmeterol, an unknown impurity was detected at 2.08 RRT at a level of 0.11% and later identified after isolation to be Compound 3 (see Figure 2). The impurity formed in the final API due to presence of 

-benzyl-6-(4-cyclohexylbutoxy)hexan-1-amine in Intermediate 2 leads to the salmeterol cyclohexyl impurity (12).  

-benzyl-4-phenylbutan-1-amine is present in Intermediate 2 (see Figure 2). It is formed by the reaction of 4-phenyl butanol with benzyl amine and competes in all reaction stages with Intermediate 2 to form Compound 4 (see Figure 2). 

 A main challenges faced in developing the olefination route of the API aprepitant was a subsequent reaction of the vinyl ether intermediate with dimethyltitanocene to form an ethyl impurity (13). 

 The formation of new or unknown impurities can occur when scaling up a process, even with successful runs at a smaller scale. Examining the molecular weight of such impurities often reveals the compound is exactly double the weight of that being formed in that reaction step. Such dimeric derivatives are called bis-compound impurities. Two bis-compound impurities were formed in the intermediate and final stages in the synthesis of linezolid, to be discussed in Part III of this article.  

In synthetic organic chemistry, getting a single end product, 100% pure, seldom occurs because of the change into byproducts, which  can be formed through a variety of side reactions, such as incomplete reactions, overreactions, isomerization, or unwanted reactions between starting materials, intermediates, chemical reagents, or catalysts. For example, in the bulk production of paracetamol, diacetylated paracetamol may form as a byproduct (14).  

 In the Claisen rearrangement of the aryl propargyl ether in diethylaniline at elevated temperatures, formation of the desired chroman product is accompanied by the generation of a furan byproduct in success sively increasing amounts (15). 

In the ropinirole synthesis, a somewhat similar case is observed in the final step. The reaction between the ropinirole precursor 4-(2-bromoethyl)-13-dihydro-2H-indol-2-one and di-

-propyl amine in water produces ropinirole in modest yield (57%), together with styrene as the major byproduct (38%) (16).  

Figure 4. Propionaldehyde with malanonitrile reactions. CAS refers to Chemical Abstracts Service, No. is number, and NA is not available. Conditions: (a) with piperidine in pyridine, heating (Ref. 27); (b) with piperidine in pyridine, heating, cyclization (Ref. 28); (c) with piperidine, 1,4-dioxane (Ref. 29â30); (d) With [C4DABCO][BF4] in water, Time = 0.0166667 h, T = 20 Â°C, Knoevenagel condensation or with aluminum oxide in dichloromethane, T= 20 Â°C, Knoevenagel condensation aldol-condensation (Ref. 31â33).; and with morpholine in ethanol, T = 20 Â°C, Knoevenagel condensation (Ref. 34â37).

In another example, thiophenes are important heterocyclic compounds that are widely used as building blocks in many agrochemicals and pharmaceuticals (17). The synthesis of 2-amino-5-methylthiopene-3-carbonitrile is achieved by reacting a mixture of sulfur, propionaldehyde, malononitrile, and dimethylformamide using triethylamine (18–26). 

The reaction of propionaldehyde with malononitrile and sulfur resulted in formation of two unknown impurities up to 7%, which were isolated and confirmed by 

 H NMR (nuclear magentic resonance spectroscopy), correlation spectroscopy, nuclear Overhauser effect spectroscopy,  and single X-ray crystallography to be Impurity 1 (see Figures 4 and 5). These impurities are further found to react with 2-fluoro nitrobenzene to give next-stage impurities and which are controlled by purification in the respective stages. 

Impurity 1 (see Figure 5) is a novel tricarbonitrile bicyclic compound, and as of the writing of this article, it is not known in the literature. Prediction of cLogP is 0.65, drug linkness is 4.04, and the drug score is 0.45 as determined by OSIRIS Property Explorer, software used to calculate various drug-relevant properties of chemical structures. Structure–activity relationship, quantitative structure–activity relationship, and drug design with other modified organic/inorganic hetrocyclic moieties could give some biological activity. The molecular designing of Impurity 1 for specific and unspecific purposes (e.g., DNA-binding, enzyme inhibition, anticancer efficacy) is based on the knowledge of molecular properties, such as the activity of functional groups, molecular geometry, and electronic structure, and on information cataloged on analogous molecules. The compound 2,6-diamino-7-ethyl-8-methylbicyclo[2.2.2]octa-2,5-diene-1,3,5-tricarbonitrile could be coupled with an active or nonactive peptide to check the biological activity as a prodrug or drug. The potential therapeutic and prophylactic activities of antimalarials, antimitotics, and antitumor agents could also be performed. This bicyclic compound may be used alone as a single agent or in combination with any organic or inorganic salts in chemotherapy or in combination with other chemotherapeutic agents after 

Figure 5: Reaction scheme of olanzapine impurities. DMF is dimethylformamide. TEA is triethylamine. Addn is addition. RT is room temperature. CAS is Chemical Abstracts Service, No. is number, and NA is not available.  

Transformation products deal with theorized and nontheorized products produced in a reaction. They can be synthetic derivatives of byproducts and are closely related to byproducts. 

A reaction where transformation products occur is the formation of chloro acetyl derivative of salicylaldehyde during the acylation reaction of salicylaldehyde with bromo acetyl bromide using methylenedichloride (MDC) and aluminum chloride (AlCl

). Mechanistically, the formation of chloroacetyl derivative using bromoacetyl bromide could not be expected, but hypothetically, it could occur as a transformation reaction due to halogen exchange. During Friedel–Craft acylation with Lewis acid AlCl

 in methylene dichloride, the Lewis acid forms an ionized complex [Cl–AlCl

–Br]–, which eventually undergoes halogen exchange with the bromo acylium ion to yield the chloro acetyl derivative. Formation of this impurity in reaction is as high as 7–20%, which is an uncontrolled impurity in the manufacturing process. Nevertheless, this impurity would not affect the purity of  the final drug substance because the reaction of the transformed impurity with 2 (see Figure 6, Part I) forms the desired product, salmeterol. The presence of the chloro impurity also has been confirmed by experiment (see Figure 6, Part II). 

Figure 6: Chloro impurity-formation scheme of salmeterol. HPLC is high-performance liquid chromatography. MDC is methylenedichloride; AlCl3 is aluminum chloride.  

 deals with the interaction of two or more intermediates/compounds with various chemicals, intentionally or unintentionally. An interaction product is slightly more comprehensive than byproducts and transformation products. Two types of interaction products that are commonly encountered are drug substance–excipient interactions and drug substance–container/closure interactions. 

 means that the impurity has similar structure as that of the drug substance and may exhibit similar biological activity. This structural similarity by itself, however, does not provide any guarantee of similar activity. An example of a related product is 8-fluoro olanzapine. 

Peer-Reviewed Research

In Part I of a three-part article, the authors discuss what constitutes an impurity and the potential sources of impurities in APIs and finished drug products.

Evaluating Impurities in Drugs (Part I of III)

Textbooks and journal articles treat common cause variation as if it is an inevitable fact of nature and beyond our control: "In any production process, regardless of how well-designed or carefully maintained it is, a certain amount of 

will always exist. This natural variability or 'background noise' is the cumulative effect of many small, essentially 

 causes" [Emphasis added] (1). This attitude cuts off thoughts of trying to reduce variation. But, with some reflection, there are several ideas and techniques that can begin to help reduce common cause variation. 

Aiming for and hitting the target, whether it is x, y or z, seems a simple idea, but it could be argued that it is everybody's responsibility to know what the target is and to do everything possible to hit that target every time. One person achieving the target infrequently doesn't help. But 400 people hitting targets a dozen times a day can have a dramatic effect on reducing variability. The target could be something as simple as setting the temperature on a dryer or as complex as a management objective. Keep in mind that a specification range is not a playground for manufacturing. 

This mindset also can influence how specifications criteria are written. It is common to write the criteria as "(Low, High)."  I suggest that criteria are better written as, "Target (Low, High)." The first thing the operator sees is the target value;  people generally try to achieve the first thing they see. Second, the low and high criteria limits are given, which eliminates the need to mentally calculate those limits (e.g., if Target ±Δ, was used instead). The limits need not be symmetrical with the target value. 

The terms sound contradictory but do contain logic. Many activities are at the liberty of the operator or analyst and, as such, are subject to considerable leeway in how they are performed. In these situations, particularly in the analytical laboratory, one strives to get everybody on the team to do exactly the same thing, the same way, every time. If then, at some point in the future someone proposes a new or better way to perform the task, the whole team changes to follow the new process. This group consistency can have a substantial impact on variation within a department. Notably, creativity of the individual is not stifled, but rather channeled to find better ways to perform a task. 

"An operational definition describes what something is and how it is measured" (2). For example, "sample the batch" could mean: "Using the 72 in. thief, open the port on the right side labeled P8, and take a sample from the top two inches, a sample from the middle, and a sample two inches from the bottom. Composite the three samples into a clean glass jar with a lid, and label with the date, time, name, product, lot and vat number." Operational definitions reduce variation by promoting consistency. Standard operating procedures are a form of operational definitions. 

Made famous by the Japanese auto makers, 

 is simple but powerful in reducing variation, deviations, and discrepancies. The goal is to make activities as mistake-proof as possible by physical means or by procedures that are difficult to do incorrectly. The classical physical example is to put a mechanical stop on a drill press to prevent the drillbit from making a hole that is too deep. In a paperwork process, colored pages are used to clearly identify certain documents.  

Although controlling what can be controlled may appear to be an obvious idea, many factors are commonly ignored during normal operations. Perceived to be noncritical process parameters, they are left to float within some specified range. However, variables should be controlled to the fullest extent with the highest accuracy possible without incurring great expense or requiring great effort. Again, controlling only one factor will have a trivial impact, but a culture of controlling hundreds will reduce common cause variation. The tools discussed in this article require support from management, but it is that support that makes implementation so powerful. 

 is a statistician at PharmStat Consulting, 2000 Dempster, Evanston, IL 60202, tel. 847.424.1314, 

 1.  D.C. Montgomery and G. C. Runger, Applied Statistics and Probability for Engineers (Wiley, New York, NY, 1994), p. 834. 

 2.  P. R. Scholtes, The Team Handbook (Joiner Associates, Madison WI, 1988), p. 2–28. 

Statistical Solutions

Where is the variability coming from and what have we done to minimize it?

Reducing Common Cause Variation

The biopharmaceutical industry is starting 2012 with good reason for optimism. Based on preliminary results from BioPlan Associates' 9th Annual Report and Survey of Biomanufacturing, biologics manufacturers and their vendors are spending more, demanding better technologies, and expressing greater optimism than at any time in the nine years we have been assessing this industry. This year the BioPlan study finds substantial optimism, with a 37.3% of suppliers indicating that their company did either "better" or "much better" than expected in 2011. Even more relevant, 49.4% expect they will do "better" or "much better" in 2012.  

Sales growth among vendors is a leading indicator of the overall performance of the bio/pharmaceutical industry because vendor sales are derived from demand for materials biologics production. If vendors are doing welll and are optimistic for the future, the bio/pharmaceutical industry is likely to follow. Supplier respondents indicated that, on average, sales growth is currently at approximately 14% annually, up from 13.0% in 2010 and 14.1% in 2007.  

Budgets also are a good indicator of industry strength, and budget estimates for 2012 are up strongly in areas such as acquisition of new technologies, capital equipment, and personnel training and development. Early results from the 2012 BioPlan survey projects increases in all 12 areas, except for outsourcing (see Figure 1).  

Figure 1: Average change in biomanufacturers' budgets (2009â2012). (Figure 1 is courtesy of the author) 

These overall trends are in large part resulting from global shifts that continue to drive the bio/pharmaceutical industry. Below are trends we project in 2012 specifically relating to biomanufacturing.  

 The bio/pharmaceutical industry continues to expand globally, driven by the need for prudent expansion of infrastructure, presence in new markets,  and cost savings through outsourcing and offshoring, including R&D, which is traditionally performed in established high-technology regional clusters.  

Biomanufacturing capacity also is increasing outside established markets. Although the US and Western Europe remain the leaders in biopharmaceutical manufacturing capacity, more than 37% of bioreactor capacity is operating in other parts of the world, including nearly 10% in Japan and the Pacific Rim, 9% in China, and more than 8% in India (2). Western product developers also are joining with local companies, such as in the local manufacture of vaccines. As more biopharmaceutical manufacturing is performed worldwide, product developers are working to standardize their products and manufacturing processes, which involves simplifying their manufacturing processes, so they can be reliably performed with consistent product produced even in facilities in lesser developed counties.   

 The trend toward more global standardized manufacturing is contributing to the adoption of single-use/disposable bioprocessing equipment, which allow the same manufacturing systems to be shipped and installed at multiple facilities. Some companies, with major vaccine manufacturers among the leaders, are starting to think more in terms of selling full manufacturing and technology packages, including all needed equipment and technology transfer, not just finished end-products, to foreign countries that are seeking local manufacture of vaccines for domestic distribution. Companies, such as GE and Biologics Modular, for example, are developing fully modular, drop-in-place-type, and equipment preinstalled or simply installed single-use bioprocessing-based facilities to address the interest for prepackaged biopharmaceutical manufacturing facilities.  

 In 2011, single-use/disposable bioprocessing systems further increased their dominance for the manufacture of biopharmaceuticals for preclinical R&D and clinical testing.  Single-use systems dominate noncommercial-scale biopharmaceutical manufacturing in most regions. Single-use systems are increasingly being adopted for upstream manufacturing, such as adoption of single-use bioreactors and other upstream equipment. Despite dominance within precommercialization manufacturing segments, single-use systems remain a relatively small market compared with fixed stainless-steel equipment, capturing only approximately 10% of the overall bioreactor market. Stainless steel remains the preference for commercial GMP manufacturing. In as short as 10 years (approximately about how long it takes a biopharmaceutical to reach the market), half or even more of new commercial biopharmaceutical manufacturing systems can be expected to be largely or fully single-use based. 

 Most industry attention in recent years, including blockbuster products and manufacturing technology development, has concentrated on recombinant proteins produced by mammalian cell culture. Mammalian cell-culture capacity and facilities continue to dominate worldwide biopharmaceutical manufacturing (2). Microbial manufacturing remains relatively stable with few new technologies, and few major bioprocessing equipment developers announcing novel devices. A confluence of trends, however, is contributing to increased use of microbial (i.e., bacteria, yeasts, and other fungi) host cells for recombinant-protein manufacture.   

 Companies of all sizes worldwide continue to increase their outsourcing, particularly R&D and manufacturing. These activities include increasing the use of CROs, particularly for high-throughput screening, lead identification, toxicological studies as well as greater use of CMOs for commercial manufacturing. Based on the BioPlan annual survey that evaluates 24 outsourced activities, the primary outsourced activities include product-characterization testing, with 70% of biopharmaceutical companies outsourcing at least some of this activity. Other tasks routinely outsourced include validation services (69% of biomanufacturers cited), toxicity testing (65%), analytical testing/bioassays (61.1%), and fill–finish operations (60.0%). Relatively few companies have outsourced all of their manufacturing, but nearly one-half of surveyed manufacturers expect to increase their budgets for biopharmaceutical CMO outsourcing.  

These trends are, in large part, resulting from global shifts that continue to drive the bio/pharmaceutical industry. Below are broad industry trends we project in 2012.   

 The worldwide market for biopharmaceuticals continues to expand and at a more rapid rate than for pharmaceuticals in general. The world market for biopharmaceuticals is approximately $140 billion, with approximately $100 billion involving recombinant proteins and antibodies (2). The market includes over 430 biopharmaceuticals, including over 300 recombinant proteins and antibodies that are approved in the US and/or Europe. The biopharmaceutical market has been and is expected to continue to grow about 15–18% annually, well above overall economic growth rates. This steady overall growth rate is driving much current investment in biopharmaceutical R&D. 

 Despite increasing biopharmaceutical sales, the number and rate of biopharmaceutical approvals in the US has been relatively poor in the past few years (12 biopharmaceuticals entered the US market in 2011). The 2011 approvals were even fewer in number than the relatively poor results in 2010 and 2009 (4). This weak showing for biopharmaceuticals is in contrast with FDA reporting in November 2011 near record overall pharmaceutical approvals. The 2011 FDA biopharmaceutical approvals are listed in Table 1. 

Table I: FDA full biopharmaceutical approvals in 2011.** 

Approval-related innovation and progress.

 The good news, particularly for patients and the healthcare system, is that 2011 FDA biopharmaceutical approvals involved genuine innovation and advances, with nearly all products being approved for either new indications for which no treatments were previously available or for indications for which the last product approval was granted well over a decade ago.  A record number (i.e., eight) products were approved with orphan designation. Recombinant antibodies are a leading area for biopharmaceutical development. The large number of recombinant monoclonal antibody and recombinat monoclonal antibody-like products that many companies are relying on for future products may finally be starting to enter the market.  

 Largely due to the limited markets for these orphan and other approved products, 2011 US approvals will not have as much industry economic impact as is likely needed in the long-term. Only two of the twelve approvals are expected to eventually reach blockbuster sales levels of $1 billion or more per year.  

 Illustrating the trend towards internationalization of manufacturing, a record number of four, or 33%, of newly-approved US biopharmaceuticals are manufactured outside the US—in the United Kingdom. Germany, Mexico, and Italy. These products include the first product manufactured in Latin America that received FDA approval—a scorpion venom antitoxin (equine immunoglobulin F(ab) fragments), Anascorp, manufactured by a Mexican company.   

 With patents expiring for most established, successful, biopharmaceutical products, development of biosimilars is accelerating worldwide and will change the industry landscape. This emergence of biosimilars will likely involve the entrance of many new manufacturers. Most of this activity is targeted to introducing these products in the US and European markets, but many products are being developed by foreign companies, if only initially, for marketing in lesser-regulated domestic and international markets. There will likely be multiple biosimilars (as well as biobetters and biogenerics) for each currently successful biopharmaceutical. As a result, the number of biopharmaceuticals in the market and the number of biopharmaceutical manufacturing facilities will rapidly increase, perhaps doubling in the next five years.  

Many biosimilar/biobetter/biogeneric developers are adopting state-of-the-art expression systems and other manufacturing platforms. Biosimilars are competing with products being manufactured using 20-year-old technology. Although biosimilar manufacturers will have technical advantages with newer technology, drug innovators of the the now biosimilars will have long off paid off manufacturing facilities. As a result, biosimilar/biobetter/biogeneric developers will have to compete on the basis of price and adopt aggressive cost-cutting technologies to effectively compete with the original biologic and other biosimilar manufacturers. Although over a dozen biosimilars have received European Union (EU) approval, no biologics have yet been approved as biosimilars by FDA. BioPlan analysis shows that biosimilar/biobetter companies are present in virtually every biotechnology-capable region, including Latin America, Korea, and other areas that have yet to be significantly involved in major Western biopharmaceutical markets (2). For example, of the nearly 400 organizations involved in biosimilars/biobetters development, more than  30 companies are based in India and 14 in China.   

 The worldwide economic downturn in recent years continues to affect the biopharmaceutical industry.  Yet, with continuing growth in its underlying sales revenue, the industry has managed to remain largely insulated from severe economic problems. Financial issues continue to affect most companies, including the major international (i.e., Big Pharma) companies that are the source for most biopharmaceutical R&D, with many having to deal with their most profitable products coming off patent. Spurred, however, by their interest in new, profitable products, biopharmaceutical R&D continues to increase. R&D invesment includes a record amount of more than $70 billion being invested by the pharmaceutical industry in R&D, about 90% sponsored by the largest international companies, with an increasing number and percentage of pharmaceuticals in the development pipeline being biopharmaceuticals versus chemically manufactured drugs). Biopharmaceuticals provide more exclusivity, market monopolization, and are increasingly attractive to the Big Pharma-type companies.  

One important trend, however, is the internationalization of R&D. Large international (i.e., Big Pharma) companies continue their expansion and/or off-shoring of R&D. Several  companies have announced major, multimillion, investments in new R&D centers in China, such as Merck Serono's $225 million, four-year commitment in Beijing.  

 The trend for industry mergers, acquisitions, and other corporate consolidation at all scales continued in 2011. This is particularly evident among large international companies that continue merging and purging (i.e., acquiring or merging companies and then downsizing the merged company). Some companies, such as Merck & Co., are moving from mergers/acquisitions in favor of more in-house and company-sponsored R&D. The continuing trend of pharmaceutical mergers, combined with off-shoring of certain jobs and facilities, has resulted in relatively high bio/pharmaceutical industry unemployment rates in the US.  

 Patent-infringement suits can be expected to increase, particularly as a large number of biosimilars (and biobetters and biogenerics) approach filing in the US and other major markets. Major test cases, such as 

Classen Immunotherapies versus Biogen Idec

, involve whether business methods patents include coverage of methods for determining the optimal dose of a therapeutic. Biopharmaceutical companies may soon need to consider yet another type of patent, in addition to those for composition-of-matter (e.g., sequences), formulations, uses, bioprocessing, and reference standards.    

The bio/pharmaceutical industry is emerging from the current global economic situation into 2012 with a positive outlook. The industry is spending more, becoming more efficient, and, perhaps most importantly, expressing great optimism. With sales growth of between 14 and 18% this year, we will likely continue to see additional spending in new technology, capital equipment, and hiring.  

 is president of BioPlan Associates, tel. 301.921.5979, 

8th Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production:  A Survey of Biotherapeutic Developers and Contract Manufacturing Organizations

Industry optimism is on the rise for 2012.

Pharmaceutical Technology-02-02-2012

Pharmaceutical Technology, February 2012 Issue (PDF)

FDA and Justice Department Address Drug Quality Concerns

Sustainable Investment

Shipping with the Enemy?

FDA's Social Media Insight

Expanding Capabilities in the Pharmaceutical Cold Chain

Evaluating Impurities in Drugs (Part I of III)

Reducing Common Cause Variation

Biomanufacturing Outlook

Formulation Development Forum: Boronate Cross-linked Micelles

Saving the Next Generation of Regulatory Scientists

Report from India

In the Spotlight February 2012

Single-Use High Capacity Membrane Chromatography

An Enhanced Approach to Drug-Substance Development and Manufacture

Inside ICH: ICH Implementation Support

Optimizing Adjuvant Filtration: A Technical Forum