5 minute read

As consumer goods companies are dealing with increasing regulatory requirements, market fragmentation, risk, and demand for late-stage product customization, they are extending their reliance on external suppliers to help bring products to market. With short lead times and high SKU proliferation, the production environment is already complex for these external packagers and manufacturers, but within the heavily regulated pharmaceutical and healthcare market, the burden of proof is even higher.

Those who are able to demonstrate proper product handling within regulated industries stand to profit from double-digit industry growth. Growth in contract packaging is largely being driven by the pharmaceutical and healthcare market. The sector is expanding at around 15% per year, a trend which is expected to continue at least through 2021.

“We are seeing business growth with our Rx pharmaceutical customers, so staying compliant with pharma regulations, particularly Part 11 regulations, is a huge mandate for us,” says Jennifer Squillante, Quality Manager at Unette, a contract manufacturing company.

Anyone hoping to profit from that growth has their work cut out. The packaging of pharmaceutical and healthcare products involves more responsibility than ever. A plethora of regulations, compliance protocols, warning labels, protection standards, and security requirements places a tremendous burden on contract packagers.

A survey by the Contract Packaging Association revealed that 70% of contract packaging and contract manufacturing companies are concerned that the regulatory environment could negatively impact business in the coming years.

Those looking to stay ahead of the evolving regulations must stay diligent. “We are regulated by the FDA and the DEA, and as such, we are always reviewing new white papers and guidelines to continuously improve our processes,” comments Sarah Faison, Director of Sales & Marketing at Praxis, contract packager to pharmaceuticals and health and beauty brands.

On top of heightened regulatory control, brand customers are demanding a more agile supply chain to drive out costs in response to tighter margins. They expect suppliers to harness sophisticated quality control and compliance systems. There is no longer any room for manual processes, delays in information relay, or general supply chain inefficiency.

How are successful contract packers and manufacturers rising to the challenge? Here are some of the ways they are coping with burgeoning requirements and gaining ground in these fields:

Following GMP

Good Manufacturing Practice (GMP) guidelines from the FDA encompass the manufacture, processing, and packaging, as well as any other activity that could impact product quality or safety. The goal of GMP is to ensure that products are consistently produced and controlled according to quality standards. Those following these practices minimize production risks that can’t be eliminated through testing of the final product. They cover raw materials, premises, equipment, software, training, personal hygiene, and more. It also lays out detailed record keeping for every aspect of manufacturing, packaging, storage, and product delivery. Contract packagers are advised to adopt software with workflows that adhere to GMP and other industry standards.

“To stay on top of the evolving compliance and quality requirements, I regularly visit the ORA FOIA Electronic Reading Room to avoid pitfalls of other companies have fallen victim to,” remarks Squillante. “I also subscribe to FDA electronic notifications — MedWatch, Cosmetic and Dietary Supplement news and such — so that when there are changes or issues we need to be aware of in the industry, I can immediately take action.”

Electronic Records

Rules are being strictly enforced in the U.S., Europe, and around the globe concerning Electronic Record and Signatures (ERES). Electronic records must demonstrate that manufactured product data is electronically captured, manipulated, extracted, and coded precisely. A complete audit trail must exist. Electronic signatures must be carefully managed. All modifications, deletions, or transmissions of ERES data must be recorded and managed responsibility. Business applications used by contract packagers should seamlessly address EREC requirements.

“We have been operating our legacy system for many years, and migrating towards Nulogy’s electronic signatures, and mobile devices, has been a paradigm shift as our team was used to pen and paper recording,” says Squillante. “There is a challenge in helping our employees embrace the change of an electronic system rather than a paper-based system. There is also a challenge in purchasing a service from a third party to control our electronic records, in that the burden of proof is on our company, as the end user, to ensure that the product was designed and developed in compliance with 21 CFR part 11.”

Automated Batch Records

The sheer volume of electronic data handled by contract suppliers necessitates the creation of batch records. Contract packagers in regulated industries must demonstrate the proper handling of consumer products via batch records. This can be a tedious and error-prone process if done manually. Faced with short lead times, high SKU proliferation, and growing complexity, contract packagers in healthcare and pharmaceuticals are realize the importance of digitizing and automating the creation of batch records. They need systems that auto-populate critical product information into the batch records as part of ongoing operations. Information is extracted directly from the production environment, providing evidence of safe product handling. Manual data entry is eliminated along with associated risks.

End-to-End Traceability

Many systems do a good job of recording transactions, signatures, and electronic records. The weak links, however, are the individual touch points that data passes through as part of the compliance and supervisory process, and those places where data is moved from one system to another. In response, many contract packers and manufacturers are gravitating toward systems that offer digital quality checks and seamless digital sign-offs. With the right product information received at the correct touch points and all the data flowing through one system, accountability is guaranteed.

The Time is Now

The time has passed when contract packagers and manufacturers could survive by clinging to traditional paper-based or home-grown systems. Their environment has become one characterized by short production runs, shrinking lead times, and high SKU proliferation, where automation is needed to stay agile. Software solutions must make compliance quick and easy by providing audit trails, automated batch records, electronic signatures, and a quality control workflow that’s integrated within the production environment. The ability to harness technology to stay agile and fulfill orders on-time, in-full, and without compromising on quality will determine the winners and losers.

Jason is a co-founder, CEO and brand ambassador for Nulogy. He is focused on corporate development, executive leadership, and understanding the evolving landscape of Nulogy’s clients. He is also on Nulogy’s board and speaks throughout the industry on the agile supply chain.


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Nov 19, 2018

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