Meeting compliance: Challenges for CDMOs before the EU FMD deadline

In this interview, we at EPM magazine speak with Staffan Widengren, director of corporate projects at Recipharm on the difficulties CDMOs are facing leading up to the European Falsified Medicines Directive (EU FMD) deadline in February 2019.

Q. What is Recipharm’s greatest challenge in implementing serialisation?

A.The most difficult part of the serialisation process for Recipharm, and probably the wider CDMO sector, was the securing of adequate financial investment. Such a large-scale change to our operations is an expensive task, costing around €40 million for Recipharm. An investment of this size, while difficult for larger CDMOs, could be unfeasible for smaller businesses. For many, sourcing this sum of money is difficult given that there will be little opportunity for a financial return on investment.

Another challenge Recipharm faced was the coordination between all 15 locations. Trying to work towards a centralised system with integrated business processes and meeting compliance requirements for different markets is a problem unique to multi-site businesses.

Finally, one of Recipharm’s greatest challenges is on-boarding customers, primarily because some will not be using the same network tenant approach as Recipharm in partnership with TraceLink. If this is the case, setting up point-to-point connections for the storing and exchange of serialisation data can take much longer, in some cases up to a year. Recipharm has successfully on-boarded more than 70 customers to date, with around 80 left to go.

Q. What are pharma businesses’ greatest barriers to achieving compliance before the February 2019 deadline?

A.In general, the barriers faced by Recipharm will be the same across the pharma industry, the most difficult of which being financial.

The next largest barrier to full compliance is the lack of knowledge surrounding the topic. Serialisation is a huge task, the scale of which many businesses may not fully understand, leading to them underestimating the amount of time needed to implement it. This knowledge gap can have devastating consequences; plenty of businesses have failed to appreciate the scope of the work and delayed their projects too much as a result.

Q. What sort of timescale should CDMOs be working to?

A.A CDMO should aim to be finished testing and validating its solutions at least three months before the February 2019 deadline, to give it enough time to have product stocked and ready to go in line with customer expectations. Should there be any last-minute changes required, CDMOs will be grateful for this window of time.

Q. What should CDMOs’ main focus be in the coming year?

A.For anyone in the pharma industry the main priority should be compliance, and this is particularly true for late-starting CDMOs. Many businesses are already discussing additional functions of serialisation such as batch-specific recalls, however these are added benefits that should be considered only after regulations have been met. Achieving compliance by the deadline in February 2019 is of the utmost importance and CDMOs would be wise to treat it as such.

For those that have not yet begun preparing for serialisation at all, the looming deadline is going to restrict their choices to standardised equipment and solutions. At this point, customisation will not be possible. CDMOs must also be wary of the onboarding process, as this is rarely straightforward. Each customer will be at a different stage on their path towards serialisation, and businesses must anticipate that negotiations will take time.

Even CDMOs that are reasonably on track towards meeting the EU FMD have important factors to consider, such as the possibility of aggregation becoming a requirement within the next few years. Many in the supply chain are already beginning to ask for it despite it not being part of the FMD, both as a way to future proof their businesses and improve the services they offer.

Q. How can we expect the CDMO landscape to be affected by the FMD?

A. The FMD is likely to push many CDMOs away from packaging altogether, as some don’t have adequate resources to continue this while also delivering serialisation. The outcome of this will likely be CDMOs partnering with CPOs, which should be better prepared for the new regulations. This will allow them to deliver the services that their clients require while meeting FMD compliance.

For CDMOs large enough to operate from multiple sites, centres of excellence for the implementation of serialisation may become necessary.