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May 29, 2013Manufacturing Trouble: Moving From Crisis to Crisis
Every year, FDA issues thousands of letters regarding current good manufacturing practices, or cGMP. Most aren’t a big deal--the bulk are Form 483 observations, which can be as trivial as a frayed conveyor belt or a piece of equipment in the wrong spot. But sometimes they are the beginning of something serious. Then come the warning letters citing serious violations and, if things are not addressed sufficiently, a consent decree that legally mandates changes and limits a company’s ability to operate, overseen by federal courts. At this point, things have gotten very, very expensive and reputations have been seriously tarnished.
None of this is new--there is always some background level of non-compliance, mistakes are made, and companies don’t always address problems when they first appear. And going by the numbers, there isn’t much of a worrying trend. According to data from FDAzilla, Form 483 letters hit an all-time high in 2010 and have been coming back down the last few years. According to The Gold Sheet, there were 53 drug-related cGMP warning letters issued in 2011, which dropped to 40 in 2012. And that reduction in warning letters came despite an increase in inspections. So it sounds like the industry is doing a good job, right?
Well, maybe not so much. Last year might have been an improvement over 2011, but the number of warning letters going out has still more than doubled from the typical level seen most of the last decade. Perhaps more importantly, the nature of those warnings have lately pointed to some pretty high-profile problems. And when the issues involve out-of-date facilities, or a culture of neglect--or both--they can take years to address.
Don’t forget where these problems can go. Genzyme’s 2010 consent decree led to severe shortages of some of its drugs, and contributed to the company ultimately being acquired by Sanofi-Aventis. Johnson & Johnson’s problems with its McNeil Consumer Healthcare unit, which first came to attention in 2009, eventually led to former CEO William Weldon stepping down as well as a lambasting of the company’s reputation that, unfortunately, still isn’t being addressed all that well today.
Those problems continue. Just in the past month, J&J has had serious issues in Brazil, with 3.3 million bottles of Tylenol drops being recalled due to faulty drippers, and especially South Korea, where the Janssen Korea CEO faces criminal charges over the manufacture of Children’s Tylenol, which has already led to the recall of 1.7 million bottles. This is going on even as the company continues to remediate its Fort Washington-Pennsylvania facility, home of McNeil Consumer Healthcare, under an existing consent decree.
Meanwhile, Hospira could be heading the way of Genzyme (in terms of a consent decree or even a takeover) as problems that first surfaced in 2009 increasingly appear to be part of a global pattern that the company is having a hard time getting a handle on--despite a $300 million remediation effort. The company’s most recent woes include gray-brown particles found in sodium injectables, but these are just the latest in a long string of warning letters.
And Ranbaxy’s uneasy marriage to Daiichi Sankyo continues to cause trouble. This month, Ranbaxy agreed to a $500 million settlement of civil and criminal charges relating to egregious and extensive manufacturing problems that date back many years. Ranbaxy is still operating under an FDA consent decree that forbids it to import products from certain facilities, and Daiichi is less than happy about the whole thing. (They bought the company while the story was still unraveling, although Ranbaxy’s founders think they should have figured out which way the wind was blowing.) And Ranbaxy’s problems still aren’t over, with Indian authorities contemplating taking action against the company.
The fact that these issues can spin out for years and unmake companies is reason to take every warning letter seriously. News in the past few days that Boehringer Ingelheim has gotten a warning letter over the detection of foreign particles in some active ingredients has raised some eyebrows (although the privately held company generally has a pretty clean track record).
Likewise, Alexion was recently warned over the presence of organisms in batches of Soliris. Earlier this month, FDA took the somewhat unusual step of publicly releasing Alexion’s response to the Form 483, which notes that the isolates in question aren’t “considered common human pathogens.” That’s true--one of them was Bacillus thuringiensis, the critter dusted on crops by organic farmers to combat certain pests. But still, it doesn’t seem unfair to expect some pretty stringent purity on a drug that costs $440,000 a year!
FDA Commissioner Margaret Hamburg has made it abundantly clear that drug quality is one of the agency’s highest priorities in 2013. She’s particularly concerned with the rising number of products being made by multiple generic manufacturers, which has sometimes been a source of trouble in the past. So don’t expect the number of warning letters to drop. Investors should be wary when they see them, companies should be proactive in avoiding them, and executives should remember that it’s a lot easier to maintain your reputation than it is to rebuild it.
-Karl Thiel
Read the BioPharm Executive online newsletter May 29, 2013.
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