Attaining and Sustaining Quality - PQRI– Product Life cycle management ... Manufacturing, Testing, Artwork & Origination, Packaging, Warehousing & Distribution, Calibration Products/Service

Quality Affordable Healthcare Products™

Attaining and Sustaining Quality

FDA/PQRI Conference on Evolving Product Quality

September 16, 2014 Louis W. Yu, Ph.D.


Two Biggest Reasons Why I Am

Passionate About Pharmaceutical Quality

2 Quality Affordable Healthcare Products™


Generic & OTC Industry Perspective

on Pharmaceutical Quality

Quality is meeting customer requirements

Consumers want drug products to be: – Effective when used as directed

– Safe when used according to labelled indications

– Available when needed

– Cost effective

These requirements are the same regardless of brand, generic & OTC industry sectors:

– Our industry has achieved a high level of quality as viewed from consumers perspectives (SISPQ)

– Some opportunities for continuous improvement when viewed in the context of procedural compliance

3

Sustaining Quality & Business Success at Perrigo

127-year legacy of focusing on people –

employees, customers, consumers and

neighbors


Perrigo Is a High Volume Pharmacuetical

Manufacturer with a Diverse Product

Offering

Facilities

Total:

EU

Middle/

Far East 4 Plants

3 Plants

14 Plants North

America

Semi-Solids

(Rx, OTC)

800 Million Doses

400 Million Doses

100 Million Doses

1.3 Billion Doses

Solid Dose

(Rx, OTC)

42 Billion Tablets

1 Billion Tablets

47 Billion Tablets

4 Billion Tablets

Liquids

(Rx, OTC)

2.3 Billion Doses

500 Million Doses

2.8 Billion Doses

Infant Formula

36 Million Units

36 Million Units

50 Million Doses

23 Total Sites

12 OUS Sites

Over $3.5 Billion in Sales Over 10,000

employees

Markets over 3,000 products/18,000 SKUs 5 Quality Affordable Healthcare Products™


Perrigo’s Impact on Customers

Globally, Perrigo saves consumers more than $7.5

billion each year

$1 Savings for

every person in

the world !



7

Every second of every day,

somewhere in the world,

nearly 1,600 people will

use a Perrigo product


Core Values & Five Pillars Form the Foundations of Our

Strategy to Attain & Sustain Quality & Business Growth


Quality Affordable Healthcare Products™ Quality Affordable Healthcare Products™

9


Quality Drives Sustained Growth

10

Keep Existing

Customers

Gain New Customers

Sustained Organic & Inorganic Growth

Our Customers:

users of our products, our regulators and our shareholders

Compliance: Total Quality Approach

• Quality is everyone’s responsibility

• Meeting customers requirements means doing things right the first time in everything we do

• When we do things right the first time, quality is free

• If we don’t get right the first time, we must learn and do it right the second time – this means learning to make quality certain.

Effectiveness for the Users of Our Products

Efficiency for the

Shareholders

Compliance for our

Regulators


A Culture of Quality & Continuous Improvement

Everyone in our

organization must focus

on continuous

improvement, to enable

a robust quality culture

We must win the loyalty

of our customers and

reduce the cost of poor

quality and cost of

nonconformance

Management

understanding and

leadership is key to

model behaviors to

align, enable and help

colleagues improve


Strategies to Attain & Sustain Quality

• Quality Risk Management

– Product & customer safety as highest priority

– Manage constantly evolving quality and compliance expectations

• Process Excellence

Meet quality and compliance expectations

Life Cycle Approach to Validation – use statistics to track & trend Ppk during PPQ/CPV stages

A continuous improvement quality culture – RFT focus

• Built in Product Quality

Full product life cycle quality-by-design

Quality into supply chain

• Innovation & Growth

Speed to market, flexibility and agility while maintaining consistent product quality and compliance

Incorporate a global, integrated manufacturing and supply chain to comply with regulatory and

corporate standards

• Human Capital Enhancement

A scalable organizational structure to support product lifecycle and organic/inorganic global growth

Processes and mechanisms to foster a learning organization & quality culture



Quality Capability Building Blocks

To Attain and Sustain Quality

14

Organizational Culture Smart & healthy; Continuous improvement learning organization

Governance

Employee Engagement

& Enablement

Quality Systems

Robustness

Fit For Purpose

(Facility, workforce, product mix, process,

equipment, technology, capacity,

complexity)


Fit For Purpose


Governance

Employee Engagement

& Enablement

Quality Systems

Robustness

Fit For Purpose



complexity)


Fit For Purpose Components

Facility Equipment Technology Capacity Workforce Product Focus

Process Focus


Fit For Purpose

• Facility – HVAC – BMS – Water System

• Equipment – Overall Equipment Effectiveness – SCADA – Automated equipment – Vision systems – Mistake Proofing (Poka-yoke)

• Technology – Information – Production – Enterprise Resource Management

• Capacity – Constraints

• Workforce – Selection

– Development

– Performance Management

– Enablement

– Engagement

• Product Focus – Product selection & product mix

– Complexity

– Product Life cycle management

– PpK and CpK

– Statistical process controls

• Process – Value chain processes

– Supplier chain security and integrity

– Process design & capability

– Process controls

– Process Improvement

17


Fit For Purpose


Governance

Employee Engagement

& Enablement

Quality Systems

Robustness

Fit For Purpose



complexity)


Focus on Quality System

• Quality is defined as conformance to

requirements

• The system for causing quality is

prevention, not appraisal

• The performance standard must be

Zero Defects (meet AQL requirements)

• The measurement of quality is the

Price of Non-conformance, not indices

19


The Headlines – Supply Chain Insecurity

20

Diethylene Glycol (DEG) -Cold

Medicine contamination Over 500 deaths reported in Panama, Bangladesh,

Haiti South Africa, India, Nigeria and Argentina.

Heparin Incident (tainted blood

thinner) The API was contaminated which led to allergic

reactions and deaths in 10 countries, including the

U.S.

Melamine - Milk products & Pet

Food contamination

4 dealths and sickness in more than 54,000

children.

Cargo Theft – Lilly lost $76 mm; JNJ

Pocrit Stolen; Perrigo cargo diverted in

Texas; Teva Copaxone cargo $12 mm


http://images.google.com/imgres?imgurl=http://www.headlinesindia.com/images/1151089341ranbaxy.jpg&imgrefurl=http://www.headlinesindia.com/business-news/pharmaceuticals/ranbaxy-made-30-generic-drugs-blocked-by-us-1661.html&h=228&w=290&sz=20&hl=en&start=9&um=1&usg=__OLRTZjNHYa96cCo0-sZHRbuLWLA=&tbnid=P4HXjaq6w6qAHM:&tbnh=90&tbnw=115&prev=/images?q%3DRanbaxy%2Bwarning%2Bletters%26um%3D1%26hl%3Den%26sa%3DN

End-to-End Supply Chain Operations Quality

S I P O C

Internal Support Services & Quality, EHS, Engineering, IT, Facilities

Supplied

Materials/

Products

Manufacturing

& Testing Packaging Warehouse &

Distribution

End User /

Customer

External Contracted Services

Manufacturing, Testing, Artwork & Origination, Packaging, Warehousing & Distribution, Calibration

Products/Service

Design &

Development


Quality Affordable Healthcare Products™ 22

Supply Chain Security & Integrity

“ Know Unknowns, Unknown Unknowns”

– D. Rumsfeld

“…Complacency breeds failure,

only the paranoid survive” – Andy Grove

We source globally, we must be constantly vigilant

to protect the safety of our customers


http://en.wikipedia.org/wiki/File:Rumsfeld1.jpg

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&docid=_96ZXjuHXY4BiM&tbnid=wvGVco_tdFCtPM:&ved=0CAcQjRw&url=http://favobooks.com/enterpreneurs/51-andrew-grove.html&ei=IPwWVJ_OFIKqyATNtYKIDQ&bvm=bv.75097201,d.aWw&psig=AFQjCNFbW1ve31MsMvUvqIEi-briOy0ozg&ust=1410878830093764

Supply Chain Quality Risk Management

Request detailed information from the supplier Increase audit frequency Active engagement on improvement initiatives Right size sampling and testing programs Business practice review – enterprise wide risk management

Risk Mitigation: Increase Visibility & Transparency

Risk: Opacity of the Supply Chain

Shadow Factories – Unscrupulous suppliers use show-and-shadow factory arrangements Sometimes, the actual manufacturer is only identified when an audit is requested Brokers, re-packagers and distributors involvement in the supply chain Prevention Knowledge

23 23 Quality Affordable Healthcare Products™

• Collaboration with Law Enforcement & Government Agencies

Cross functional Suspected Tampering Action Team

FDA District Offices, OCI to identify tamper suspect

FDA Cincinnati Forensic Chemistry Center (FCC) to collect evidence, FBI to press charges

• Risk Surveillance & Monitoring

Internal company global network & escalation process

Rx-360

PCSC

24

Teaming to Improve Supply Chain

Security & Integrity – we can’t do it alone


OTC Product Quality Focus

Keep the Consumer in Mind

• Smart tablets and containers to augment patient compliance – apply QbD principles to design product based on user demography

• Effective and clear “How Used” label directions to reduce dosing error

• Tamper evident packaging and dosage forms (e.g. banded capsules)

• Child Resistant Closures & Geriatric Easy to Open closure system

• Flow restrictors on Pediatric liquids

• Product tampering – Effective communication with the public

– Collaboration with law enforcement agencies OCI, FBI, local police, FDA District Office

– Track and trend Call Center case logs

25


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Data Integrity – Trust But Verify

• Recent FDA inspections have uncovered data integrity issues in certain areas

• Opportunities for industry to improve

• Extend quality & culture to contract and supply partners

• Honed our skills to conduct forensic audits

• Perrigo is holding hands-on workshops to improve the competency of our global auditors


27

Pharmacovigilance – Global Patient Safety is

Part of the Global Quality Function at Perrigo

• Pharmacovigilance (PhV) - the science and activities relating to the detection, assessment, understanding and prevention of adverse effects or any other drug-related problem

• The aims of PhV are to enhance patient care and patient safety in relation to the use of medicine and to support public health programmes by providing reliable, balanced information for the effective assessment of the risk-benefit profile of medicines

86% of the US Rx are filled by generic drugs – we have the awesome responsibility to apply Good Vigilance Practice



Fit For Purpose


Governance

Employee Engagement

& Enablement

Quality Systems

Robustness

Fit For Purpose



complexity)

Employee Engagement and Enablement

• Quality-driven – Quality at the Source

• Right-First-Time (RFT) Culture

• Learning Organization – If not RFT, then Right-the-Second-Time!

• Innovation through diversity of culture, thought, experience

• Culture of compliance – “we do what’s right”

• Open communications through various channels

• Focus on skills development & operational excellence

• Continuous Improvement – Involve employees at all levels and in all functions

• Recognition Programs

29 29 Quality Affordable Healthcare Products™


Sample Survey of the U.S. Workforce

Stephen Covey, in his book The 8th Habit, surveyed 23,000 employees from a number of companies and industries:

• Only 37 % have a clear understanding of their organization goals

• Only one in five was enthusiastic about their team's and their organization's goals

• Only one in five said they had a clear "line of sight" between their tasks and their team's and organization's goals

• Only 15 percent felt that their organization fully enables them to execute key goals

• Only 20 percent fully trusted the organization they work for

Perrigo’s Survey Results

• Consistently strong engagement levels from survey to survey

– Employees across Perrigo express strong commitment and effort levels, and would gladly recommend the company as a great place to work.

– Retention levels exceed benchmark comparisons, and approach high performing company comparisons.

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Perrigo Global Pharma

I am proud to work

for Perrigo

I would recommend

Perrigo as a great

place to work




Governance

Employee Engagement

& Enablement

Quality Systems

Robustness

Fit For Purpose



complexity)


Governance - A holistic approach

Sites • Audits • Event Escalation Procedure • Floor level Quality Committees • Local Quality Council • Continuous Improvement Roadmap • Site Steering Teams • Quality Metrics • Visual boards

Quality Culture • Quality Incentives & Recognition • Employee Involvement in Continuous

Improvement • Always Quality Program • Communication Systems & Feedback

Loops

Corporate Quality • Corporate Audits • System Assessments • GxP Intel • Trend Reviews • Annual Strategy Update • Global Quality Review Team • Sustainable Quality Compliance

Committee • Executive Steering Team

33


How Do We Know We Are Winning

or Losing?

34

Effectiveness

Customer Service Level

Leading

Human Error Reduction

Leading

Confirmed Customer Complaints/PV Signals

Lagging

Efficiency

Total Cost of Quality

Leading

Right First Time

Leading

Monetary Amount on Quality Hold

Lagging

Compliance

Field Alerts/ Equivalent Regulatory Reporting

Lagging

Regulatory Compliance Status

Lagging

Recalls/Withdrawals

Lagging

Perrigo E2C Metrics

Metrics and Culture

“Not everything that can be counted counts, and,

Not everything that counts can be counted”

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Albert Einstein:

Culture is our collective behavior Observable, but not easy to measure

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&uact=8&ved=0CAQQjRw&url=http://public.ifbyphone.com/general/5-marketing-tips-albert-einstein/&ei=zfkWVN68GpWpyAS5q4DoCw&psig=AFQjCNGUKdBBpwlw7TthAPmXy8voqfW2Kw&ust=1410878285476959

To Attain & Sustain Quality, Focus on

Organization Capability & the One True

Leading Indicator – Culture

• Effectiveness of CAPA

• Right 2nd Time

• Repeat Deviations

Quality Maturity

• Total cost of quality

• Quality Hold

• Right First time

• % Back order

Operational Excellence

• Capital Investment in quality and compliance

• % of time per employee spent on learning

Organizational Readiness


37

Current Thought Leaders on Organization

Culture – P. Lencioni & G. Hamel

• Smart/Value Focus

– Quality

– Growth

– Leadership

– Service

– Strategy

– Technology

– Finance

• Healthy/Joy Focus

– Truth

– Honor

– Beauty

– Love

– Justice

– Minimum Politics

– High Productivity

– Low Turnover


“Culture Trumps Strategy – Healthy Trumps Smart”


• Core Values: Integrity, Respect, Responsibility

• 5 Pillars • E2C Quality • Quality Affordable Health Care • Organizational Health

Health (Key Behavior Focus)

Effectiveness (Key Performance Focus)

ORGANIZATIONAL

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Principles

1) Create Value for the Customer

2) Create Constancy of Purpose

3) Think Systemically

4) Focus on Process

5) Seek Perfection

6) Embrace Scientific Thinking

7) Flow and Pull Value

8) Assure Quality at the Source

9) Lead with Humility

10) Respect Every Individual

Slide courtesy of the Institute for Enterprise Excellence


Culture is beliefs, Values & Behavior


Health (Key Behavior Focus)

ORGANIZATIONAL

Effectiveness (Key Performance Focus)

ORGANIZATIONAL

Results

Behavior

KBI KPI

As a lean organization matures,

the focus will shift

from pure

performance to

behaviors

Leading Indicators

Lagging Indicators

Quality maturity


FDA Evolving Pharmaceutical Quality


FDA Evolving Pharmaceutical

Quality

Formation of the Office of Pharmaceutical Quality

Introducing the Office of Surveillance – Q Metrics

Enabling Alignment of ORA with CDER

Focusing on International Inspection

41

• Excited about FDA shifting focus from procedural compliance quality to customer centric quality

• Impose clinically relevant specifications

• Align ORA & CDER approach to review, approve drugs; conduct risk and quality system based inspections & enforcement

• Regulatory relief to enable industry innovation in manufacturing & quality

• Continue to assure no unintended consequences when implementing global, pan industry Q metrics

• Gradually evolve adoption of Quality metrics & surveillance

FDA Evolving Pharmaceutical Quality



Thank You FDA for Promoting &

Protecting My Family’s Health

36


Thank You

Questions?

37

Documents

Attaining and Sustaining Quality - PQRI– Product Life cycle management ... Manufacturing, Testing, Artwork & Origination, Packaging, Warehousing & Distribution, Calibration Products/Service