	Single-use systems (SUS) have become established in biopharmaceutical drug development. As confidence in the technology has increased, the adoption of disposable equipment for commercial manufacturing has begun to take place. With this shift has come a dependence on suppliers that is related to production capabilities, a situation that did not previously exist. This reliance on suppliers translates to increased risk, and consequently biopharmaceutical manufacturers are focused on managing this risk and ensuring security of supply. Dual sourcing of single-use systems and components was initially proposed as the key solution. After further consideration of the issues surrounding the supply of single-use systems, however, many in the industry believe that dual sourcing presents many challenges that can often be avoided by taking alternative approaches.
	
	


	Today, single-use systems are used throughout the entire process chain from upstream to downstream and from bench scale to production scale. In the past, when drugs were manufactured in stainless steel, the manufacturer was in control of the infrastructure once its facility was in place, sourcing only critical disposable components such as filters and chromatography sorbents. Although disposable systems do provide numerous advantages, such as reduced contamination risks, shorter set-up times, and lower capital costs, biopharmaceutical manufacturers do not have that same level of control over the disposable systems as they did with traditional stainless-steel equipment because the systems and components must be purchased from a supplier, according to John Briggs, director of quality, regulatory, and compliance at ASI-Life Sciences. As a result, adds Mario Philips, vice-president of single-use technologies at Pall Life Sciences, there is a greater dependence on the single-use supplier, which increases the risk for the manufacturer and thus requires greater vendor transparency and supply-chain security.
	
	“Unlike with traditional equipment, where almost everything is physically located at the facility, single-use systems are delivered to the site from a supplier. If the user operates on a just-in-time basis with no inventory, any delay in delivery could put the manufacturing schedule at risk. Consequently, an SUS is a critical part of drug substance manufacturing, and there is a greater need to understand and secure the sourcing of these systems,” says Roman Rodriguez, global market development manager for single-use technologies with EMD Millipore. As such, it is logical to consider qualifying a back-up supplier as part of the SUS risk-management system, and dual sourcing is a response to a need for anticipating unforeseen issues and scenarios.
	
	The implementation of single-use systems in commercial manufacturing has had the additional consequence of shifting the purchasing of these systems from those in development to sourcing professionals. As a result, according to Tony White, a founding director of the BioPhorum Operations Group (BPOG), some biopharmaceutical manufacturers are now starting to consider single-use technologies as a strategic commodity and managing their purchases across their manufacturing network, which often leads to the identification of risks that were not previously perceived. “In addition,” says White, “they are realizing that they have been single-sourcing key components by default--a position they do not find very comfortable.”
	
	Past experience with SUS sourcing problems is also a driver for the increasing focus on multisourcing, according to Terry Hudson, director of process development engineering with Genentech. “At any conference with single-use as a topic, you can find a case study or conversation about a single-use component being changed with either no prior notification or inadequate notification to the end user, and in several cases that has been tied to a negative impact on production,” he explains. In addition, Hudson notes that companies are also learning that occasionally a given process may be more sensitive to a leachable or film type than other processes, and it is beneficial to have an alternative film that can be used with that process.  
	
	There are regulatory drivers as well. Regulatory authorities have had a clear and simple message with respect to single-use products, according to Ross Acucena, product strategy manager-ReadyToProcess with GE Healthcare Life Sciences, which is that their use is analogous to outsourcing crucial elements of GMP operations, such as presterilization. “The role of the supplier is therefore now more critical, and regulators expect drug manufacturers to mitigate any risk with close partnerships and thorough knowledge of their suppliers’ quality systems and supply chains,” he says. Furthermore, the increased focus on suppliers has highlighted the fact that SUS supply chains are both broad and deep because of the integration of many components into the end products. “Single-use customers recognize that it is difficult to fully control the supply chain, which presents a potential risk to their operations and subsequent supply of needed drugs to patients,” Acucena asserts. The industry response has been to increase its focus on mitigating such risk through multisourcing.  
	
	


	The ultimate goal of multisourcing is to have the ability to seamlessly transfer from one single-use product source to another without risk to patient safety, according to Acucena. “There is a strong need to characterize and understand this issue for all parties in the complex supply chains that exist within the industry. Upon investigation, it may materialize that some parties have a robust supply chain where risk is small. The converse is that unacceptably high levels of risk are detected, requiring either dual-source or multisource strategies, or even exiting a specific relationship,” he observes.
	
	In an ideal state, according to Hudson, the multisourced component would be supplied by two different companies with different supply chains to minimize the potential for a single change impacting both components. At a minimum, multisourcing needs to provide assurance that a change or disruption to one source will not also occur at the second source. Thus, risk mitigation can be achieved by using one vendor that has two plants or by using two separate vendors. “The latter option also provides some commercial leverage and tends to be the preferred approach for end users,” Philips says, “but a lack of industry standards for single-use systems makes it more difficult, if not impossible.” Not surprisingly, suppliers prefer the dual site or manufacturing redundancy concept, according to Spencer Parkinson, senior product manager for bioproduction with Thermo Fisher Scientific. “If it is truly assurance of supply that is of interest, then more than one production site addresses this need, while allowing a supplier to provide ‘best-in-class’ products,” he notes.
	
	For Rodriguez, multisourcing is the basic view, and the real issue relates to supply chain understanding, assurance, and control, as well as taking action to reduce inherent risks. “Doing so is not as easy as it seems due to supply chain complexity down to the resin suppliers and the varying approaches that can be taken. It really starts with a close interaction with SUS integrators on a whole supply chain view. An alternative supplier’s products must be assessed with the same science-based qualification process, and if different suppliers adopt slightly different approaches, the end-user must determine what is acceptable,” he says. As an example, Rodriguez points to bioburden levels, which can be tested on every single lot or using a statistical approach. Both methods may be acceptable depending on the end-user’s specifications.
	
	


	There are numerous challenges when considering true dual sourcing, and many relate to the complexity of the single-use supply chain. The SUS business is highly customized, and there are thousands of single-use components, many of which only work with other components made by the same supplier. Of course, not all those components need the same scrutiny depending on their criticality and demand, according to Rodriguez, but due to the huge number of components and suppliers, it is a complex task to track and understand the supply chain to secure and control it. As an integrator, EMD Millipore has prioritized and ranked SUSs based on criteria (i.e., criticality, volume used, lead time, reliability of the suppliers) and customer interaction.
	
	Qualification and validation are, in fact, the critical criteria that must be met to achieve dual sourcing, according to Acucena. “To achieve dual sourcing, one must have documented evidence that a change in input (product contact materials) will not affect the output (product quality, efficacy, safety), and it is ultimately through qualification and validation that such assurance is achieved,” he notes.
	
	ASI-Life Sciences is taking a close look at how to demonstrate functional equivalency of materials obtained from different suppliers. “At this point there is no standard or definition for functional equivalency, but it is necessary to define what constitutes functionally equivalent materials in order to ensure change control,” Briggs observes.

	“The challenge lies in the fact that proprietary plastics/elastomers are used by different suppliers, and thus composition alone cannot be used to determine equivalency, and other characteristics, such as the physical and chemical properties of the single-use product and its performance under process conditions must be evaluated. In addition, the ability to integrate the product into an end-user process and the quality system of the supplier must also be considered,” he comments.
	
	Standardization is frequently raised as another issue for dual sourcing of single-use systems. Philips notes that with limited standards in place, variation in SUS design continues to be significant, and it is much harder to have contingency in supply. Hudson agrees that the main challenge to dual sourcing is the current business model used by most single-use companies, which involves the development of hardware for a SUS that will only work with their single-use components. “This approach for end users is a significant impediment to deploying such systems into a GMP environment. Until companies are willing to standardize enough on their design that they fit more than one single-use assembly, including an assembly from another company, it will be difficult to achieve true dual sourcing,” says Hudson.  

	Parkinson, on the other hand, argues that standardization would lead to a halt in innovation. “Single-use products are not commodities and will not be in the foreseeable future; innovation is critical to improving the technology. While it also leads to the development of different designs and materials by each vendor, improvements would not occur otherwise” he states.
	
	The continued advancement of single-use technology adds to the complexity, however, with new products constantly introduced that require change management. “We are aiming at full process integration by adding supply chain considerations from the lead times associated with single-use items, which requires discussions with the end-user because it is an integral part of technology transfers into manufacturing operations,” Rodriguez says. “Obviously the primary action is to communicate and build a basis of understanding about the supply chain itself and the potential associated risks, which naturally leads to actions to minimize those risks at every level of the supply chain, starting with the single-use integrator. Focusing on the product attributes, quality, and specifications may not be enough, however, as there are other steps involved such as sterilization and transportation (sometimes international) that may impact the product and lead time. Ultimately, therefore, the first challenge is to get a clear understanding of the supply chain, to communicate about it, and then establish an action plan on a case-by-case basis,” he continues.
	
	Thoroughly understanding the supply chain is, however, an intense endeavor that requires significant resources, according to Acucena. He in particular points to the case where two SUS suppliers purchase equipment from the same precursor company, and thus qualifying the two SUS suppliers does not achieve dual sourcing. He also notes that there are significant costs associated with qualifying dual-source suppliers, and the value of such an investment is an important consideration. “In essence,” says Acucena, “dual-sourcing or multisourcing can be likened to an ‘insurance policy’ that is relatively expensive to buy.”
	
	


	While the initial reaction of many biopharmaceutical manufacturers to concerns over single-use supply chain security was to look at dual-sourcing solutions, the focus has since shifted to the broader issue of security of supply and how best to manage it, according to Acucena. “The need is security of supply,” agrees Kevin Ott, executive director of the Bio-Process Systems Alliance (BPSA). He adds that dual sourcing is one possible solution, but there are others with fewer validation challenges, including redundant supply sources from a single vendor and inventory plans, for example. “The question,” he continues, “also becomes complicated by how far back in the supply chain one needs to go. That depends on volume versus demand, structure of the supply chain, etc.”
	
	For example, Ott notes that suppliers of biocontainers that can assemble containers in two locations and carry sufficient inventory of finished units and film to cover film supply disruptions do not necessarily need to be dual sourced to ensure continuity of supply, just perhaps be “dual located.”
	
	“The justification for dual sourcing should depend on the risk and the level of simplicity, and single sourcing is in many cases appropriate as long as the relationship between the supplier and the end user is a partnership,” asserts White. He notes that many automotive manufacturers only single source strategically important materials because the investment in establishing a reliable supplier is significant and not worth doubling.
	
	One alternative to dual sourcing is, according to Philips, to limit the number of contact materials in single-use systems and aim to create interchangeability for any layer (e.g., films, filters, valves, and tubes) that comes in contact with a drug product. Pall Life Sciences has taken a step forward in this direction by vertically integrating its own production processes one step back in the supply chain. The company uses its own in-house extruded film to make the supply chain more robust and is working to mitigate any potential changes from resin suppliers. “While we can’t prevent change, we are prepared to manage that change, and if we fully understand our supply chain, we have the power to support customers through any change that may occur through our supply strategy, which adds up to an increased ability to offer a greater level of supply-chain security and continuity to users,” remarks Philips.
	
	Business continuity planning and inventory management are additional mechanisms for reducing risk, according to Acucena. He notes that suppliers are now engaged in an increased focus on these aspects, and thus the crucial first step of increasing industry awareness is already taking place. He also notes that the experience with reducing the risk associated with the single-sourcing of critical chromatography media, such as protein A, can be translated to single-use systems. “GE Healthcare sought to satisfy the industry’s need to mitigate this risk through a strong focus on business continuity planning (in accordance with ISO 22301 and achieving conformance to this standard), including qualifying dual sources for critical raw materials and a significant investment in safety stock. These efforts have delivered supply-chain security improvements that should help to eliminate end-user dual sourcing. Similar approaches should be applicable to single-use technology,” he explains.
	
	Both White and Ott also note that focusing on dual sourcing at this stage in the industry’s development may not be appropriate. “Many biopharmaceutical manufacturers are not yet in a good position to dual source, as they are just starting to understand the extent of their complete single-use portfolios across their networks,” White says. Ott adds that it may be premature or counterproductive to imagine risks. “It is better to actually study, evaluate, and understand your own supply chain and the real risks. Once that is done, the need to establish truly independent dual sources and the difficulty that such an approach represents with respect to validation and regulatory filing begins to look like much less of an issue than might be imagined,” he comments.
	
	


	Supply-chain security is a top challenge for both BPSA and BPOG moving forward into 2015. The Parenteral Drug Association (PDA) is also working on concepts to facilitate multisourcing. While these initiatives are important, Philips would prefer to see vendors, users, and regulators working together to bring one set of standards forward, rather than multiple associations working on multiple standards. “The biopharmaceutical industry is still a relatively immature industry, and substantial changes can be expected over the coming decade. Standardization is going to be a key element of true multisourcing, and having one body regulating the industry will make supply chains more transparent and keep user expectations realistic,” he says.
	
	Many of the industry-wide initiatives already underway to provide standardization and guidance on change notification, leachable/extractable testing, and other end-user needs for increased adoption of single-use systems, and particularly for components and systems that already allow some interchangeability such as buffer bags and tubing connectors, will help speed up multisourcing, according to Hudson. On the other hand, where the supplier’s business model is to design a system that only works with its components, education is the key. “Genentech recently presented a proof-of-concept design for a single-use bioreactor that could work with top- and bottom-mounted bags from two different suppliers. The next step is convincing management at suppliers that designs such as this one will lead to higher future sales because they help open the doors to more GMP applications and greater adoption of single-use technology in general,” he states. Genentech is also partnering with several single-use supplier companies to gain greater visibility into their supply chains, to provide recommendations on what it considers “multisourced”, and to communicate what applications of single-use simply will not occur until they can be multisourced.
	
	EMD Millipore, meanwhile, in addition to implementing a business continuity plan and supply risk management and emergency management programs focusing on products, suppliers, and its sites, respectively, has teamed with a third party (Resilinc Corporation) to map its supply chain for key products and suppliers to identify and mitigate risks with suppliers, according to Rodriguez.
	
	In its quest to identify a practical approach for determining the functional equivalency of unassembled components, ASI-Life Sciences submitted platinum-cured silicone tubing with similar specifications, mechanical properties, and performance profiles under typical use conditions obtained from two suppliers to Chemic Laboratories for comparative analysis of their extractable/leachable profiles. “Tubing was selected for this exercise because it is a common component of single-use systems and can be evaluated in a fairly straightforward manner,” Briggs observes. Importantly, no significant differences in the extraction profiles were observed for the two tubing samples. “These results indicated that the materials were comparable within the variability of the analytical techniques used,” Briggs says. He also recognizes that tubing is a universal single-use component, and establishing the functional equivalency of other, more proprietary single-use systems and components will be more challenging. “Our goal is to initiate a dialogue around the practical considerations for achieving dual sourcing of single-use systems.” 


	Vol. 38, Issue 12
	Pages: 24–26, 57
	Citation: When referring to this article, please cite it as C. Challener, "Securing the Single-Use Supply Chain," 

Articles

Supply Chain

Dual Sourcing and the Single-Use Supply Chain

11th Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production

 (1), which identifies various industry trends, almost all areas of R&D and manufacturing are at least in contention for some degree of outsourcing. CMOs are becoming sought-after partners as a result of their use of innovative technologies, single-use bioreactors, and other novel bioprocessing services.

Trend one: Popular outsourcing activities continue to expand


	This past year, BioPlan’s study noted a year-over-year increase in the use of many of the most popular outsourcing activities, such as:

		Toxicity testing (87% outsourcing to some degree, up from 75% last year)

	There was a general pullback, however, in the less commonly outsourced activities. These activities included downstream production operations, downstream process development, and design of experiments. Some of these downstream activities may have declined as facilities resolved problems and bottlenecks in purification steps. Despite these declines, current outsourcing levels for even those activities represented growth over levels in 2010.

	These data indicate that the most common outsourcing activities are becoming cemented in place as mainstream contract manufacturing activities. BioPlan expects that to continue, as the study also shows an increased willingness to outsource them to a greater extent in the years to come.

Trend two: Outsourcing is no longer about cost cutting


	In years past, outsourcing was used as a way to cut costs and more efficiently allocate in-house capacity; BioPlan’s recent studies indicate that cost control is no longer a top priority when outsourcing. Indeed, when respondents were asked about the cost-cutting actions they undertook during the past 12 months, only 9% had outsourced manufacturing to domestic service providers for this purpose, down from 14% last year, and the proportion that outsourced manufacturing to non-domestic service providers (off-shoring) to control costs was essentially flat at 13%, after rising from 6% since 2011 (see 

	Similarly, the share of respondents outsourcing jobs in manufacturing, process development, and R&D to cut costs remained either flat or slightly below last year’s levels.

	In a related development, the BioPlan study revealed that, this year, cost-effectiveness was not the big priority it was last year when developers were considering contract manufacturing partners. Only 22% reported that it was “very important” to them that the CMO demonstrate the cost-effectiveness of their services, roughly half the proportion (42%) from last year’s survey.

	Further, outsourcing budgets are expanding at a rapid rate, compared with other segments. And because outsourcing is a long-term and strategic decision, facilities don’t easily make changes in their outsourcing budgets, as they might for equipment purchases. This year, respondents reported having increased their budgets for outsourced biopharmaceutical manufacturing by nearly 4%, up significantly from each of the prior five years. Outsourcing is taking on a more strategic role, moving away from a simple cost calculus and toward a partnership based on quality and value.

Trend three: Outsourcing relationships evaluated on managerial factors


	While contract manufacturers should of course be able to display their technical proficiency (particularly as they bid for high-value activities previously considered too “core” to outsource), data from the BioPlan study indicate that clients are increasingly basing their partner evaluations on a host of managerial and “people” factors.
	
	When biopharma decision-makers were asked about the issues they find important when considering outsourcing manufacturing to a CMO, of the 18 most critical areas indicated, the most important were:

		Establish a good working relationship (“very important” or “important” to 98.2% of client respondents)

	To put this in context, when evaluating only critical (“very important”) attributes, more decision-makers pointed to establishing a good working relationship (70.9%) than did compliance with the client’s quality standards, protection of intellectual property, or effective handling of cross-contamination issues.

	In other words, while technical competency is important, clients are recognizing that they are not enough on their own, and that effective partnerships are built on strong relationships.

Trend four: It doesn’t matter where the CMO is located


	
	Assuming that the relationship is solid, the CMO’s location remains relatively unimportant to clients today-only 7.3% considered a CMO being local a “very important” attribute.  This runs contrary to what many CMOs have said they experience-they feel clients appreciate the opportunity to meet in person, often, and locally to watch the processes. Such in-person meetings, however, may have more to do with clients’ need to keep projects on track (a major concern), than with wanting to personally watch the CMO’s process development and manufacture.

	Although location remains at the bottom of the decision-factor list, respondents from different regions do display different preferences when it comes to potential outsourcing destinations. Western Europeans, for example, are becoming increasingly interested in China as a potential outsourcing destination: 47% of respondents from that region named China a potential destination in the next five years, representing a large increase from just 6% a few years earlier. Indeed, China drew level with the United States as a potential destination (one that is at least in the consideration set).

	Among US respondents, however, India may be the emerging market with more potential activity, while Singapore tops among Asian markets overall. In fact, Singapore topped the list of potential destinations for US respondents, 39% of whom cited it as a “possible” destination in the next five years (up from 28% in 2011). Singapore was followed in the rankings by Germany.

Trend five: Biosimilars will expand the global CMO market


	The growth of interest in biosimilars, with more than 800 follow-on products in the pipeline, will provide a significant upswing in business for CMOs who are primed to be the biggest beneficiaries of this emerging trend.

	Biomanufacturers, who have cut back on their in-house capabilities in recent years, may not use their remaining capacity for biosimilars manufacturing, given that these drugs will be lower cost and lower margin relative to innovator products. As a result, larger players may be expected to outsource the manufacture of these products to CMOs. Additionally, newer entrants to the market may well follow a business model in which they license-in follow-on products from smaller players and then outsource the manufacture of those products. Indeed, CMOs are anecdotally already reporting business increases of up to 15% from biosimilars services.


	Many of the trends identified in this year’s annual report will likely continue apace next year. Outsourcing will take on a higher-value dimension that puts cost behind other considerations, and the outsourcing market will increasingly globalize, a trend that will be fueled further by the advent of biosimilars. All in all, it’s a time of growth for biopharmaceutical outsourcing.


	Eric Langer is president of BioPlan Associates, tel. 301.921.5979, 

, and a periodic contributor to Outsourcing Outlook.


	Vol. 38, No. 12
	Pages: 50-52
	Citation: When referring to this article, please cite it as E. Langer, “Year in Review: Key Outsourcing Trends in Biopharmaceutical Manufacturing,” 

Outsourcing

CMOs are becoming sought-after partners as a result of their use of innovative technologies, single-use bioreactors, and other novel bioprocessing services.

Five Trends Shaping Biopharma Manufacturing Outsourcing

	A greatly expanded range of regulated food and drug products, now produced all over the world, has prompted FDA commissioner Margaret Hamburg to seek new ways for FDA to handle its more complex and far-flung regulatory responsibilities. Hamburg formed a high-level agency-wide group in 2013 to assess and make recommendations for improving alignment of FDA centers with its inspection field force. The result is a new Program Alignment Group (PAG) plan to integrate more closely center and field oversight functions through “commodity-based and vertically-integrated regulatory programs.”
	
	At the same time, the Center for Drug Evaluation and Research (CDER) is implementing a major reorganization designed to bolster programs and policies to ensure drug quality. After two years of planning, CDER director Janet Woodcock is establishing a new “super” Office of Pharmaceutical Quality (OPQ), a move that reflects Woodcock’s “one voice for quality” approach that coordinates review, inspection, and research activities related to drug quality.
	
	


	
	FDA’s program alignment process will revise inspection functions carried out by the Office of Regional Affairs (ORA), which manages operations for inspecting and overseeing compliance for all FDA-regulated products and companies in the United States and abroad. For drugs, a main initiative is to form an ORA pharmaceutical inspectorate, a cadre with specialized expertise to inspect and evaluate manufacturing facilities for both human and animal drugs throughout the world. CDER staff may participate in certain inspections and will provide more input into inspection scheduling, operations, and enforcement actions. Field force specialization will involve more training, and ORA laboratories will become more specialized (1).

	These operational changes will be spelled out in a five-year Pharmaceuticals Action Plan that will be developed in 2015 by ORA, CDER, and the Center for Veterinary Medicine (CVM). These parties will calculate future resource levels needed to shift from a regional oversight structure to a dedicated drug surveillance program, a process that will involve assessing the number of field investigators, compliance officers, and managers for the new program. The program will develop enforcement standards, policy guides, and guidance and clarify field and center responsibilities for issuing warning letters, enforcement actions, and decisions related to compounding, clinical disqualifications, and recalls.

	Key to formulating a multi-year, risk-based process for scheduling plant inspections and monitoring imports for ORA, CDER, and CVM is to overhaul and update manufacturer registration and inventory databases. This involves “harmonizing” center and ORA data systems, using common facility identifiers, product codes, and software platforms that permit all parties to access information on field inventory, applications, facilities, adverse events, and risk information. To this end, FDA issued guidance in October 2014 advising manufacturers to use DUNS numbers (Dun and Bradstreet’s Data Universal Numbering System) for a unique facility identifier (UFI) system (2).

	Once the program is established, CDER will supply ORA with an annual surveillance priority list that provides a basis for an ORA work plan for the coming year. A pilot for team-based domestic and foreign drug quality inspections has been launched to ensure that these changes enhance field and center agreement on where regulatory action is required.

	FDA’s Center for Biologics Evaluation and Research (CBER) should experience less disruption from this initiative to integrate field and center inspection activities, as an ORA Team Biologics has been in place since 1997 for cellular therapies and blood products, with CBER reviewers regularly participating in field inspections. Still, a Biological Products Action Plan will be developed to improve CBER’s plant registration data system and support a risk-based approach for setting priorities on facility inspections. In 2015, CBER and ORA will update existing Team Biologics procedures and identify gaps in training and policies.
	Another important PAG change is to establish a central Bioresearch Specialization Action Plan for agency bioresearch monitoring (BIMO) activities. A dedicated corps of ORA investigators will conduct BIMO inspections for drugs and biologics, as well as other regulated products.


	Meanwhile, CDER’s reorganization will go live Jan. 5, 2016, shifting to OPQ most functions of its Office of Pharmaceutical Science (OPS). OPQ will evaluate the CMC (chemistry, manufacturing and controls) submissions for drugs, biotech therapies, and generic drugs and conduct research on drug formulation and manufacturing issues (3).

	OPQ also will oversee the process for scheduling and conducting preapproval and surveillance inspections now carried out by CDER’s Office of Compliance (OC). OPQ will become responsible for certain functions related to risk analysis and informatics in planning inspections now handled by OC’s Office of Manufacturing and Product Quality, and oversight of bioequivalence testing and non-clinical studies will move from OC to CDER’s Office of Translational Sciences. These changes will enable OC to focus on compliance and enforcement activities, including recalls, supply chain security, and unapproved drugs.
	Woodcock will head OPQ on an acting basis, assisted by deputy director Lawrence Yu, who has been serving as acting director of OPS for the past year. Steve Kozlowski will continue as director of OPQ’s Office of Biotechnology Products, and Cindy Buhse remains acting director of the Office of Testing and Research. New offices will process CMC applications for new drugs (acting director Sarah Pope Miksinski) and for lifecycle drug products (acting director Susan Rosencrance), respectively. Other new OPQ operations include an Office of Program and Regulatory Operations, an Office of Policy for Pharmaceutical Quality, and an Office of Process and Facilities. An OPQ Office of Surveillance will develop written standards and inspectional procedures, led on an acting basis by Theresa Mullin, currently director of CDER’s Office of Strategic Programs where she has headed up the development of quality metrics for assessing manufacturing operations and products.

	These changes aim to achieve uniform quality oversight for new drugs, generic drugs, and over-the-counter products by providing a single drug quality assessment “that captures the overall OPQ recommendation on approvability,” Woodcock stated. Manufacturers will benefit from feedback on quality deficiencies earlier in the review cycle, and FDA will be able to provide a more uniform quality program across domestic and foreign manufacturing sites, as well as for all drug product areas. The result, Woodcock believes, will be “consistent approaches, a transparent process, and clear standards to which the regulated industry must conform.”
	Woodcock has voiced these goals repeatedly in the past two years, emphasizing the need to instill a “culture of quality”, as opposed to compliance, throughout the bio/pharmaceutical industry. She emphasized at the FDA/PQRI conference in September the importance of moving from a “rule-based” to a “risk-based” approach based on common understanding of what constitutes real risk in pharmaceutical products. Field inspections will shift from “writing traffic tickets” to full product assessment--not just negative observations but what the manufacturer is doing well. This intelligence will support a “pharmaceutical platform” with a complete inventory of regulated facilities around the world (e.g., location, ownership, products, surveillance information). CDER has been piloting its team-based review approach this past year, and Woodcock anticipates “rapid evolution” of these initiatives over the next few years.

 www.fda.gov/aboutfda/CentersOffices/ucm392733.htm

Specification of the Unique Facility Identifier System For Drug Establishment Registration, Guidance for Industry

 (November 2014).
	3. CDER, CDER reorganization, 

www.fda.gov/AboutFDA/CentersOffice/OfficeofMedicalProductsandTobacco/CDER/ucm418347.htm

 When referring to this article, please cite it as J. Wechsler, "FDA Realigns Drug Inspection and Manufacturing Oversight," 

Regulatory

FDA’s Center for Drug Evaluation and Research implements its reorganization to bolster programs and policies to ensure drug with its “super” Office of Pharmaceutical Quality (OPQ).

OPQ Sets Stage for FDA’s Realigned Drug Oversight Structure

	Indicating that the pharmaceutical-distribution supply chain is not ready to comply with product tracing provisions in the Food, Drug, and Cosmetic Act of 2013 (FD&C) scheduled to take effect on Jan. 1, 2015, FDA has issued a new guidance document that delays enforcement of the regulations for trading partners.

Implementation: Product Tracing Requirements Compliance Policy

, FDA announced that the agency does not intend to take action against manufacturers, wholesale distributors, and repackagers who do not, prior to May 1, 2015, provide or capture the transaction information, history, and statement associated with finished prescription drugs, as required by FD&C.

	According to the FDA guidance, “some trading partners have expressed concern that unforeseen complications with the exchange of the required information may result in disruptions in the supply chain, and ultimately could impact patients’ access to needed prescription drugs. FDA recognizes that some manufacturers, wholesale distributors, and repackagers may need additional time beyond January 1, 2015, to work with trading partners to ensure that all of the product tracing information required under section 582 of the FD&C Act is provided to and captured by the recipient trading partner. To minimize possible disruptions in the distribution of prescription drugs in the United States, FDA does not intend to take action against trading partners who do not, prior to May 1, 2015, provide or capture the product tracing information required by section 582(b)(1), (c)(1), and (e)(1) of the FD&C Act.”

	The compliance policy is limited to the requirements that trading partners provide and capture product tracing information and not extend to other requirements in section 582 of the FD&C Act.

	DSCSA outlines steps to build an electronic, interoperable system by Nov. 27, 2023, to identify and trace certain prescription drugs distributed within the United States. FDA published a draft guidance entitled 

DSCSA Standards for the Interoperable Exchange of Information for Tracing of Certain Human, Finished, Prescription Drugs: How to Exchange Product Tracing Information 

(November 2014), which established initial standards for the interoperable exchange of the product tracing information related to each transaction of certain human, finished, prescription drugs covered by the statute, in paper or electronic format, through the extension and/or use of current systems and processes.

	FDA notes that guidances describe the agency’s current thinking on a topic and should be viewed only as recommendations, unless specific regulatory or statutory requirements are cited.

DSCSA Implementation: Product Tracing Requirements Compliance Policy

DSCSA Standards for the Interoperable Exchange of Information for Tracing of Certain Human, Finished, Prescription Drugs: How to Exchange Product Tracing Information

FDA delays enforcement of product tracing requirements to May 1, 2015, providing trading partners more time to comply.

FDA Delays Enforcement of Product Tracing Requirements

	In a warning letter dated Dec. 19, 2014, FDA cited Novacyl Wuxi Pharmaceutical in Jiangsu, China, for “significant deviations” from cGMPS for the manufacture of APIs and “significant violations” of cGMPs for finished pharmaceuticals found during an inspection in October 2013. The letter notes that Novacyl Wuxi Pharmaceuctical’s response on Nov. 6, 2013 lacked sufficient corrective action.

	In citing cGMP deviations for API manufacture, FDA noted the firm’s “failure to manage laboratory systems with sufficient controls to ensure conformance to established specifications and prevent omission of data.”

	The FDA inspection revealed deficiencies in documentation practices, including missing raw data.  In addition, the inspection documented that the firm made changes to integration parameters for the impurities test without appropriate documentation or justification; failed to have a written procedure for manual integration despite its prevalence; failed to use separate passwords for each analyst’s access to the laboratory systems; and used uncontrolled worksheets for raw analytical data in the laboratory. In addition, FDA noted the presence of many uncontrolled chromatograms, spreadsheets, and notes of unknown origin.

	“The lack of controls on method performance and inadequate controls on the integrity of the data collected raise questions as to the authenticity and reliability of your data and the quality of the APIs you produce,” the letter notes.

	FDA notes that Novacyl Wuxi Pharmaceutical stated in its response, dated Nov. 6, 2013, that the firm would create a validation program for all uncontrolled computer systems, create a new standard operating procedure (SOP), and retrain analysts performing analytical tests. “However, observations found during the most recent inspection regarding the inadequacy of your HPLC system raises questions regarding your ability to implement sustainable corrective and preventive actions, as previous commitments made to the agency were not fulfilled,” FDA reports in the warning letter.


	FDA noted that the firm did not properly document or investigate out-of-specifications (OOS) and other discrepancies; in the case of the presence of metal particles, the firm failed to determine the root cause of the contamination or explain why the step was unable to prevent the contamination.

	The company also “failed to establish laboratory controls that include scientifically sound and appropriate specifications, standards, sampling plans, and test procedures designed to assure that components, drug product containers, closures, in-process materials, labeling, and drug products conform to appropriate standards of identity, strength, quality, and purity” and did not record all CGMP activities at the time these were performed.

	FDA has requested that Novacyl Wuxi Pharmaceutical provide an evaluation of the extent of the deletion and destruction of records; a risk assessment regarding the potential effect on the quality of APIs and drug products; and a management strategy that includes details of its global corrective action and preventive action plan. 

FDA Warning Letter to Novacyl Wuxi Pharmaceutical Co., Ltd. 12/19/14

API Synthesis and Manufacturing

Analytical and procedural deficiencies result in FDA warning letter for Novacyl Wuxi Pharmaceutical.

Chinese API and Drug Manufacturer Issued Warning Letter

	FDA set several milestones in approving more than 40 important new drugs and biologics in 2014. FDA commissioner Margaret Hamburg reported in early December that approvals were up to 35 new drug approvals an increase from 27 in 2013; the total reached 41 new drugs by year-end. Hamburg’s tally included a record 15 orphan drugs and 15 first-in-class therapies, and she noted some progress in developing new antibacterial drugs: three new medicines to treat skin infections are on the 2014 approval list. Breakthrough drug designations went through through the roof, setting the stage for more more new therapies for cancer and critical conditions to reach patients in the coming year.

	A related gain, according to John Jenkins, director of the Office of New Drugs (OND) in FDA’s Center for Drug Evaluation and Research (CDER), is that more submissions are moving through the review process in one review cycle, saving time and resources for sponsors and for all OND offices – not just cancer therapies.  And two-thirds of novel drugs approved last year were first approved in the U.S. All these accomplishments confirm the success of OND’s “program” for making the drug approval process more efficient and effective in meeting PDUFA user fee goals, Jenkins observed at the December FDA/CMS Summit in Washington, DC. That process involves more FDA-sponsor meetings during development to discuss clinical trial approaches and ensure that applications are complete.

	Sure, there’s room for improvement. Jenkins explained that FDA has been hit with a large number of breakthrough designation requests that fall far short of meeting basic standards, but which still have to be reviewed by OND staffers. FDA plans to issue further guidance to clarify the “bar” for breakthrough requests, an issue that will be discussed at a workshop with the Brookings Institution in April 2015. Jenkins also noted that manufacturing and scale-up difficulties more often are responsible for delays in bringing critical drugs to market­-compared to a lack of clinical data.

	CDER director Janet Woodcock would like to see more drugs studied in children, more anti-microbials, and additional efforts to streamline clinical trials, she said in presenting a long list of CDER goals for the coming months at the Summit conference. Although her top priorities center on new initiatives to ensure drug quality and to implement new drug compounding and supply chain security programs, Woodcock hopes to make progress on many fronts, including a re-evaluation of drug advertising regulation as it relates to first Amendment issues, managing the development of new Ebola therapies, encouraging new abuse-deterrent opioid formulations, and continuing to build FDA IT systems to manage all these activities.

	Woodcock also cited numerous opportunities to improve drug development and clinical testing.  She hopes to issue policies that encourage broader use of Bayesian statistics and adaptive clinical trials designs; sponsor studies on additional indications for cancer therapies; a benefit-risk assessment template; more guidance on specific conditions such as Alzheimer’s disease; evaluation of the impact of FDA’s patient-focused drug development program; and advancing the work of the more than 20 consortia that involve CDER staffers.

FDA set several milestones in approving more new, important drugs and biologics in 2014. Breakthrough drug designations went through through the roof, speeding more new therapies for cancer and critical conditions to patients.

More New Drugs and Faster Approvals

	The New England CRO/CMO Council, a new resource for the biotech and pharmaceutical community in and around Boston, held its inaugural members meeting in early December 2014. The non-profit council was established to market the Boston-area CRO/CMO market and will work with life-science government agencies and trade organizations to promote local outsourcing. Nearly 30 local CROs/CMOs as well as industry consultants attended the council’s inaugural meeting on Dec. 10, 2014.

	"More than 75 CROs and CMOs operate within two and a half hours of Boston, making this region the largest cluster of its kind. We represent every phase of outsourcing, which provides another reason this region is ideal for drug development," said Edward Price, president of PCI Synthesis, a sponsor and steering committee member of the New England CRO/CMO Council, in a press release. "We started the N.E. CRO/CMO Council to give a voice to local companies working to raise awareness in the larger community and in other regions. Given that it takes longer and costs more to develop drugs, the council is also looking at ways its members can streamline processes, collaborate more effectively, and help our clients get their drugs ready for FDA approval and then to manufacture those drugs on a large scale-basis."

New organization offers support to contract research organizations and contract manufacturing organizations in the New England area.