Outsourcing analysis

Published: 8-Jul-2011

What started as the contracting out of routine lab work has since progressed into a multifaceted, broad-ranging support industry. Jane Sanderson, head of Analytical Services, Brecon Pharmaceuticals, looks at the ever-broadening requirements for outsourced analysis

What started as the contracting out of routine lab work has since progressed into a multifaceted, broad-ranging support industry. Jane Sanderson, head of Analytical Services, Brecon Pharmaceuticals, looks at the ever-broadening requirements for outsourced analysis

Over the past two decades outsourcing has penetrated almost every area of the pharmaceutical industry – from discovery through clinical trials to commercialisation. In many cases what starts out as a short-term, tactical option – a response to a sudden peak in demand, for example – frequently evolves into a strategic choice in favour of long-term relationships with trusted CROs and CMOs.

The way pharma companies outsource contract analytical services is no exception. Bringing a new product to market requires numerous analytical procedures, including product testing, method development and validation, stability testing, release testing and pharmacopoeial testing of APIs, excipients and finished products. Furthermore, even after commercialisation there is an ongoing need for testing during the product’s lifetime.

A number of factors are driving the evolution of analytical laboratories from ‘hired hands’ simply following instructions and presenting clients with a set of data into a valued resource that adds real value to a project by giving constructive input based on a breadth of expertise. Although there is always demand for ‘fee-for-service’ analysis, laboratories must be able to offer full development support based on in-depth understanding both of chemical development and – of vital importance in a global market – the regulatory regimes in different markets.

In the current climate, pharmaceutical companies are looking to focus on in-house areas of expertise and to outsource services that can be delivered on a more cost-effective basis without losing a quality focus. Buying in analytical expertise as and when needed provides flexibility in resource allocation and access to costly specialised equipment without need to invest in expensive infrastructure.

Yet even a strong economic recovery would do little to reduce the attraction of outsourcing, because of the big structural factor that further clouds the commercial outlook for Big Pharma: patent expiry on the blockbusters that have filled its coffers for so long. According to a 2010 report by Accenture on the industry’s supply chain, since 2005 patents have expired on products accounting for more than US$80bn in annual sales, and despite significant r&d expenditure there are few replacements in the pipeline.

It is therefore imperative that when promising candidate treatments are identified they are pulled through the pipeline as quickly as possible and outsourcing helps expedite this process. It also allows companies to explore projects that may be outside their usual areas of expertise by outsourcing early-stage analysis before deciding whether to commit more substantial investment.

finding a home

Ironically, the economic downturn has played a significant part in the expansion of outsourcing in the sector, because much of the scientific expertise lost to pharmaceutical businesses through headcount reduction is finding a ready home in the contract laboratories. Recruiting higher-calibre people has, in turn, generated demand for, and justified investment in, higher-capability equipment. The injection of knowledge and sophisticated analytical instrumentation has equipped these laboratories to help clients respond to three important industry trends.

The first is the greater complexity of today’s products. Compounds are increasingly challenging from an analytical point of view, making methods harder to develop (especially true of biologic products). It is becoming more difficult for pharmaceutical companies to maintain the broad-based expertise that contract laboratories develop in the course of working for a variety of clients – Brecon, for example, is working with more and more novel dosage forms.

The second is the ever-increasing presence of the virtual pharmaceutical company. Even in a difficult economic climate there are still entrepreneurs willing to take sizeable risks on a single compound, outsourcing all the processes needed to reach proof of concept then selling either the product or the company. For these businesses and for smaller pharmaceutical companies generally, outsourcing enables them to overcome the industry’s hitherto high barriers to entry and compete with Big Pharma.

knowing the rules

Finally, there is the global regulatory environment. Again, working for a broad spread of clients, contract laboratories acquire knowledge of different regulations in key markets such as the US, Europe and Japan.

At Brecon, for example, the stringent regulations governing marketing products in the EU provide a steady flow of work for the laboratory. Products sold in the EU but manufactured in a country with which there is no mutual recognition agreement must undergo retesting to the registered Marketing Authorisation specification before being released for sale, and this is in addition to the QP requirements for release.

Furthermore, new regulations continue to be introduced. The latest one to affect the EU is the Traditional Herbal Medicinal Products Directive (2004/24/EC), which requires traditional over-the-counter herbal remedies to be manufactured to assured safety and quality standards throughout Europe. Although the directive came into force in 2005, it specified a transitional period for products that were legally on the market on 30 April 2004. This period ended on 30 April 2011.

All these factors explain why quality considerations are critical when companies choose an outsourcing partner. Not only must the quality of the data be excellent – if it isn’t, time and money have been wasted on invalid results – but the same quality must extend to project delivery and, in particular, to communication between laboratory and client.

Good communication is vital to overcoming the main objection to outsourcing the most critical analytical processes – the fear of not being in control, which is ingrained in the culture of some pharmaceutical companies. It starts from the outset with agreement on the scope of the work, the technical details, quality require-ments and service levels. Both parties need to agree how data will be documented and reported and – of special importance – how out-of-spec results are flagged up and responded to. In cases where deadlines are tight, it is also vital to establish clear and reasonable expectations regarding turnaround; after all, timetables need to combine delivery (hitting the key milestones on schedule) with flexibility (allowing time to investigate unexpected results).

Having fit-for-purpose communications systems in place is as important to a laboratory as investing in the latest instruments. In an online world, it is no surprise that the Internet is playing a big part and laboratories are moving towards providing clients with web-based, 24/7 access to the status of their project, including a window into the data being generated.

Involving the right people is also key. As well as a single point of contact at both ends to manage the business relationship, it is of paramount importance that scientists from the laboratory and the client communicate, not only at the start – ensuring, for example, that the project protocol includes all the technical details – but throughout the project.

Before finally deciding between competing laboratories, there is a further factor to consider: the choice between a standalone operation and one that is integrated with other services. At Brecon, for example, analytical services is one of a range of outsourced activities: clinical trials support, commercial packaging, qualified person (QP) services, and storage and distribution. All these services can be offered individually or packaged as a bespoke solution for each client.

In the light of the increased complexity of product development projects, there are considerable advantages to this ‘one-stop’ option – its single technical agreement and audit and the subsequent reduction in cost and resource being one of them. Compared with the multi-party model, it is clear who is responsible for delivering the project; it should also avoid costs incurred transferring data and materials between different parties at different stages, as well as reducing risk. However, what often clinches the argument for prospective clients are the benefits that come from daily experience of how the analytical function fits into the development process.

valuable partners

A major benefit is flexibility. In a recent example, Brecon worked with the clinical trials division on a time-critical trial that was already part completed, transferring all the methods to the tightest deadlines, ensuring no interruptions in the stability protocol. The company has recently similarly partnered with its commercial packaging colleagues to help steer a non-EU client’s very complex product through gaining its EU marketing authorisation.

With the EU continuing to tighten regulation of the pharmaceutical industry, outsourcing organisations need to offer a broad base of capabilities. For example, under amendments to Annex 16 (Certification by a Qualified Person and Batch Release) of the EU guide to GMP, companies must retain enough samples to carry out two sets of full analytical tests. This clearly argues in favour of outsourcing to organisations that combine storage facilities with analytical services and possess extensive experience of method transfer and validation.

In addition, a global pharmaceutical industry calls for suppliers with a global perspective on all aspects of product development. In clinical trials, for example, there is a clear trend for pharmaceutical companies to outsource projects almost in their entirety to organisations that can also manage packaging, storage and distribution and QP services, and provide analytical services incorporating access to international scientific expertise.

Many laboratories provide this through partnerships with laboratories in key markets, such as the US. Brecon shares processes and expertise with its US sister company Anderson Packaging, which enables EU-based clients to test products in Anderson’s facilities, and vice-versa.

Looking to the future, all the factors described suggest that outsourcing analytical services will only expand. While the recent economic crisis undoubtedly played a part in encouraging pharma companies to explore the outsourcing option, cutting costs is no longer their main motivation. In the final analysis, considerations of cost control, quality service and regulatory compliance are paramount, and outsourcing delivers these on many levels.

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