PDA Letter Article

Creating a Global Incentive for Pharma

by Anders Vinther, Sanofi Pasteur; Emma Ramnarine, Genentech; co-chairs PDA Post Approval Change: Innovation for Availability of Medicines (PAC iAM) Task Force

A Roadmap to Avoid Drug Shortages

The enterprise that does not innovate inevitably ages and declines. And in a period of rapid change such as the present, the decline will be fast. – Peter Drucker

Innovation in the pharmaceutical industry is no longer simply a means to gain competitive advantage—it has become a necessity for survival and growth. Manufacturers, regulators, policymakers, politicians, patients—everyone sees the need and value of innovation to improve products and processes. Only by encouraging and adopting innovative manufacturing practices can an uninterrupted supply of drug product possibly exist (1). Yet, there is no incentive to innovate globally because, to quote former U.S. Treasury Secretary Henry Paulson, “regulations need to catch up with innovation.” In fact, the current global regulatory complexity serves to create the exact opposite motivation, that is, to maintain the status quo.

Why is this the case? What is holding us back from innovating our manufacturing processes?

During the commercial life of a marketed product, changes—post-approval changes or PACs—are typically needed. Those changes may drive process improvements, address manufacturing and quality issues, enhance analytical method capabilities, or effect other advancements. Most PACs that drive innovation or continuous improvement in the pharmaceutical industry, however, require a regulatory submission to be filed in and approved by each country where the product is registered before the change can be implemented. For a globally registered product, this could mean filing for approval in over 100 countries—one at a time!


This would not be a challenge if all countries had the same documentation, approval requirements, and approval timelines. But this is not the case. A single change made today commonly takes up to five years to be approved globally. And until the change is approved by each country, manufacturers must maintain parallel inventories of the product, manufactured both with and without the change. Due to the need to make multiple changes each year, as well as the time involved in obtaining approvals for each change, the cost can become prohibitive and the logistics staggering.

As a consequence, “current” means something quite different to the pharmaceutical industry than it does to other industries known for innovative practices; advances that take pharma five years to accomplish, those other industries can achieve in weeks or months. In the time it takes our industry to implement a global change, the “new” technology may no longer be current. With each change possibly requiring 100 individual approvals, it’s not difficult to see why manufacturers decide not to innovate. The result over time is aging facilities, failing equipment, and dated processes. And this leads to the potential for drug shortages as the manufacturing quality problems that cause shortages are more frequent in older sites (1).

So, how can we encourage innovation?

We believe creating an environment for innovation requires three components: changing the timescale of being current, increasing global trust based on science, and shifting a company’s risk appetite.

Current should not be five years. At most, it should take a few months to implement a global change, just as it does for many other industries. The only way to reach that goal is to reduce the number of individual assessments required for each PAC. Common global standards are desperately needed for pharma to move ahead—at best, one global approval per PAC, or as an alternative, one approval per region. In fact, this model is already applied in the European Union. WHO has developed PAC assessment and regulatory reliance standards based on sound science and risk concepts that could be applied immediately around the globe. It just requires trust among global regulators. So, what will it take for other regulatory bodies to start trusting each other enough to eliminate the need for individual country approvals? Regulators expect a company to apply the same standards to all of its manufacturing sites globally. Is it really unreasonable for industry to expect regulatory authorities to apply the same standards globally as well?

Many PACs aim to address an issue or drive much-needed improvements to processes, technologies, and methods. When data indicate that the “post-change” situation is better than the “pre-change,” a company should be allowed to implement a change without waiting years to receive individual country approval. This, of course, requires companies to earn the trust of regulators. In our view, manufacturers that have an effective quality system, apply risk management, demonstrate good quality performance, and rely on comprehensive self-reporting and self-identification systems should be granted less regulatory oversight. Once companies have earned this trust from regulators, regulators can reduce their regulatory oversight control which, in turn, encourages innovation and faster changes. This concept is not new. The opportunity for reduced regulatory burden is already described in ICH Q10: Pharmaceutical Quality System and in Annex 1: Manufacture of Sterile Medicinal Products of the EU GMP guidelines. And this leads us to our last point: a shift in risk appetite.

Innovation, by its very nature, requires a higher appetite for risk. The principles of quality risk management described in ICH Q9: Quality Risk Management have existed for 12 years in the pharma industry, yet they are not being applied effectively to manage PACs. To enable innovation, there needs to be a shift in risk appetite—for both industry and regulators. Current risk tolerance is so low that even when sound science and risk management practices demonstrate no increased risk to product quality or patient safety companies choose to delay a change, accepting the risk of drug shortages. This equation must shift towards a higher risk appetite for innovation and a lower risk tolerance for shortages.

If we change the timescale of being current, increase global trust based on science, and shift our risk appetite in favor of innovation, we will address our current challenges of drug shortages. In our view the roadmap is clear, but are we ready?

You can't solve a problem on the same level that it was created. You have to rise above it to the next level. – Albert Einstein


  1. Vinther, A. “Drug Shortage is a ‘Wicked Problem.’” PDA Letter (May 4, 2016).