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The five competencies of continuous regulatory compliance

Published on 28/04/17 at 09:17am
Image Credit: isparku

Look at any country or region with a strong generic pharmaceutical and active ingredient manufacturing sector, and you are sure to see a diverse industry with business models that range across a spectrum.

That spectrum is typically composed of fine chemical and API producers, generic drug manufacturers and marketers, CRAMS (Contract Research & Manufacturing Services) providers, specialty pharmaceutical companies promoting smaller niche brand portfolios, and young companies developing NCEs or applying new technologies to old molecules, all the way to billion-dollar fully integrated enterprises with global businesses that range from API production to research and development of novel small molecules, biologics, and biosimilars.

Nowhere is this kind of industry dynamic more apparent than in India, often and rightly referred to as “the world’s pharmacy.” Here, hundreds if not thousands of firms of various sizes and business models all coexist at different stages of growth, pursuing their own particular strategies and ambitions, each with their individual strengths and capabilities.

Figure 1 shows the typical growth and development trajectories of many companies in the generic pharmaceuticals segment over the past 30 years, together with the business drivers that often prompt these companies to change what they do.

Regardless of their location, size, and sales revenues and where these companies exist on this growth continuum, one of the many challenges they face as their businesses develop is that of managing regulatory compliance. Companies must continuously adapt to changing regulatory requirements while effectively managing the associated costs and resources required to fulfill those requirements. As companies embrace new business models or new markets, complete new regulatory systems may come into scope and will need to be fully understood before they can be applied. A new system of in-house standards and procedures must be developed and staff fully trained as the new standards are established throughout the business.

For example, an Indian generic manufacturer familiar with GMP (Good Manufacturing Practice) introducing a new contract research service will most likely now need to understand and implement GLP (Good Laboratory Practice) and GCP (Good Clinical Practice) in a way that meets the regulatory requirements for prospective customers in multiple countries, internationally and perhaps even globally. Take the example of a US-based contract manufacturer wishing to enjoy the improved margins and opportunities created by developing its own portfolio of generic products instead of making products for other companies. While the business may already be well versed in GMP compliance, distributing and marketing its own line of products brings many new regulatory requirements into scope, not the least of which may be new serialization and “track and trace” rules.

Therefore, as companies find new markets for their products and services, the task of managing compliance requires an intimate understanding of regulations in each and every country of operation, regardless of language. Local practices must be understood and embraced. Regulatory requirements must be reflected in in-house quality controls, standards, and procedures. Finally, companies must balance these requirements with often conflicting demands and pressures caused by the market, competition, and changes in technology. Figure 2 shows how compliance requirements manifest within each type of business and how a number of current initiatives by regulators impact the organization.

With all this in mind, managing compliance efficiently has never been more important. Compliance applies at every stage of the product life cycle, from preclinical research to market authorization and from market authorization to commercialization. Steps must be taken to ensure compliance across all groups involved in research, preclinical testing, clinical development, dossier preparation and submission, manufacturing, distribution, marketing, and post-approval activities. For many companies, this must be done at a local, regional, international, and even global basis.

The Indian pharmaceutical industry has not been without issue with regard to meeting the challenge of regulatory compliance in recent times. Many companies have paid a heavy price for failed regulatory inspections, data falsification, and quality issues, some of which are still dealing with the implementation of required corrective actions many years past the original inspection. April 2016 for example, has seen IPCA, EMCURE, and Sri Krishna Pharmaceuticals all cited for various GMP violations by the US FDA, illustrating that large, mid-size, and small manufacturers of varying ages still struggle with compliance issues.

Meanwhile, following recent actions by the French regulator (ANSM) and subsequent withdrawal of a GMP Certificate at Anuh Pharma, the WHO has removed two APIs produced by the company from its prequalified supplier list.

While the direct monetary impact of these failures and implementing the required corrective actions can be very significant, noncompliance can adversely impact a company’s reputation, leading to lost customers and a reduced capacity to win future work. Companies must often work twice as hard again to win back the confidence of ex-customers and prospects in the face of regulatory failures. Other long-term, follow-on impacts that compound losses include delays to product approval and market uptake, product recalls, import bans, invalidation of clinical trial results, consent decrees that result in loss of control of manufacturing facilities, and dwindling market share. Some companies have even weakened to a point where they have been easy prey for their acquisitive competitors.

What can companies do to ensure that compliance is maintained at all times and across every aspect of the business that requires adherence to regulations? Figure 3 shows five interdependent competencies in which companies must excel in order to succeed in today’s fast-changing regulatory landscape.

Competency #1:

Companies need to understand, compare and contrast the regulations in each and every country of operation in order to develop the most effective strategy to maintaining compliance across the enterprise.

Companies need access to a constantly up-to-date repository of regulatory requirements issued by each regulatory agency that is within the operational scope of their business. The repository should organize documents in such a way as to allow for rapid determination of the common elements and differences from country to country. Doing so will enable regulatory staff to quickly identify the minimum set of requirements necessary to maintain compliance across all jurisdictions and thereby design the most expeditious internal standards and procedures that meet those needs. Companies may also seek the guidance of local regulatory experts in each country of operation in order to understand the full meaning and intent of regulations.

Foreign languages, the sheer number of documents involved in even simple regulatory systems, and the pace of change to regulations are all factors that make this a complex exercise. Most companies would rather not invest large amounts of resources in collecting and maintaining regulatory documentation, so automating these tasks and allowing staff to focus on the more valuable “internal translation” of the requirements into company standards and procedures can offer a considerable advantage. It is not uncommon for regulatory inspectors to demand evidence that all these types of controls are in place in the business. Having in-country regulatory experts can also help guard against problems caused when there are differences between the letter of the regulations and guidelines in a country and how the local regulator behaves during inspections. Not following all of these disciplines can have a significant impact on a company’s market expansion and partnership ambitions.

Having regulatory personnel who are intimately familiar with the global regulatory environment also bestows another important advantage on these companies in that they are often able to contribute to regulatory developments and influence the future direction of regulations.

Competency #2:

Continuously monitor regulatory changes, and rapidly interpret and understand what’s new.

Regulations are under constant change in every country of operation, and companies often struggle to dedicate the right level of resources to monitoring these changes. The problem is often compounded when operating in countries where documents must be translated into the local language or English without losing the intent and meaning of the changes. A company’s ability to keep abreast of changes and its speed of response to those changes may also be affected by translation issues.

To maintain ongoing compliance, companies must have systems in place that notify key personnel of changed or new requirements at the earliest possible opportunity. Those staff should be able to quickly interpret and understand the reasons for the change, and be able to identify the scope and nature of changes required to internal standards and procedures in order to align with the required changes. Companies holding market authorizations are also responsible for pharmacovigilance, and must be able to respond quickly to product complaints from patients, investigate quality issues, or conduct recalls in an organized manner, if required. Again, in-house standards and procedures must reflect current requirements in each market in which products are sold.

Without these controls in place, internal standards can quickly become out of date, or the amount of changes and the activities to implement them soon overwhelm regulatory staff, both of which increase the risks of noncompliance. Inspectors will want to be sure that your company can prove that it was, and still is, in compliance at all times.

Competency #3:

Act on regulatory updates in a timely manner.

Once the required changes to in-house standards and procedures are identified, the business should move quickly to implement the required changes, ensuring that old versions of documents are retired and replaced with the latest copies.

Again, it is quite likely that regulatory inspectors will identify audit trails and demand evidence of the company’s processes and systems that are used to track changes to regulations. They will also see that controls are in place to ensure that in-house standards and procedures are up-to-date and in alignment with the latest requirements, and that only the latest versions of in-house regulations are in use within the business.

Competency #4:

Provide training for all stakeholders to ensure company-wide compliance.

Ensuring that the standards and procedures in use by the business are up to date and aligned with the latest applicable regulatory requirements may not be enough to convince regulators that compliance requirements are being fully met.

To guarantee compliance, all stakeholders must be regularly trained in the use of standards and procedures in all settings in which they work. It is important to note that staff should be trained in ways that ensure that they appreciate not just the “how” of what they must do in order to work in a compliant manner, but also the “why” of what is being demanded by the appropriate regulations and the “who” of the person or persons that are ultimately responsible for ensuring compliance in each business process under consideration.

Competency #5:

Provide regulatory input before and during inspections to minimize the risks of future noncompliance.

The best businesses learn not only from their own mistakes but also the successes and failures of their competitors.

Indeed, some companies, rather than take a “lowest common denominator” approach to meeting multi-country compliance needs, may choose to implement a “higher than the highest denominator” strategy. In this way, they seek to not only set the highest standards for themselves, but at the same time position compliance as a competitive differentiator, maybe even influencing regulatory inspectors who see a higher level of compliance at play than at other companies, for example.

Regulatory staff should maintain a watchful eye over inspection reports, enforcement actions, and annual reports and compliance statistics published by regulatory agencies. Industry trade shows and conferences often feature valuable presentations by regulatory agency staff concerning current activities, trends, and information on the future direction of regulations.

These sources should be carefully analyzed for mistakes and corrective actions by other companies that can be applied to strengthen in-house standards and procedures and thereby minimize the chances of future compliance issues.

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