The Future of Pharmaceutical Quality

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1 The Future of Pharmaceutical Quality First SQA/BIRS Center Meeting Purdue University Polytechnic Institute Louis W. Yu, Ph.D. Chief Quality Officer

2 Unique Challenges of the Pharmaceutical Industry a. The pharmaceutical industry is a unique industry where failure is the norm: 99 out of 100 Phase III late stage therapeutic candidates failure clinical efficacy test b. High hurdles in manufacturing regulatory oversight retards post approval changes and innovation c. Lack of extensive global harmonization imposes barriers to changes in pharmaceutical manufacturing process and supply chain leading to an industry slow to make changes 1

3 Challenges & Opportunities a. Megatrends in demographics and the New Health Economy lead to growing use of healthcare products with focus on value outcomes and institutional customers playing a larger role in controlling drug choices, more restrictive access to approved drugs b. These changes in market place dynamics, has caused Pharma to struggle with stagnant growth, further constraining innovation c. Declining productivity of Big-Pharma R&D and pipeline woes are leading industry to form more alliances, partnerships and use of enterprise analytics to coax insights out of data to drive more informed decision on drug development, target specific populations for clinical efficacy and safety d. The industry increasingly looks like mega dinosaurs dominating the landscape, but outsourcing innovation and risks to small velociraptor like virtual startups however, I can see a parallel here that these dinosaurs adapt and evolve into birds that soars into the sky 2

4 PwC: The New Health Economy increasing lead to a healthcare system focused on value delivery Consolidation among providers, especially hospitals, intending to produce efficiency gains Changing demands and expectations of patients, who seek a greater role in their own care Increasing cost pressures from payers leading to calls for pricing reform Declining autonomy of prescribers To adapt, Pharmaceutical Quality has to evolve from traditional focus on safety and technical compliance to holistic value delivery for all customers users, payers, regulators 3

5 Value Delivery means a renewed focus on total Quality So what is the Current State of Pharmaceutical Quality? There are 4 degrees of separation between the patient and the developer and manufacturer of the pharmaceutical products: a. A doctor prescribes a medicine b. The prescription is filled by a pharmacist, who might substitute the Rx based on therapeutic or generic equivalency c. The pharmacy is constrained by the formulary imposed by the Pharmacy Benefit Management (PBM) company The payer for the majority of the cost of the medicine is not the patient, it is the Healthcare insurance company 3

6 Current State of Pharmaceutical Quality a. Due to the 4 degrees of separation between Pharmaceutical manufacturers and their customers, quality is not an attribute consumers pay a lot of attention to b. Overall, pharmaceutical product quality stays around 4 sigma (6,200 defects per million) c. Batch processing and lack of automation, especially for legacy products, still relies too heavily on human intervention, which is prone to human error d. Quality is about prevention, detection, correction: many pharmaceutical quality programs are overly dependent on detection & correction with insufficient focus on prevention e. Process analytical technology not widely adopted 5

7 Current State of Pharmaceutical Quality a. Schedule driven pharmaceutical development programs leads to lack of full product and process understanding before commercialization b. The separation of consuming public and manufacturers leads to a public not particularly sensitive to quality c. Manufacturing and supply chain cost of manufactured drug products are often less than 10% of cost of doing business do not provide enough incentive for manufacturing innovation 6

8 Number of Shortages Number of New and Prevented Shortages by Dosage Form, Prevented - Injectables New - Injectables Prevented - All New - All Drug Shortages Drug Shortages by Primary Reason for Disruption in Supply in 2012 Risk to product quality Benefit of availability Source: FDA s internal drugs and biologics shortages database 7

9 Product Recall 8

10 Economic Fundamentals The fundamental problem we identify is the inability of the market to observe and reward quality. This lack of reward for quality can reinforce price competition and encourage manufacturers to keep costs down by minimizing quality investments... Woodcock, J; Wocinska, M. Clin. Pharmacol. & Thera. 93: (2013) 9 9

11 Impact of Technology Innovation & Medical Science on the Industry & Future of Pharmaceutical Quality Breakthroughs will transform drug development, supply chain management and quality management: a. Biotechnology innovation leads to less small molecular entities, needs more skills in interdisciplinary science engineering, molecular biology, genetic engineering and requiring new quality engineering skills b. Mergers and acquisitions, outsourcing, in-licensing trends are leading to a much more complex and far flung supply chain network requiring advanced supplier quality management programs c. Global harmonization and mutual recognition represent positive trends to facilitate change management and continuous improvement (ICH Q, M, S, E documents) and broadening of ICH from tripartite conference to multinational council d. Innovations in supply chain management strategies, continuous manufacturing and nanomaterials will radically change drug manufacturing and quality management e. Innovations in regulatory science 10

12 Regulators are taking action to improve pharmaceutical quality Both CDER and CDRH are evolving the regulatory framework to encourage industry to embrace quality 11

13 21 st Century Cures Act Became Law in Dec 2016 Following FDUFA (1992), FDAMA (1997), FDASIA (2012), the 21 st CURES Act (2016) builds on previous legislative and regulatory initiatives to modernize the regulatory process When implemented, the Cures Act will modernize clinical design and data analysis, incorporate tools to shorten the drug development process, streamline applications for new indications, create incentives to study treatments in populations with high unmet needs, incorporate patient perspectives into the drug review process, renew user fees act, and further clarify regulatory oversight of combination products On the quality front, up to until recently, regulators and regulated are still too focused on compliance However, FDA Program Alignment, CDER OPQ, CDRH Case for Quality Initiatives will advance drug & device quality in the future 12

14 Innovations in Regulatory Science must be part of the enabling factors for the future of Pharmaceutical Quality Stages of Organizational Production and Types of Regulation Stage of Production Planning Acting Outputs (both good and bad) Type of Regulation Management Based Technology Based Performance Based Pharmaceutical regulation should be designed to improve the performance of individual and organizational behavior in ways that protect and promote public health Coglianese, C., & Lazer, D. (2003) Law & Society Review, 37(4),

15 Performance-based Regulation Lawrence Yu, Ph.D. FDA Deputy Director Office of Pharm Quality A regulatory approach that focuses on desired, measurable outcomes, rather than prescriptive processes, techniques, or procedures. Performance-based regulation leads to defined results without specific direction regarding how those results are to be obtained 14 14

16 CDER Quality Initiative: Early 2000s: FDA Embarks upon Pharmaceutical Quality for 21 st Century Initiative Vision A maximally efficient, agile, flexible pharmaceutical manufacturing sector that reliably produces high quality drugs without extensive regulatory oversight -Dr. Janet Woodcock 15

17 CDER Established the Office Of Pharmaceutical Quality FDA is Moving to Clinically Relevant Specification Quality by Testing Specification acceptance criteria are based on one or more batch data Testing must be made to release batches Quality by Design Specification acceptance criteria are based on performance Testing itself may not be necessary to release batches Lawrence Yu (Deputy Director, OPQ): We Need to Decouple Acceptance Criteria from Process Variability 16

18 CDER Quality Initiative FDA Quality Metrics Program Vision A more rigorous and comprehensive approach to quality surveillance that allows for improved monitoring of current status across the inventory of FDA-regulated drug products and manufacturing sites Goals: Objective measures Quality of a drug product Quality of a site Effectiveness of systems associated with the manufacture of pharmaceutical products Draft Guidance published July 27, ation/guidances/ucm pdf 17

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20 2017 CDRH Strategic Priority Promoting the Case for Quality 19

21 What Does This Mean? 20

22 The Role of Industry in Advancing Pharmaceutical Quality As a quality leader in industry, I see it as my personal responsibility to work with colleagues inside and outside of my company, regulators and academic institutions to advance a quality culture to deliver value to all customers: 1. Collaborate with regulators to advance regulatory science 2. Active participation with NGOs such as ISPE, PDA to advance product and process excellence 3. Volunteer in academic institutions to disseminate and cross pollinate quality science and quality education, e.g. BIRS in USA and Africa, Brookings 4. Actively build robust quality capabilities and quality culture at work 21

23 Quality Capability Building Blocks Organizational Culture Smart & healthy; Continuous improvement learning organization Governance Employee Engagement & Enablement Quality Systems Robustness (in place and in use) Fit For Purpose (Facility, product mix, process, equipment, technology, capacity, complexity) 22 22

24 Establishing A Robust Quality Culture The most important work of leaders is to cultivate the culture of the company Employees deliver quality Engaged & enabled workforce is the key to quality The right systems and process enable the workforce Employee engagement & enablement are shaped by the actions of company leadership The collective positive behaviors & actions of leaders, managers and associates builds a robust quality culture 23

25 Employees Managers Leaders Behavior Model Principles Guide the purpose of your: Systems Which encourage, reinforce, and drive: Behavior Which is your: Culture 24

26 The Future of Pharmaceutical Quality Adoption of Lean and Six Sigma Operational Excellence a customer-focused, results-oriented approach to business improvement deliver value to the customer E 2 C Total Quality (effectiveness, efficiency, compliance) Use analytics to target fit for purpose design, development, capability Globalization of Quality Global networking to focus on best practices and leverage economies of scale No significant differences among regions around the world Advances in Quality & Regulatory Sciences Evolving from manufacturing quality to full value chain (SIPOC) quality Advancing from testing quality in to quality by design Broadening focus from commercial production to full life cycle quality Current and future challenges Move to culture based Quality (principles, systems, tools) Making quality certain optimize the total cost of quality Elevation of Quality to the C suite in recent years signifies the importance of quality to the success of biopharmaceutical and healthcare sector 25 25

27 Academic Institutions Role in Enabling the Future of Pharmaceutical Quality Design programs to produce a future workforce with a new competency profile: a. Skills in design engineering and analytics to make effective use of big data b. Knowledge in global regulatory science is essential c. Skills and knowledge in material science will be in high demand Interdisciplinary collaborations and interfaces will become crucial d. Team and strategic leadership competencies, ability to drive continuous improvement and organization learning e. A workforce with strong linguistic skills that are able to operate across multiple continents f. Strong leadership and behavioral science competencies 26