27-03-2019
KPMG’s report explores practices and attitudes to label updates in the pharmaceutical industry.
Refining relabeling of pharmaceuticals
Patient safety is at the heart of drug development and licensing processes. But the duty of care does not stop at launch. Manufacturers must satisfy strict regulatory demands throughout a product’s lifecycle, including re-labeling. How can they ensure current safety information at a reasonable cost?
Although the way the pharmaceutical industry operates is changing, its duty of care towards patients and consumers remains paramount. There are emergency mechanisms in place to recall or rapidly re-label products in the rare instances that an urgent Safety Label Change (SLC) is required, but any other need to communicate new dosage regimes or side effects are the responsibility of the manufacturer. Outdated labels can compromise patient safety, harm the organization’s reputation and add significant costs of destroying excessive quantities of old packaging.
KPMG’s recent report Investing in patient safety explores practices and attitudes to label updates in the pharmaceutical industry. Benchmarking provides insights and perspectives for organizations as they strive to meet their duty of care while managing the financial aspects of SLCs.
Martin Rohrbach
Partner, Head Internal Audit, Risk and Compliance Services (IARCS), Sector Head Life Sciences
KPMG Switzerland
Complex supply chains
One of the main challenges in SLC management and implementation is the large number of stakeholders in today’s increasingly complex supply chains. Efforts to communicate and track changes and actions are often thwarted by the large number of incompatible systems at play. Numerous organizations are currently implementing or at least considering transformation projects designed to align systems and interfaces. The significant upfront investment will pay off in the long run by removing system incompatibility and empowering information exchange – an important prerequisite for rapid and cost-effective re-labeling.
Regional regulatory
Another challenge for international operators is the need to observe the specific licensing requirements of each country individually. In Switzerland, for example, Swissmedic is responsible for the authorization and supervision of therapeutic products, including medical labeling. Products marketed in Switzerland require safety labels in German, French and Italian so any updates must be reflected consistently throughout the language versions.
Changing processes
Since all products are manufactured based on forecast demand, an SLC disrupts the manufacturing cycle by shifting timelines and priorities. Some companies also try to anticipate SLCs and alter their supply accordingly, notwithstanding limitations on the minimum order quantity for efficient manufacturing. Of course, SLCs are not always predictable and an industry so focused on patient care cannot afford to leave markets understocked.
Once a newly labeled batch can be sent to market, the excess inventory is either destroyed immediately or allowed to be used for a period of time agreed by the company and market. In either scenario, the manufacturer faces substantial cost in terms of write-offs.
Optimized planning and processes, including close coordination between the regulatory affairs and manufacturing teams, help reduce costs by enabling rapid response when an issue is identified. Process optimization and the use of high-speed packaging would also enable agility and flexibility by eliminating minimum order size.
Efficiency step by step
Efficiency gains in our increasingly digitalized worlds are welcome not only in terms of cost but also speed at which patients are informed of updated advice. A practical and inexpensive solution could be a warning or educational message on the front cover of all boxes reminding consumers to check online for the latest information. As a standalone measure, it’s unlikely to satisfy the regulatory authorities. However, it would be an important step towards safeguarding patient safety and improving outcomes, which has to remain the priority. In the longer-term, electronic inserts might be updated automatically at minimal cost.
Outlook
As technology advances, companies should consider innovative approaches to improve patient safety further. For instance, blockchain technology applied to the pharmaceutical industry could address inefficiencies in the way labels are updated and tracked across the supply chain. It could also help combat drug counterfeiting by tracking and tracing batches beyond doubt. Organizations should also explore data-driven and automated process tools to improve efficiency and cut costs in re-labeling – and along the entire supply chain.