Table 1 depicts the foundations of such a risk assessment to determine the appropriate level of quality and technical requirements by including the two primary principles issued by ICH Q9 : (a) that the evaluation of the risk to quality could be based on scientific knowledge and ultimately link to the protection of the patient, and (b) that the level of effort, formality, and documentation of the quality risk management process could be commensurate with the level of risk.
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Supplier qualification should be completed before the pharmaceutical manufacturer reviews. The qualification relies on approval of the test results reported on the certificate of analysis or conformance and on at least one on-site identity test.
The general supplier approval procedure for key raw materials starts with the buyer, purchasing, or procurement department contacting the preselected supplier. An internal specification sheet is created and sent to the supplier for review and approval. Supplier assessment surveys, also known as paper audits, may also be sent to the supplier at this point. The supplier-completed questionnaire is then received by the company&#;s procurement and then quality departments. Suppliers may be required to provide samples (if first qualified), and the quality control lab tests those samples. The samples provided will be analyzed by quality control (QC) and reported to quality assurance (QA). If the results comply with the established specification, then QA may plan for an on-site supplier audit. An on-site supplier audit is planned and scheduled. If the on-site audit results are satisfactory, then the supplier is considered approved.
It is important to note that all steps mentioned may not apply to all key raw materials and may vary per company. As previously mentioned, the supplier qualification requirement should consider the risk classification of the material. Over the years, global companies have established minimum sup-plier qualification requirements including quality surveys, quality agreements, on-site audits, and technical support.
To determine if a supplier can meet expected quality requirements when supplying raw materials, a questionnaire may be used to gain information about the quality standards, regulations, certifications, or best practices applicable to the type of key raw material being supplied. Surveys should contain questions applicable to the approval of a particular supplier. While it is important to know that a supplier of key raw materials has appropriate quality systems and best practices while manufacturing key raw materials, the materials are not GMP regulated, and full adherence to the GMP regulations established for drugs, medical devices, or other GMP-regulated materials is not realistic. The best that can be expected is a key raw material being manufactured &#;at an FDA registered site&#; or &#;manufactured under a quality system that models a GMP-compliant quality system.&#;
Quality surveys are intended to provide a basic understanding of the supplier&#;s quality management system. Questions should be straight to the point and clear, and companies should be cautious about including questions unrelated to quality systems such as pricing, environmental health and safety practices, or product technical questions. Instead, other survey forms that focus on those business aspects can be sent separately. Because of proprietary and company confidential restrictions, many key raw suppliers may omit details when responding to survey questions that ask to &#;describe,&#; &#;explain,&#; or &#;attach a copy.&#; For the same reasons, a supplier may deny some information (e.g., highest education level achieved by an individual in a certain position) if irrelevant to quality systems.
In November , the FDA published the guidance Contract Manufacturing Arrangements for Drugs: Quality Agreements, which describes the agency&#;s current expectations for firms that outsource the production of drugs subject to current GMP regulations. This guidance has been the basis for quality agreements in the industry, even though it is focused on contract manufacturers instead of raw material suppliers. Nevertheless, the concepts in the guidance document could be applied in the quality agreement to establish the expectations between the contract giver (company) and contract acceptor (supplier). Several important aspects for quality agreements are discussed or recommended in the literature. , , ,
The following aspects must be clearly stated and agreed upon:
Common issues with quality agreements about key raw materials are that they often prohibit all changes without first obtaining the company&#;s consent. First, this type of broad prohibition exceeds the legal requirements applicable to medicinal drugs, which permit routine, non-major changes to be made without first notifying the FDA. By unduly restricting non-major process improvements, companies may substantially undermine the suppliers&#; ability to implement quality-improving, efficiency-generating, and cost-saving measures that, in the long run, benefit both parties.
Additionally, it is not logistically possible for suppliers of non-customized globally available key raw materials to contact every end user and request consent to proceed with a change. For example, if a key raw material supplier accepts a contract with excessive change notification requirements without review, this could eventually compromise the supplier&#;s ability to maintain compliance with the established quality agreement between both parties. On the other hand, suppliers must acknowledge the needs of GMP-regulated companies and avoid significant changes that affect product quality, fit, form, and function, which may impact the use of the key raw material by companies in validated manufacturing. When unavoidable, all efforts should be made to ensure that the company is notified in a timely fashion and provided sufficient information and product supply to address their validation concerns.
Table 2: Common concerns related to cleaning agents and other non-GMP-regulated key raw materials. Compliance Topic* Reference*This is not an all-inclusive list.
Quality agreements vary in their level of procedural specificity, and often the requirements are inconsistent with the supplier&#;s standard procedures. Some quality agreements may merely state that the supplier &#;has procedures&#; governing a particular area. Other companies may set forth detailed procedures that the supplier must implement for a particular area and these detailed requirements may create issues for key raw material suppliers. For example, the quality agreement may provide a three-year retention period for batch records, but the supplier&#;s normal procedure may call for a two-year retention period. In this example, although there may be nothing inherently unreasonable about retaining batch records for an additional year, the supplier may want to follow current policies instead of assuming the long-term cost of tailoring its procedures to accommodate a single customer.
Pharmaceutical manufacturers are responsible for auditing high- and moderate-risk suppliers, and these audits should be determined on a case-by-case basis. Where an audit is not deemed necessary, this should be justified appropriately, including with a formal risk assessment. When a supplier audit is indicated, it should be conducted by staff with adequate knowledge and training. A written plan for the audit should be prepared before the audit. After the audit, an audit report should record what was reviewed and any observations identified. The supplier should be expected to deliver a written response to any deficiencies, and these responses should be reviewed before the audit is closed. The resulting audit report can form the basis for the approval of the supplier.
The supplier should be re-audited at a specified frequency to verify ongoing performance. A rationale for the minimum audit frequencies for each supplier should be documented. The standard industry practice is every 3&#;5 years for non-GMP-regulated key raw materials. Even if the initial audit was on site, a desktop and/or questionnaire audit might be acceptable for re-audits if there have been no quality issues and the supplier has a good quality and compliance history.
The COVID-19 pandemic resulted in governments imposing temporary measures such as confinement, quarantine orders, and travel restrictions that are impacting GMP manufacturers in their capacities to perform on-site supplier inspections. Consequently, many drug manufacturers have adopted temporary measures such as performing virtual supplier audits to maintain compliance and supply of medicines to patients. The term &#;virtual audit&#; applies to inspections performed off-site using enhanced communication and information technology to fulfill a legal requirement of an on-site inspection. The only difference is that the inspector is not physically present. These audits may also be described as &#;remote&#; or as &#;distant inspections.&#;
The supplier&#;s ability to provide technical support is critical for the design, qualification, and monitoring stages of the process life cycle approach. For example, for cleaning agents used in validated cleaning applications, technical support could include laboratory testing for selecting the best cleaning agent and cleaning parameters, which saves time and resources during start-up or when trouble-shooting existing cleaning issues. Technical support should be available via calls, emails, teleconferences, webinars, and on-site support if needed. Technical literature may include the following, as applicable: material safety data sheet, certificate of manufacture/analysis, technical data sheets, technical tips, and laboratory reports.
A series of supply chain disasters&#;such as heparin, melamine, and nitrosamines contamination&#;has resulted in more pressure than ever for pharmaceutical manufacturers to develop better supplier qualification practices. Material management and supplier evaluation are key processes to avoid batch failures and adverse effects on patients. As a result, pharmaceutical manufacturers are demanding quality system compliance with adequate standards and increased information transparency from their suppliers. Some raw material suppliers require more provenance information from their suppliers, such as source, origin, and other essential information for traceability purposes.
Most FDA (or equivalent agency) guidance documents related to the subjects mentioned previously are applicable to medicinal products and their starting raw materials. However, key raw materials that are not purposely added to or in direct contact with the medicinal product may be beyond the scope of those documents. For that reason, requesting suppliers of key raw materials to make the product fully compliant with such guidance documents is not realistic. In some cases, compliance may not even be feasible due to the type of material.
The USP <467> Residual Solvents and USP <232> Elemental Impurities guidances are good examples to illustrate this issue. The first is a standard for the testing and potential reporting of residual solvents in pharmaceutical products. Residual solvent is defined as organic volatile chemicals that are used or produced in the manufacture of drug substances, excipients, or in the preparation of drug products. Similarly, elemental impurities specify limits for the number of elemental impurities in drug products. , These impurities include catalysts and environmental contaminants that may be present in drug substances, excipients, or drug products. These impurities may occur naturally, be added intentionally, or be introduced inadvertently.
These USP documents do not apply to key raw materials such as cleaning and germicidal agents used in drug manufacturing facilities because these types of items are intended to clean and disinfect surfaces. Some surfaces on which these cleaning agents are applied may also be in direct contact with drug products; however, residues are generally removed before the equipment is used. An effective and validated cleaning procedure will ensure that any potential for residuals from cleaning agents is not transferred over from the cleaning process into the next batch of drug product.
Even though key raw materials may be excluded from USP <467>, USP <232>, and other similar guidance documents, assessing the risk for potential contamination into the manufacturing process is still recommended. A better approach is to ask suppliers more pertinent questions as applicable to the material instead of requesting a declaration of compliance with these standards or guidance documents. Table 2 provides a list of common compliance topics and reference guidance documents with a suggested question for non-GMP-regulated key raw material suppliers.
Considering the regulatory challenges, it is important to have a deep understanding of key raw material suppliers when sourcing materials worldwide. Suppliers must be willing to provide the information needed for regulatory filings or other regulatory requirements, including materials not governed by GMP regulations. Favoring suppliers that can supply reliable and high-quality products ensures safe and effective drugs and makes good business sense.
The raw materials market is continuously impacted by factors including rising prices, limited supply and other uncertainties. This month, we posed a number of questions regarding these key topics to leading adhesives and chemicals suppliers and industry leaders; following are their responses.
Julie Vaughn Biege, global business development director, Emerald Performance Materials: Escalating raw material prices have been presenting significant headwinds in and are expected to continue to do so in the year ahead. We have focused on supply chain, terms and analytics tools to not only improve cash flow but better anticipate and stay on track with future projected margins. This disciplined approach has enabled us to invest in planned market-driven innovation, which will ultimately deliver on our strategic initiatives.
Peter Migchels, global sales development director, Kraton: Challenges for the chemicals industry included uncertainty around global demand fundamentals, the impact of tariffs and trade negotiations with China, ongoing inflation in transportation logistics costs, and natural forces. Like many of our peers with manufacturing sites along the Rhine River, we were affected by the unusually low water levels, which limited access to raw materials. To resolve this, we worked with our suppliers to arrange possible alternatives.
We were also impacted by Hurricane Michael, which caused one of our plants to sustain some damage. To mitigate the effect on our customers, we turned to existing inventories, as well as reproducing some materials at other Kraton facilities where possible.
James E. Swope, senior vice president, The ChemQuest Group and ChemQuest Technology Institute: Uncertainty. From tariffs to environmental crackdowns in China, uncertainty in supply&#;and in some cases, cost&#;reign.
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Biege: From a commercial perspective, we expect the tariff situation to resolve itself on a long-term basis. In the short term, the tariffs are a double-edged sword, and there is some protection due to existing contracts. Competitive imported goods are more expensive, which could benefit domestic production and sales, though the benefits may be dampened due to tariffs on imported raw materials. However, our company also exports a lot of finished goods, which makes U.S. goods more expensive.
Because we also produce goods in other regions, we have some flexibility in our supply chain planning to minimize the impact, such as exporting from Europe to Asia rather than from the U.S. to Asia. When it comes to infrastructure, we will be seeing some effect of increase in cost due to steel and aluminum tariffs as we plan for new equipment for expansions and maintenance in the coming year.
Migchels: As a specialty chemicals company offering polymers and chemicals worldwide, tariffs can impact the production of certain materials that are used in our manufacturing process, such as styrene-isoprene-styrene (SIS). We import isoprene from countries like China, as there is limited U.S. output of the monomer, which is a byproduct of ethylene production. A tariff on isoprene could allow foreign SIS producers, including those in China, to undercut our business as well as that of our peers.
In addition, the tariffs could decrease Chinese hydrocarbon and hydrogenated hydrocarbon resin exports into the U.S. This would mean a redistribution of those materials to Europe and Asia, making those markets even more competitive due to oversupply.
Swope: Fear of tariffs is greater than any true tariff effects so far, but the effect of the uncertainty and the damper on the entire business community is felt&#;and is often one of the first two topics to come up in conversation with business leaders.
Biege: Chemical industry innovation is usually driven by three major factors: regulations, performance and cost. The major segments for adhesives and sealants&#;packaging, construction and transportation&#;all have a number of factors driving innovation.
Increase in e-commerce, packaging design changes driven by changing consumer preferences, and regulations for food contact are creating new demands from OEMs for packaging adhesives, such as increased shelf life, lower cost, non-migratory materials, or sustainability goals. The circular economy is fast becoming the most discussed trend in the industry. Adhesives and sealants are believed to be a problem in end-of-life recycling of the product. There is a growing need for adhesives that do not impede/burden recycling (e.g. in paper recycling or the cleaning and reuse of returnable glass bottles).
In automotive applications, trends such as lightweighting and NVH (noise, vibration and harshness) reduction favor increasing usage of adhesives; for example, in structural bonding of BIW (body in white) shell parts, etc. Tougher structural adhesives to replace metal fasteners, along with compatibility and adherence with newer structural material choices, all fuel the need for newer, improved raw materials.
While sustainability remains a key tagline with most of the manufacturers, the willingness to pay for it is still low, unless driven by regulation or green accreditation incentives. There is still a lot of potential to promote sustainability as a differentiated value proposition by adhesives and sealants producers and OEMs. In the world of constantly changing regulations and increased scrutiny of raw materials, innovation that targets safe and sustainable solutions at competitive cost and performance could be game changing.
Migchels: Sustainability is an integral part of driving innovation. The adhesives industry, in particular, continuously looks to develop products that are safer, lighter and cleaner. As consumers and governments worldwide demand higher levels of sustainability, chemical producers are looking for ways to make products that are safer to use with less environmental impact.
Furthermore, as new types of substrates are produced&#;particularly in the automotive industry&#;they become more difficult to stick to. So it is important that suppliers deliver solutions that enable the development of tape and label adhesives that stick to those surfaces while withstanding harsh conditions, such as extremely hot or cold weather.
Swope: Supply chain issues mentioned previously are blocking much of the planned innovation work. R&D efforts have often been redirected to validating alternate vendors. Sustainability is still the biggest focus, with bio-based materials being a subset.
What we hear from our client base is a great deal of confusion regarding the definition of sustainable, so implementation of sustainable programs takes on individual company interpretations. For some, it involves sourcing more bio-based materials. For others, it is the total environmental impact, cradle to cradle. Others focus on practical aspects of the market, such as volatile organic compound (VOC) compliance or LEED acceptability. Nanomaterials are still confusing to most relative to the risks and value proposition. Most nanomaterials carry a significant price premium that is hard to translate into formulated product value.
Biege: Raw material suppliers will continue to face challenges with increased costs and tariffs. Evolving regulations, scrutiny for health hazards, and environmental factors present both opportunities and threats. Overall, the average consumer continues to be much more aware of &#;green&#; issues, though there is a gap in accurate scientific information being widely available and understood by the public vs. the misinformation that abounds on the internet.
The shift to increased e-commerce impacts the quantity and type of packaging, as consumers increasingly order a host of goods and groceries online. This exacerbates the desire to make improvements in recycling and product life cycle, driving toward a more effective circular economy.
Further, major players in the consumer supply chain, such as Walmart, Target and others, are taking serious steps to eliminate certain chemicals of concern (e.g., formaldehyde donors, certain phthalates) from the products they offer on their shelves. Suppliers need continuous innovation processes to effectively partner with others in the supply chain, enabling them to adapt products to these types of market drivers and needs.
Migchels: One of the impacts of the increasing demand for sustainability is more stringent regulations. This means suppliers must commit to keeping up with the pace of regulatory changes and help customers do the same.
To meet this need, we have a dedicated regulatory team that monitors for global industry regulations. This enables us to stay ahead of initiatives or programs that can affect our business or our customers. We also collaborate closely with customers to understand their specific needs and how current or future regulations can impact their ability to go to market.
Swope: While domestic regulation has eased some for U.S.-based entities, regulations in other countries are increasing. Europe still functions as a bellwether for sustainable technology. China-based issues like regulation and tariffs are increasing talk about other investment arenas in Southeast Asia and India. Overall, this is a very good time for the industry, as technology advances drive change in materials and methods of assembly while infrastructure decay presents a latent opportunity for refurbishment and increasing life cycles of assets. ASI
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