Quality Systems Roadmap
Quality Systems Roadmap
Quality Systems Roadmap
www.pwc.in
Foreword by CII
The Indian pharmaceutical industry has emerged as a significant part of the manufacturing and export
sectors of the country. Aligned with the Make in India vision, it is undergoing remarkable change and
adapting to the shifting dynamics of global consumer markets. As a sector which directly impacts health and
well-being, the quality of products is of utmost importance.
The pharmaceutical industry is aware of the increased regulatory focus on quality. Over time, with increased
regulatory scrutiny, quality has moved from the fringes of Indian pharmaceutical strategy to the very centre.
The quality focus is increasingly going beyond regulatory compliance to all-time readiness, a critical pivot that
will enable India to build on its global leadership in pharmaceutical manufacturing.
This report provides a roadmap for Indian pharmaceutical companies to capture opportunities for enhancing
quality outcomes in manufacturing. The report aims to define the actions needed from all stakeholders,
including the government, regulators, industry and academia, to strengthen and build India’s quality
attainments in the pharmaceutical industry.
I am confident that this report will prove to be a useful guide for the different stakeholders in the
pharmaceutical ecosystem and will help the industry to create a new quality vision that will further drive its
growth as a global leader.
Chandrajit Banerjee
Director General CII
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Quality systems roadmap 3
Foreword by CII National
Committee on Pharmaceuticals
Despite being the largest provider of generic drugs globally, the Indian pharmaceutical industry is highly
fragmented, with varying degrees of capabilities. It comprises big players who are compliant with multiple
global regulatory standards such as those of the USFDA and MHRA, along with a large number of small
players who are still struggling with Schedule M compliance.
Though significant efforts have been taken to get the ‘process’ right and achieve parity with the best
manufacturing practices observed in other sectors, the Indian pharmaceutical industry still has a long way
to go in order to meet global standards on the whole.The industry has already started showing signs of
considering quality as an important bottom line driver.
This is an intermediate step in the evolution of industry manufacturing systems and business models where
quality becomes a revenue driver.With a little hand-holding of smaller players to achieve compliance,
policy support from the government, and an emphasis from leaders on quality to trigger a cultural change
in organisations, India can unlock its potential to achieve the pharma vision of becoming a global leader in
end-to-end drug manufacturing. In the ever-evolving pharmaceutical landscape, investment in quality brings
excellent return on investment. This report strongly advocates that quality is no longer an expenditure that
companies incur to procure a licence in order to be in the business but is a way of life that drives revenues
and separates winners from losers. It has direct imperatives on a company’s margins, brand image, working
capital and return profile.
I thank PwC for collaborating with CII and participating in shaping the roadmap to achieve Quality Vision
2020. I am also thankful to all members of the CII National Committee on Pharmaceuticals 2017-18 for their
valuable contributions to this report.
Dr. Rajiv I Modi
Chairman, CII National Committee on Pharmaceuticals
Chairman and Managing Director, Cadila Pharmaceuticals
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Foreword by PwC
‘What got us here will not take us there’ would be an apt maxim to describe the current dilemma that the
Indian pharmaceutical sector is grappling with. The Indian pharmaceutical industry has shown tremendous
growth over the last two decades—graduating from manufacturing API for the domestic market to API and
subsequently formulations for developed markets. While the shift to manufacture specialty products for
developed markets is ongoing, pharma companies continue to struggle with regulatory issues.
Data from FDA presentations and citations show an increased shift in the regulator’s stance from a compliance-
centric to a risk-based approach in assessing quality readiness. ‘Process’-related shortfalls have been the fastest
growing citation bucket in FDA 483 observations over the last four years. Ongoing harmonisation among global
regulators compounds the issue as quality shortfalls at manufacturing sites get shared internationally. Against
this backdrop of rising regulatory oversight, the importance of quality as a risk mitigator gets amplified.
India needs to accelerate infrastructure upgrade, shift the weight of quality from getting the product right to
getting the process right consistently, invest in building capabilities to make quality culture a ‘way of life’, and
match the global regulatory standards to gain leadership in end-to-end drug manufacture.
Quality focus is no longer a matter of hygiene but a clear competitive edge that companies will leverage to gain
and retain market share at enviable profitability. Procrastination may cost us the next decade.
Sujay Shetty
PwC India Partner and Health Industries Leader
Pharma and Life Sciences Leader – Asia Pacific
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Summary
• The Indian pharmaceutical industry has shown • The ‘Pharma Vision 2020’ of the government’s Department
tremendous growth over the last two decades—graduating of Pharmaceuticals aims to make India a major hub for
from manufacturing API for the local market to API and end-to-end drug discovery.
subsequently formulations for developed markets. • CII and PwC joined hands to conduct a survey of
• While the shift to manufacture specialty products for senior quality leaders to identify the roadmap that
developed markets is under way, pharma companies still the stakeholders should follow to achieve ‘Pharma
struggle with regulatory issues. Vision 2020’.
• In the background, regulators across the globe are shifting • This roadmap aspires to serve as a guideline along which
their stance from compliance-based to risk-based audits the Indian pharmaceutical industry can design and
along with sharing of information to drive harmonisation; benchmark its progress. We break this migration into the
however, there is much ground to be covered on this goal. following buckets:
• Since quality mitigates risk, manufacturers that embrace
quality as their key driver stand to benefit significantly.
This requires organisation-wide change and process
re-engineering but the payoff is material enough to pursue
this investment.
Infrastructure • Ensure availability of quality infrastructure (e.g. power, raw water, connectivity for pharma hubs).
‘Aggressive augmentation of • Establish academia and industry interface to update curriculum and establish avenues for imparting
current infrastructure and human basic domain experience to pharma graduates and diploma holders.
capital capacity building’ • Encourage learning and development investment in all pharma mega parks.
Operations • Simplify and harmonise SOPs across the industry to reduce training time, save cost and increase
‘Quality-focused reengineering compliance.
of manufacturing process and a • Implement a hands-on training programme such as on the job training (OJT) to improve the compre-
unified view of supply chain’ hension of followers.
• Leverage automation, big data and the cloud to achieve full transparency of data across suppliers,
manufactures and channels.
• Increase R&D effort through government, academia and industry collaboration; also encourage smaller
pharma firms to engage in the same.
• Safeguard domestic bulk drug and API manufacturing against cheap imports; provide impetus for the
CRAMS and CRO sector.
Regulation • Aim for global alignment of the regulatory expectations and perspectives and help the industry
‘Regulatory agencies to create a develop common knowledge.
level playing field’ • Train inspectors in Indian FDA to achieve parity with US standards.
• Participate in the drive for global harmonisation of regulations.
• Harmonise inspection and enforcement across firms of all size in India and abroad.
• Articulate a clear glide path to achieve WHO compliance with adequate hand-holding.
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India aspires to be a global leader in
the pharmaceutical industry…
• The Indian pharmaceutical industry was worth 20 billion • The Government of India plans to set up a 640 million
USD in 2015 and is expected to expand at a compound USD venture capital fund to boost drug discovery
annual growth rate (CAGR) of 15.92% to 55 billion USD investments and strengthen pharmaceutical infrastructure
by 2020.1 to help the industry achieve global leadership in pharma
manufacturing.2
3rd 10% • Both MNCs and local companies continue to make
Rank of India by Volume share significant investments in the manufacturing for:
volume of pharma of world’s total −− Captive plants by export markets
production pharma output −− Same plant to supply to different export markets
• Indian drugs are exported to more than 200 countries,
1 st
3 rd which accounts for around 50% of its revenues. The US is
its biggest export market.3
India’s rank in India’s rank in • Exports still remain a key growth driver as India aspires to
global generic production of be a global leader in 2020.
exports APIs and dosage
−− India is expected to rank amongst the top three
formulations
pharmaceutical markets in terms of incremental growth
• Indian pharma growth is a culmination of three decades by 2020.
interspersed with two key pivots. −− Pharmaceutical exports from India were worth 16.84
• The industry is now in the midst of the third pivot by billion USD in 2016–17, and are expected to reach
getting ready with a pipeline of specialty drugs for 20 billion USD by 2020.
developed markets. Percentage of pharma exports in USD (2014–15)
US
28%
−− NAFDAC (Nigeria)
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• However, there is still scope for improvement:
• Major discrepancies arise due to failure to • Drive quality culture through a holistic approach to
thoroughly investigate and review records. execution
• Procedures are lacking detail or are overly • Simplification and harmonisation of procedures to
complicated and hence not fully followed. enable ease of execution; effective training
12%
21%
Laboratory controls
12%
Organisation and
personnel
Production and
19% process controls
18%
Records and reports
Equipment
19%
Others
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Shift of regulatory stance – going
beyond compliance
Three major trends are shaping the regulatory stance in
pharma manufacturing:
A. Shift from compliance-based to risk-based audits
B. Use of quality data to make informed decisions
C. Collaboration across regulatory agencies
Initiative Description
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Shift of regulatory stance – regulatory
collaboration
C. Collaboration across regulatory agencies
• Regulatory collaboration to exchange information under
confidentiality agreements benefits all stakeholders.
Regulatory collaboration
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Quality vision
Vision 2020 – Global leader in end-to-end drug manufacture
• The clarion call for the industry is to achieve ‘peak performance’ across
the key pillars for it to record sales worth 55 billion USD by 2020. Every
stakeholder of the pharma ecosystem—the government, regulators, and
the industry—needs to come together and voluntarily cut down slack to
power the industry’s next leap.
Pillars
1. Infrastructure • Shortage of NABL • Strict enforcement of NABL • Enhanced network of NABL labs
accredited labs accredition • Acceleration of infrastructure
• Inadequate infrastructure • Cluster development with development
(water, power) common facilities such as
Infrastructure
3. Product • Insufficient R&D spending • Collaborative research by • Incentives for R&D to encourage
development • Low penetration of concepts academia and industry innovation
like QbD, design space, CtQ • Policy support for SMEs to • Adoption of Six Sigma process
and CPP invest in R&D capabilities
• Prioritisation of time to • Use of technology for
launch over robust process in-depth process and analytical
development understanding
4. Manufacturing • Excessive focus on production • Process optimisation to • Big data and cloud used for
throughput and volume cut costs process optimisation
• Complicated SOPs that increase • Simplification of SOPs and • Harmonisation of general SOPs
compliance burden practical training (OJT) across the industry
• Basic level of process deployment • Technology-enabled
measurement done manually • Automation-enabled process dashboards to do away with
Operations
5. Supply chain • Highly fragmented supply • Tighter quality control over • Policy support such as minimum
management chain –quality control outside of imported bulk drugs and import price for
manufacturing unit is difficult intermediates bulk drugs
• Multiple pain points such as • Full data transparency • Benchmarking with best in class
quality issues with suppliers, across supplier, manufacturer procurement industries through
different regulatory requirements and channel technology-enabled processes
across export markets, poor • Clearly defined logistics • Development of specialist
technology penetration, requirement with active control logistics providers with
unequipped distribution network over service providers end-to-end capabilities
and infrastructural gaps • 24x7 logistic operations through
schemes like Bharat Mala
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Current state Future state
6. Quality unit • Quality unit is a compliance- • A better trained organisation that • Quality capabilities are
capability centric reactive unit that uses global best practices and well distributed from the
operates on the philosophy of ‘fix anticipates potential risks operating to leadership level
Capability and culture
10. Regulatory • Inspections still focus on • Product-centric approach through • Rewards for continued
inspection compliance adherence quality index and risk rankings quality adherence by
• Irregular audit of NABLs and long • Gradual reduction in inspection decreasing the frequency
approval timelines raise quality rigour for those who demonstrate and duration of inspections
concerns and slow down the adherence to quality metrics • Mandatory bioavailability
entire supply chain • Regular annual audit of labs and bio-equivalence tests
for all drug manufacturing
permissions
11. Global • Global regulations continue to • Active collaboration to achieve • Regulation amendments to
regulatory become more complex and global harmonisation (MD-SAP, encourage innovation and
landscape difficult to comply with FDA/MHRA, Q12, PIC/S) continuous improvement
• Regulatory skill-building efforts are • MoU with the USFDA and the • Capacity augmentation to
picking up speed UK’s MHRA to cross-pollinate conduct annual inspections
best audit practices by augmenting inspector
counts and upgrading
their skills
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Actions to achieve the vision
The government
Short term Long term
• Accelerate the Cluster Development programme unveiled in the • Continue acceleration in infrastructure development, especially
Make in India initiative for creation of common facilities such in the areas of water and power generation.
Infrastructure
• Provide fiscal incentives and tax sops to small and medium • Incentivise R&D by strong IPR and legally enforceable out-
enterprises in order to stimulate investments in innovations licensing contracts for innovation to bloom.
and R&D.
• Implement uniform pricing structure for imported API and
• Encourage rapid entrepreneurship in the cold chain/temperature intermediates.
controlled logistics industry.
Operations
• Implement regulatory skill building as part of the Make in India • Ensure WHO standards are adopted by all manufacturing units
campaign to have CDSCO sign an MoU with the USFDA and by incentivising small-scale industries to become compliant and
Regulation
UK’s MHRA to cross-pollinate best audit practices. by mandating procurements from the National Health Mission
funds to be from GMP/GLP compliant manufacturing units only.
• Provide budgetary support to the SSI to comply with the
capital-intensive requirement of Schedule M.
• Initiate talent development programme for Indian • Link audit rigour with rank on quality index to incentivise
FDA inspectors. companies in improving their quality adherence by reducing
frequency and duration of inspections.
• Develop quality index allotting risk ranks to companies on
audit status. • Make bioavailability and bio-equivalence tests mandatory for all
drug manufacturing permissions.
• Take a product quality-centric approach to inspection with deep
understanding of critical quality metrics. • Institute regular annual audit of labs which will conduct BA/BE
tests and certify the results.
• Reduce inspection rigour for manufacturers who demonstrate
proven adherence to quality metrics in past inspections. • Imbibe a deep understanding of impact of quality on safety and
effectiveness of the product in the inspection SOP.
• Participate in the ongoing regulation harmonisation efforts
(MD-SAP, FDA/MHRA, Q12, PICS). • Actively collaborate with manufacturers to improve access and
Regulation
patient outcomes.
• Build active forums for regulators and the industry to
collaborate on a global basis to advance quality agenda. • Develop capacity to conduct annual inspections by augmenting
inspector count and their skill.
• Implement regulation amendments with the objective
of continuous improvement in the quality of the
manufacturing process.
• Encourage innovation by prescribing in regulatory legislation
what can’t be done rather than what needs to be done to
encourage innovation.
• Keep annual targets to review and prune regulatory statutes
to keep adherence strict but simple for manufacturers to
comply with.
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Academia
Short term Long term
• Institute internship programmes for diploma holders and ITI • Conduct immersive review of current Bachelor of Pharmacy
Infrastructure
graduates to make them job ready by the time of graduation. curriculum and align with industry needs.
• Collaborate with the industry on research.
Industrial bodies
Short term Long term
• Harmonise SOPs across the industry to reduce training time which increases productivity; reduce training cost when
Process and
governance
employees move from one company to another and increase compliance by adopting best practices.
• Institute a Centre of Excellence around Schedule M compliance • Prepare a guidance path for small-scale manufacturers to
Regulation
• Establish a culture of seed and pollinate where senior leaders are rewarded for mentoring and coaching programmes.
• Collaborate with academia on research.
• Optimise processes to cut cost and increase compliance. • Implement real time in-line analytical monitoring.
• Simplify SOPs to make them consistent with operations and • Link all the manufacturing data and provide the ability to
improve the comprehension of followers. provide real-time evidence by correlating batch information with
patient’s medical outcomes.
• Implement OJT for better comprehension.
• Consider having a fully functional cloud with all relevant
• Increase lab optimisation.
development, manufacturing and quality information with the
Operations
• Develop products with an in-depth process and analytical ability to trend and predict failures.
understanding that meet the patient’s and society’s needs while
• Focus on getting new molecules not just for the Western but for
using relevant DfX concepts.
the Indian market too.
• Target Six Sigma process capabilities. Automation and
removing the human factor is critical.
• Implement technology-enabled dashboards to do away with
product testing by identifying failures proactively.
• Quality should be owned by each operation function; make • Make quality a part of the process design flow to ensure better
quality unit horizontal with R&D and manufacturing. process engineering.
• Stress test the process with observations reported in the past • Create career paths that encourage quality personnel to invest
and with peers (national and global). in themselves.
• Submit mock quality internal audit report to the board biennially. • Make quality adherence and improvement a part of the board
Capabilities and culture
audit exercise.
• Engineer quality relay in the process to drive the practice
of achieving the optimal output at each intermediate • Prepare quality dashboards and make them a part of
process stage. management appraisal.
• Include quality in the company’s vision and align it with the • Use a balanced set of operational and quality metrics to set
firm’s strategy. priorities and communicate to the larger organisation to hold
development and operations accountable for quality.
• Encourage employees to express disagreement with evidence.
• Rotate senior management as quality champions driving quality
• Managers should empower reportees to say ‘no’.
adoption from top to down.
• Leaders should walk the floor to talk and understand the pulse
• Promote a culture of all-time readiness with structured
of people touching the product.
continuous improvement programmes.
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Quality systems roadmap 25
Conclusion
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Conclusion
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Notes
The Confederation of Indian Industry (CII) works to create and sustain an environment conducive to the
development of India, partnering industry, Government, and civil society, through advisory and consultative
processes.
CII is a non-government, not-for-profit, industry-led and industry-managed organization, playing a proactive role
in India’s development process. Founded in 1895, India’s premier business association has over 8,500 members,
from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 200,000
enterprises from around 250 national and regional sectoral industry bodies.
CII charts change by working closely with Government on policy issues, interfacing with thought leaders, and
enhancing efficiency, competitiveness and business opportunities for industry through a range of specialized
services and strategic global linkages. It also provides a platform for consensus-building and networking on key
issues.
Extending its agenda beyond business, CII assists industry to identify and execute corporate citizenship
programmes. Partnerships with civil society organizations carry forward corporate initiatives for integrated and
inclusive development across diverse domains including affirmative action, healthcare, education, livelihood,
diversity management, skill development, empowerment of women, and water, to name a few.
As a developmental institution working towards India’s overall growth with a special focus on India@75 in 2022,
the CII theme for 2017-18, India@75: Inclusive. Ahead. Responsible emphasizes Industry’s role in partnering
Government to accelerate India’s growth and development. The focus will be on key enablers such as job creation;
skill development and training; affirmative action; women parity; new models of development; sustainability;
corporate social responsibility, governance and transparency.
With 67 offices, including 9 Centres of Excellence, in India, and 11 overseas offices in Australia, Bahrain, China,
Egypt, France, Germany, Iran, Singapore, South Africa, UK, and USA, as well as institutional partnerships with
344 counterpart organizations in 129 countries, CII serves as a reference point for Indian industry and the
international business community.
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