Quality Metrics and CMO Agreement

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Pharmaceutical Technology, Pharmaceutical Technology-02-01-2017, Volume 2017 Supplement, Issue 1
Pages: s40-s42

FDA’s focus on the quality culture and its request for quality metrics may ensure a successful company-CMO relationship.

FDA’s focus on the quality culture and its request for quality metrics may ensure a successful company-CMO relationship. FDA’s draft guidance Submission of Quality Metrics, Rev 1 (1) is now accessible after extensive deliberation and comments from the industry. FDA believes that measurements to evaluate quality of facilities and processes should aid the agency’s site inspection efforts (2). The guidance is expected to ensure that drug products are continually manufactured under high quality standards. In addition, it encourages manufacturers to self-monitor using robust quality measurements. 

FDA recognizes the trends in current pharmaceutical business models with multiple contract manufacturing organizations (CMOs) involved in commercial manufacturing and supply-chain operations. FDA warning letters (3) justify the need for clearly defining cGMP-related roles between product owners and contract facilities. The final FDA industry guidance on Contract Manufacturing Agreements for Drugs: Quality Agreements was issued in November 2016 (4).

The contract manufacturing market is predicted to increase at a healthy rate of 7.5% annually; many of them converting from CMOs to contract development and manufacturing organizations (CDMOs) (5). FDA recognizes that CDMOs can enhance speed, efficiency, technical expertise, scale-up knowledge, and expertise (4). The guidance will ultimately benefit the patients who are prescribed drug products manufactured at the CMO sites under the agreement. Illustrative cases discussed in the guidance are typical with CMO projects. The agency considers the product owner ultimately responsible for ensuring their product, a human, veterinary, biological, biotechnology drug product, a drug substance, an in-process material or a combination product, is made in compliance to cGMPs even though a quality agreement may assign specific manufacturing activity to the CMOs. The European Union guidance also entails that outsourcing activities should be defined and a contract written to avoid misinterpretations that may result in poor quality (6). 

International Council for Harmonization (ICH) Q10 and Pharmaceutical Inspection Co-operation Scheme (PIC/S) Good Manufacturing Practice for Medicinal Products require written agreement between contract giver and acceptor for outsourced pharmaceutical activities (7, 8). A written quality agreement is, therefore, a collective requirement in the industry, developed in consultation with a cross-functional team, ensuring partners operate with the same reference guidance (9). The collaborative development of the agreement provides a better sense of the CMO quality systems and quality focus, which will potentially pave the way to improved business relationships. Lack of clarity on cGMP responsibilities can put both product owners and contract facilities at risk. The resulting scenarios such as non-compliance, broken contracts, drug product shortage, and loss of market have a direct business impact for both parties. 

FDA quality metrics guidance

The first draft of Request for Quality Metrics guidance was issued in July 2015. This guidance document explained the intent of FDA’s Center for Drug Evaluation and Research (CDER) and Center for Biologics Evaluation and Research (CBER) to collect data and use quality metrics to ensure continuous improvement and innovation in the industry (10). FDA’s directors acknowledged that the guidance is an important first step on a shared industry/regulator effort toward further improving drug quality (2). Webinars and public consultations were held to communicate the key points about the guidance’s intent, namely encouraging the industry in implementing good quality management systems, improving regulators’ risk-based inspection management, and to better forecast potential for shortages in drug supply chain. FDA supplemented the draft with a technical conformance guide, providing the industry with specific technical details on the quality metric data submission requirements (11). The agency has considered industry comments (12) on the first draft. The revised guidance post consultation now allows firms to report quality metrics by product or by site. FDA has also revised the requirements for data reporting and has added some examples. The initial intent is to have the reporting voluntary. One notable exclusion in the current revision is that of the Optional Metrics Related to Quality Culture and Process Capability/Performance. FDA has also incorporated a provision for firms to submit a 300-word comment to provide further explanation on the submitted data, and to elaborate on further plans for improvement. 

The quality metrics guidance is a result of a carefully considered long-term quality improvement strategy from FDA. This guidance, as discussed in the background section, continues the efforts initiated by FDA since development of the final report on Pharmaceutical cGMPs for the 21st Century-A Risk Based Approach (13) from September 2004. The report identifies that product quality and productivity improvement share a common element (i.e., reduction of variability by virtue of process understanding though the lifecycle). It reinforces that reducing variability provides positive outcomes for both patients and the industry. 


One reportable metric is the lot acceptance rate (LAR). This metric is an effective tool for estimating the cost of quality for manufacturing sites. It would reflect the real effectiveness of unit operations or continuous manufacturing lines, where current measurement norms focus primarily on productivity numbers. The LAR metric allows for senior management decision making and continuous improvement opportunities for products.  

The second reportable metric is product quality complaint rate (PQCR), ensuring patient or customer focus. Regulator expectation is to ensure timely and effective corrective actions and preventive actions (CAPA) are taken when customer complaints arise. With an improved PQCR, the industry will achieve considerable patient confidence and professional goodwill, a desired outcome for any pharmaceutical organization. 

The guidance indicates that invalidated out-of-specification rate (IOOSR) is an indicator of the laboratory operations effectiveness. This includes IOOSR from both routine release and stability testing. Analytical variability is one of the major sources of variability for test results (14, 15). Routine calculation and reporting of IOOSR will provide a threshold for further investigation into the root cause of such unintended analytical variability (e.g., analyst, instrument, test method, reagents, standards). The metric can be incorporated as part of the analytical quality by design (AQbD) continued monitoring stage (16). Commercial laboratory operations are equally critical as manufacturing operations. The index provides senior management clear insights into the true laboratory operations efficiency; highlighting the level of analyst expertise, need for instrumentation upgrades, performance of external laboratories (if any), and capturing analytical method robustness. 

Creating a quality culture

FDA intends to publish a list of establishments that voluntarily report quality metrics. By doing so, the agency would be effectively propelling industry participation in regularly reporting metrics by publicizing the efforts put in by those organizations to key stakeholders. The agency engagements during the voluntary reporting phase is an opportunity for organizations to demonstrate effectiveness of their quality management systems, product/process control strategies, and cGMP compliance. The guidance itself identifies that the list may be useful for identifying contract manufacturers and for healthcare purchasing/sourcing groups. The reporting organizations will be categorized and identified into top and mid tiers such that the stakeholders can recognize the level of data being submitted. 

With the recent focus in quality culture and pharmaceutical quality systems by regulators, the industry is expected to ensure better quality and predictability, driving businesses to succeed. The Submission of Quality Metrics and Contract Manufacturing Agreements for Drugs: Quality Agreements guidance documents are rightly aligned with this goal. FDA may request information such as product recall and customer complains as per Section 704 of the Food, Drug, and Cosmetic (FD&C) Act (17). Also, 21 Code of Federal Regulations (CFR) Part 211 (a) requires the company’s quality unit to be responsible for products manufactured by a CMO (18). The business benefits of effectively implementing the guidance requirement include prevention of manufacturing issues, prediction of supply disruptions, and development of a sustainable CMO relationship in addition to the non-tangible element of stakeholder confidence and goodwill. The new quality standard guidance’s developed by FDA will improve regulator-industry transparency. It will reduce process variability and encourage use of the best technology and innovation in the pharmaceutical industry. Adoption of guidance requirements will result in well-established quality systems through the manufacturing sites; potentially reducing the regulators resources required for monitoring (e.g., reduced site audit cycle). Both the patient and pharmaceutical companies are positioned to significantly benefit from the current regulatory strategies. 


1. FDA, Guidance for Industry, Submission of Quality Metrics Data, Rev 1, Draft Guidance (CDER, Silver Spring, MD, November 2016).
2. A. Boam and M. Malarkey, “‘Quality Metrics’: FDA’s plan for a key set of measurements to help ensure manufactures are producing quality medications,” FDA Blog, July 2015.
3. FDA Enforcement Actions, warning letters, US FDA, February 2016.
4. FDA, Guidance for Industry, Contract Manufacturing Agreements for Drugs: Quality Agreements (CDER, Silver Spring, MD, November 2016).
5. N. Walker, Pharmaceutical Manufacturing(January 2016).
6. European Commission, Good Manufacturing Practice for Medicinal Products for Human and Veterinary Use, Volume 4, Chapter 7 (European Commission, January 2013).
7. ICH, Q10 Pharmaceutical Quality System, Quality Guidelines (ICH, June 2008).
8. PIC/S, Guidance, Good Manufacturing Practice for Medicinal Products, Part 1, Chapter 7 (PIC/S, January 2017).
9. A. Pazhayattil, Pharmaceutical Manufacturing (May 2008).
10. FDA, Quality Metrics for Drug Manufacturing, cGMP’s for Drugs: Reports, Guidances and Additional Information, FDA.gov.
11. FDA, Technical Specification Document, Quality Metrics Technical Conformance Guide (FDA, June 2016).
12. FDA, Technical Specification Document, Comments-Docket ID: FDA-2012-D-1595, FDA.
13. FDA, Final Report, Pharmaceutical cGMPs for the 21st Century-A Risk-Based Approach (FDA, September 2004).
14. B. Nunnally, J Validation Technol, 78-88 (Summer 2009).
15. N. Sayeed-Desta, et al., “Assessment Methodology for Process Validation Lifecycle Stage 3A,” AAPS PharmSciTech: 1-6 (2016).
16. G. Martin, et al., “Lifecycle Management of Analytical Procedures: Method Development, Procedure Performance Qualification, and Procedure Performance Verification,” USP Stimuli Article. 
17. FDA, Guidance for Industry, FDA Records Access Authority Under Sections 414 and 704 of the Federal Food, Drug, & Cosmetic Act (FDA, April 2014).
18. FDA, 21 CFR Chapter 1, Subchapter C, Part 211, Subpart B, Section 211.22 (a), April 2016. 

Article Details

Pharmaceutical Technology
Vol. 41, No. 2
February 2017
Pages: s40-s42


When referring to this article, please cite it as N. Sayeed-Desta, A. Pazhayattil, and J. Spes, "Quality Metrics and CMO Agreement," Supplement to Pharmaceutical Technology 41 (2) February 2017.