Ensuring the Supply Chain through Purchasing Controls

Q: My company is developing a new product and would like to establish a secure supply chain early on in our development phase. What advice can you provide to help achieve that objective?

A: Establishing and maintaining a secure supply chain requires a strong relationship between all the departments working on the product development process, including the purchasing department. Most supply chain failures don’t start at scale, but during development. When purchasing controls are treated as a downstream activity, companies can unintentionally introduce quality, regulatory, and supply risks that become costly or impossible to unwind in the future. By increasing upfront collaboration with the purchasing group decisions and sharing specifications and material needs, procurement of materials and services can extend to factor in multiple dimensions of quality, risk, and lifecycle performance in addition to controlling expenses.

To help guide the industry, the Parenteral Drug Association (PDA) is revising ANSI/PDA Standard 001-2020: Enhanced Purchasing Controls to Support the Bio-Pharmaceutical, Pharmaceutical, Medical Devices and Combination Products Industries (1)^*. As stated in the document, “Historically, not all organizations have systems that ensure shared responsibilities for making purchasing decisions or define who is accountable for purchasing decisions and/or what measures/justifications or other controls/criteria are in place to maintain product quality. Although an independent quality unit is often considered the unit with accountability for supplier suitability, fitness, reliability and trustworthiness, other functions within companies share this responsibility” (1). In practice, this means supplier decisions cannot sit within a single function but must be addressed through collaboration across all functions.

The purpose of this document “is to provide guidance on the application of purchasing controls for companies that procure goods and services from GxP-relevant suppliers, whose product or service may affect product quality, patient safety, or regulatory compliance. The guidance applies across the full product life cycle from development through commercialization to discontinuation. It encompasses materials and components, contracted operations such as CMOs, design and logistics services, GxP-critical digital systems and technical service providers” (1).

Often, the development phase of a product has many uncertainties associated, and supply decisions are made on the basis of ‘just for development’ consideration. However, these types of actions can easily develop into a situation where a single supplier ends up with an artificial knowledge advantage over others and removes competitiveness from later on in the process. One of the first actions the development team should take is to develop a dialog and a process for procurement with the purchasing department. The purchasing and quality departments should work together to define the steps the company should employ to determine if a new supplier is needed, establish the selection requirements for suppliers (this includes initial qualification and approval), establish a quality agreement with the supplier which includes how the supplier will be monitored for performance overtime, and establish frequent communication touch-points between the supplier, the purchasing department, and the quality department. Consideration also needs to address how the supplier and the purchaser work together in case of dispute regarding the quality of the material.

A secure and resilient supply chain depends on clear ownership of accountability and alignment across multiple areas. Developmentis accountable for defining what the product needs to do and providing the expertise for the critical performance characteristics, intended use, risk tolerance, and any known suppliers. Quality is accountable for determining what is acceptable. This includes evaluating, qualifying, approving, and maintaining clear records of acceptable and unacceptable suppliers for specific materials and services. Purchasingis accountable for determining who can reliably deliver. This includes sourcing products and services at a competitive price, from a qualified supplier, from a qualified source, in a way that complies with other company procurement expectations and requirements (1).

Maintaining and establishing a sustainable supply chain is achievable when company departments work together and establish acceptable procedures, document actions, and delineate responsibilities with respect to supplier interactions. Organizations that treat purchasing as a strategic partner, not a transactional function, build supply chains that scale with confidence and plan for future potential risks early on.

Reference

1. PDA. ANSI/PDA Standard 001-2020: Enhanced Purchasing Controls to Support the Bio-Pharmaceutical, Pharmaceutical, Medical Devices and Combination Products Industries. April 2020. *This document revision is in the public review commenting stage and should be released in 2026.https://www.pda.org/bookstore/product-detail/5596-ansi-pda-standard-001-2020