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FDA’s or Industry’s Responsibility?

 During my opening remarks at the 4th Annual Manufacturing Execution System in Life-Sciences Conference, I discussed FDA’s proposed budget increase of 166 Million Dollars and 346 FTEs toward Medical Product Supply Chain Safety and Security Oversight.

The globalization of manufacturing and supply of medical products has created unique and demanding challenges for industry and FDA alike.  Yet, according to a recent Axendia study on QMS trends in Life-Sciences, only 34% of respondents reported view global quality data in real time.

In the complex and ever-changing environment driven by globalization, license holders and regulators must seek out new approaches to ensure the safety of medical products.  

The Industry’s Role:

In his Keynote, Gerald Migliaccio, Pfizer’s Vice President of Quality, EHS and Agility - Pfizer Global Manufacturing, addressed Supply Chain Security from an industry perspective.

“Supply chain security is the responsibility of all parties involved in procurement, sourcing, manufacturing, packaging and distribution of raw materials, intermediates and final product,” commented Mr. Migliaccio.  “Ultimately, the marketing authorization holder(industry) is responsible for assuring that all parties in the supply chain fulfill their responsibilities for delivering safe and effective medicines to customers” he added.

According to Mr. Migliaccio, strong supply chain security strategies benefits both patients and industry by:

• Preventing Adulteration
• Preventing and Detect Counterfeits
• Preventing Product Diversion

These strategies should include the following key elements:

• Financial viability of business partners throughout supply chain
• Ethical Business practices throughout supply chain
• Physical security
• Container/freight movement security
• Personnel security

Supply Chain Quality Systems:

• Supplier / contractor evaluation and selection
• Supplier / contractor management and oversight
• Supplier / contractor management of their supply chain

Counterfeit Prevention:

• Overt measures
• Covert and semi-covert measures
• Forensic covert measures
• Counterfeit Detection
• Surveillance programs
• Support for Law Enforcement agencies

Business Intelligence: 

• Proactive analysis of pricing and supply trends to predict potential areas of criminal activity

Internal and External Collaborations:

• Cross-functional collaboration between manufacturing, quality, security, logistics, marketing and others to drive Supply Chain Security efforts
• Industry collaboration through PhRMA, EFPIA, ISPE, and industry coalitions, such as RX-360
• Collaboration with suppliers, contract manufacturers, transporters and distributors
• Collaboration with Law Enforcement and Regulatory Authorities

The Agency’s Role: 

For its part, the FDA plans to increase its oversight of the Supply Chain to ensure safety and security.  This will prevent harm to the public by achieving greater compliance with safety standards, detecting and correcting safety risks.

• FDA is proposing a budget increase of $166,433,000 and 346 FTEs to improve medical product Supply Chain Safety and Security.
• FDA will increase medical product safety and security by enhancing oversight of entities in the supply chain.
• FDA will use traditional and innovative mechanisms that include FDA inspections and field exams, integrated federal-state oversight, and greater access to inspection data and results acquired from trusted foreign regulatory authorities.

By Daniel R. Matlis

During the last Microsoft Health and Life-Science Conference, I had the privilege to participate in an enlightening discussion with stakeholders (or special interest groups, depending or the news network you watch) in Healthcare Reform.

The panel represented a board spectrum of constituents and included (in alphabetical order):

• Jeff Brown - Director IT, Partners Healthcare
• Deighton Liverpool - Director,  IT , American Association for Cancer Research
• Okey Okuzu - Director -  US Managed Markets Strategy & Innovation, Novartis Pharmaceuticals Corporation
• Arman Ozgun – Managing Partner, Netsoft USA
• Chad Pomeroy - VP Innovation & eBusiness, WellPoint

The session provided ample opportunity to discuss and highlight key challenges and opportunities of the US healthcare system.

In my opinion, the underlying problem with the current Healthcare system is misaligned incentives.  That is, each stakeholder is incentivized and compensated based on different and often conflicting benchmarks.

For example:

• Research institutions seek public and private funding to conduct focused research
• Life-Science companies seek to recoup and profit for the high risks and costs associated with bringing new products to market
• Health Insurers seek to manage and lower healthcare costs and make profit
• Healthcare providers seek to improve patient outcomes and reduce costs while minimizing litigation risks
• Technology companies offer enabling platform to automate and “smart-up”  healthcare

What if we found a way to align incentives and gain synergies from all these stakeholders? 

Imagine, if you would, a model where each stakeholder is a link in the healthcare chain, and gets benefits from others in the ecosystem.

In this environment:

• Research institutions could partner with Life-Science companies early in the discovery process and feed new compounds to Pharma R&D. 
• Another benefit is looking blockbusters from the trash bin.  In other words finding new uses for compounds that did not show promise with the initial target (Rogaine and Viagra were side effects)
• Hospitals could provide de-personalized patient information to build better models toward the road to virtual clinical trials and targeted “personalized medicine”
• Insurance companies could lower costs and make better treatment decisions based on appropriate diagnostic tools and “pay for outcome” model (Geisinger already offers Heart Surgery warranty which has lowered costs as well as 30-day readmission rate 44%) 

These do not even take into considerations the benefits associated with bringing medical records to the electronic age or applying Lean and Six Sigma techniques to a very inefficient Healthcare model.

According to a recent reports, patients in the American Healthcare system received the recommended care only 54.9% of the time. By contrast, your car, phone and PC are built to meet requirements 99.997%. 

In my opinion, aligning incentives for healthcare stakeholder would yield lower healthcare costs and improved patient outcomes.