CMC restructuring: the regulatory implications

A case for on-site presence and the value of face-to-face time

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Pharma IQ
Pharma IQ
09/28/2018

chemical manufacturing

High levels of life sciences industry consolidation present companies with a chance to rethink the ownership and management of manufacturing activities. Yet it is easy to underestimate the planning requirement during operational restructuring, not least around regulatory activities.

Drawing on Kinapse’s experience of helping numerous companies navigate these practical intricacies of manufacturing site consolidation, the company’s Senior CMC Manager, Niamh Panesar, sets out some critical success factors...


Continued high levels of industry churn through mergers, acquisitions and portfolio swaps, added to the perpetual need to keep operations lean and cost-efficient, creating an ongoing need to streamline life sciences manufacturing operations. Operational reviews also provide a chance to increase capacity or rethink ownership.

Yet in operational restructuring, it is easy to underestimate the planning requirement, especially in relation to legal, technical and regulatory activities. Regulatory Affairs departments, in particular their post-approval chemistry manufacturing and controls (CMC) groups, will have so many other priorities vying for their attention that they may lack the capacity to assess and manage the regulatory implications of site transfers to the degree that is needed. 

As commercial decisions are made, it is crucial not to neglect the importance of promptly re-registering products (e.g. in line with a change in location) for instance and the associated regulatory submission workload. If this activity is not built into plans and costings, firms could risk gaps in supply.

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A checklist of practical considerations should include the following:

  • Scoping the regulatory requirements
  • Maintaining lines of communication
  • Driving operational improvements via data analytics
  • Resource & cost measurement
  • Compliance & risk considerations

Now let us take a look at each of these in detail.

  1. Scoping the regulatory requirements

    Prioritization and project management are critical to ensure that regulatory considerations are appropriately scoped and planned. Organizations should ideally take a strategic and holistic view of these - rather than bring in external resources on a tactical basis, e.g. solely to prepare and process submissions documents. By engaging a more complete and proactive service companies will benefit from a deeper level of support from experienced practitioners who will ask the right questions.

    Making the Regulatory partner part of the strategy development process, and embedding them within the internal team, is advisable too. As experienced experts, they will be adept in assessing the regulatory impact of new site planning - the mitigations and specific input that will be required (e.g. redaction of commercially sensitive information during document preparation). Where product lines are transferred to a contract manufacturer, there are likely to be additional considerations due to differences in standard operating procedures and quality management systems.  Where the team tasked with preparing regulatory filings, and managing these through to authorization, must deal with a third party, such factors will need to be accounted for in the overall planning and costing.

    As it can be harder to influence contracted manufacturers’ timelines, there is a risk that this kind of arrangement could result in unforeseen delays in completing and filing updated registrations. Before long, the scale of submissions could expose a company to tens of millions of dollars in lost revenues if approvals are not achieved in time.

  1. Maintaining lines of communication

    Among the common sources of project breakdowns and failed delivery are fragmented processes and a poor line of sight across the end-to-end process and functional teams. Those responsible for executing registrations should, where possible, interact directly with commercial teams and in-country representatives, and have access to the submission strategy as well as the execution plan. This can lead to better-optimized capacity and cost efficiencies, e.g. through the ability to blend different service/cost models, and the ability to drive continuous improvement based on what has worked well elsewhere.

    Another clear advantage of having a service team embedded in the organization – especially if the provider also manages other outsourced services, such as broader regulatory outsourcing, medical writing, document redaction, pharmacovigilance activities and more – is that they will have developed a rounded, fuller knowledge of the company’s products. This in turn can provide scope for more holistic advice about potential risk factors or scope for greater efficiency improvements.

  1. Driving operational improvements via data analytics

    As part of delivering an effective regulatory service to support site rationalization, the service partner can be expected to track requirements, processes and performance to ensure success. As part of this process, they will uncover new data insights which could help drive additional operational improvements and further reduce risk. Armed with this insight, both parties can decide on a positive course of action. Indeed, a regulatory intelligence capability can help reposition the Regulatory element of site consolidation as a business contributor – very appealing to budget controllers.

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    The option to apply innovative tools and technology aids to automate some aspects of labor-intensive Regulatory administration is another service facet worth looking out for – assuming the business is willing to co-invest in their use. This could prove a further source of cost and productivity improvement.

  1. Resource & cost measurement

    When drawing on external help with Regulatory activities, companies are likely to be offered a choice of service options.  In defining the operating model and assignment of responsibility (RACI matrix) there are a range of factors to consider. These include the company’s own internal capacity, volume forecasting, product and market prioritization, maturity and expertise of the service provider team, blend of off-shore / on-shore teams, and so on.

    Accuracy of measurement will be important too, in estimating regulatory workloads. A service provider with experience of creating and managing high volumes of regulatory submissions across a broad client base should be able to say with confidence what makes for a relatively straightforward or complex workload. This in turn will enable granular, tiered billing. Looking for the ability of the regulatory service provider to break submissions down into constituent tasks, for even greater accuracy in estimating resources and costs, is worth companies’ while. If the partner is able to bring into play a computational framework for calculating all of this, so much the better. This will help avoid any bias.

  1. Compliance & risk considerations

    Unless regulatory compliance is at the forefront of site consolidation planning, any savings gained from the operational reorganization could be lost in the resulting risks to the supply pipeline. The regulatory intelligence built up as part of the managed regulatory service delivery should help avert this. If, in the process of scoping the regulatory implications of the site transfer, the service provider’s team uncovers outdated product information, for instance, the ability to act on this before new stock is shipped could help head off a potential crisis. Ideally, the managed service partner will have a robust methodology for surfacing and managing scenarios like this, and limiting any exposure to the risk of non-compliance.

Beware cutting corners

Finally, it can be all too easy to unwittingly sacrifice control and quality in the pursuit of the economies of offshore service delivery for regulatory process management, especially if the business’s primary motivation for the restructuring is to strip costs from operations. A safer and more balanced option may be for companies to blend offshore or near-shore cost efficiencies with direct local control over delivery and service quality. Certainly, companies should build in the scope for at least some on-site presence and face-to-face time as these complex and interconnected change processes unfold.

Manufacturing site consolidation: scoping and managing the regulatory implications: a Kinapse best practice guide for global life sciences firms is available to download at kinapse.com