Building, Managing and Continuously Improving Clinical Supply Chains

1. Building, Managing and Continuously Improving Clinical Supply Chains IQPC Clinical Trial Supply Europe, Basel, February 1 2012 Presented by: Hedley Rees, Director

2. AGENDA • Where are we now in the Pharma supply chain? • What could the future hold? • Case study: Perfect Pills and Potions • Discussion www.globalcompliancepanel.com

3. Where are we now in the Pharma supply chain?

4. The Supply Chain Fragments…. • 1970's: • Prevailing business model vertical integration • local market management presence. • predominately small molecule manufactured by chemical synthesis. • 1980’s • Outsource non-core activities • Manufacture, analytics, distribution, storage • Since • New business models - innovator, virtual, biotech, generic/bio-similars and speciality Pharma • Biologics form important portfolio position, with temperature and time sensitivities • Markets have globalised into new territories • Number and location of third party contractors and service providers proliferate.

5. A typical Pharma supply chain

6. Current state supply-chain

7. Information, information, information….

8. Supply chain foundations begin in drug development

9. How the supply chain is formed

10. Supplying Pre-Clinical Programs

11. Typical End-to-End Supply Chain – First in Humans Study • Initial dosage form may be compromise eg hard gel capsule. • Can disguise issues such as poor dissolution profile. • Final dosage form may be compromise. • Initial inertia to change established. • Filing contains sub-optimal data. • Sourcing options limited by filing. • Locked-in to processes, contractors and other Value Chain parameters.

12. Examples of potential issues • Initial dosage form may be compromise eg hard gel capsule. • Can disguise issues such as poor dissolution profile. • Final dosage form may be compromise. • Initial inertia to change established. • Filing contains sub-optimal data. • Sourcing options limited by filing. • Locked-in to processes, contractors and other Value Chain parameters.

13. Examples of potential issues Cost Material price Yield losses Batch failures Re-work Age-expiry Quality 100% inspection Investigations CAPA Customer complaints Delivery Performance Long lead times Stock-outs Shortages Customer returns

14. What could the future hold?

15. The 21st Century Initiative • Pharmaceutical cGMP’s for the 21st Century – A Risk-Based Approach: • Started 2002 and reported late 2004 • Desired state: “A maximally efficient, agile, flexible pharmaceutical manufacturing sector without extensive regulatory oversight.” Dr. Janet Woodcock, the U.S. Food and Drug Administration's Deputy Commissioner for Operations

16. History of improvement in production systems • Industrial Engineering (IE) • Total Quality Management (TQM) • World Class Manufacturing (WCM) • Theory of Constraints (ToC) • Toyota Production System (TPS) • Systems Thinking • Deming wrote the book over 50 years ago!

17. The Supply Chain Holistic • Production & Inventory Control (P&IC) • Procurement • Transportation, storage and delivery • Information Systems/Information Technology (IS/IT) • Improvement • Integration

18. Linking up the value chains

19. Lean background • NUMMI study, Womack & Jones “The Machine That Changed the World” • Based on Toyota Production System (TPS) • Reduce time between getting order and money in • Respect for people • Continuous improvement • Five principles • Many parallels with TQM, WCM, TOC, etc.

20. Five Principles of Lean 1. Specify value from the standpoint of the end customer by product family. 2. Identify all the steps in the value stream for each product family, eliminating whenever possible those steps that do not create value. 3. Make the value-creating steps occur in tight sequence so that the product will flow smoothly toward the customer. 4. As flow is introduced, let customers pull value from the next upstream activity. 5. As value is specified, value streams are identified, wasted steps are removed, and flow and pull are introduced, continue until a state of perfection is reached in which value is created with no waste.

21. Process Village v Value Stream

22. Traditional functional layout– solid dose Key points: Large batches Produce to forecast High in-process inventory Defects are hidden

23. Value stream alignment – solid dose Key points: Schedule pacemaker only. Set rate at TAKT (Production rate required to match rate of consumption in the market place. Pull from the pacemaker (Kanbans and supermarkets) Solve production problems (A3 Management) Take out variation (SPC). Reduce defect rates on incoming materials. Use Single Minute Exchange of Dies (SMED) to reduce cycle time

24. Case study: Perfect Pills and Potions

25. Discussion

26. Check list… • Identifying stakeholders • Listening to Voice of the Customer (VoC) • Defining Critical to Quality Attributes (CTQs) • Creating 'one shared view' • Analysing the current state map • Seeing the whole • Deciding architecture and reach • Agreeing target and future states • Developing a control plan • Gaining organisational buy-in

27. Questions If there are any further questions which I was not able to get to today please feel free to contact me at: H.rees@pharmaflowltd.co.uk