In simple words, lean strives to reduce the waste from any process or function that does not create value but uses resources.

The lean experience within pharmaceuticals has not been a clean one.  Compliance problems, globalization, as well as production and pricing demands, have been a huge impediment over the profitability and competitiveness of pharmaceutical companies in general.

The amount of waste created by this industry amounts to billions of dollars per year, and pharmaceutical companies are opening their eyes to the value of finding more efficient ways to operate, making lean manufacturing the preferred method for many.

The success of these practices, however, has been scarce, since traditional lean manufacturing practices do not fit the very dynamic and difficult pharmaceutical production demands.  If an ingredient is not available, for example, even in the event of a crisis, lean manufacturing will not be able to work.

In view of this, some companies have tried technology to achieve leaner production based on demand, but even so, they are still looking for ways to improve manufacturing.

To be able to benefit from lean, pharmaceutical companies, must have global vision of production performance, optimization, and simulation capabilities which enable them to create scenarios of better performance, even under the variability equation.  This equation is nowhere as strong as it is in pharmaceuticals, where the need for different strength, packaging, and presentation styles is enormous.  Stocks can easily expire because of new products that can make the past ones obsolete.

The reality is that lean is effective in meeting predictable demand at the lowest cost possible.  In an industry where you can always count on change, it is easy to see how traditional lean is struggling to fit in.

But there is hope.  Next generation software and methodologies have proven capable of adapting to the traditional lean manufacturing ways.  This software considers variability and works to minimize its impact by adjusting traditional performance metrics, using flow path management to create more flexible ways to define value streams and organizational structures.

To start reducing the amount of waste, companies must combine lean and flow-based manufacturing methodologies, simulation and analysis software.  In the future, pharma will be able to break down organizational structures and integrate manufacturing processes.  Decisions will be made according to flow through the factory, improving the control over the main performance indicators.  Decision making impacting the plant floor will improve because of real time data availability, reducing inventory and cycle times drastically.  Companies will be able to define best practices and prioritize metrics based on business goals and challenges.

So, even if lean works best where stability and predictability are the norm, new ERP tools may help to successfully apply lean to pharmaceuticals.  Expert pharmaceutical consulting firms possess all the expertise to guide companies through the lean process, pinpointing its strengths and weaknesses clearly for every specific case.

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Important data suggests that drug development is becoming more expensive each day, reaching astronomical sums estimated at billions of dollars per product.  This, together with the fact that the FDA is approving fewer license applications per year, increases awareness that, either your business makes the right choices, or it is out.

More than ever, now is the time to find strategic relationships and meet the right people; but it is hard to identify real value event opportunities that really justify your time out of the office.

You have to identify ways to be the first to knock on every opportunity’s door, be it formal or informal networking, industry strategy schemes, competitive insight from leaders, the best pharmaceutical consulting, or a combination of these.

While networking at a conference, you want to make sure you get everything possible out of each high level presenter or person there, so plan for opportunities to create valuable relationships during coffee breaks, drinks receptions, round tables, and dinner parties.  The goal of any conference is to meet potential partners, enhance existing relationships, and go home with numerous opportunities to consider later.

Days before you attend the conference, check out the guests and plan your schedule so that you can have several formal meetings during the day.  Breaks and lunches are perfect occasions for informal gatherings.  During dinners, you can network with high profile guests and colleagues.  A chat while sharing some drinks is the best way to finish a long successful day and make friends.  Round tables offer you the opportunity to hear expert opinions, interesting discussions, and even join in with your own questions or suggestions.

Look for networking opportunities offering you solid information on potential partners and competitors.  Look for insights from biotechs and pharma, overviews from regulatory bodies, coaching from independent professionals and worldwide innovations.

Be prepared to partner professionally.  Train yourself to acquire partnering skills; research the internal processes of big companies and learn from expert lawyers, marketers and managers.

Pay close attention to emerging markets, which are becoming fundamental for reaching innovation and powerful cooperations.  India, China, and Latin America, among others, are vital new markets around the world.  Find ways to reach them, meet them, and get in business with them.

Selling the business it took you so long to create is not easy in any way, practically and emotionally.  It is difficult to be objective when talking or deciding about something so close to your heart. You will have only one opportunity to position and price it to maximize the profit you will get for years of hard work.

To make it through triumphantly, you need a plan.  You must follow several steps to get you fit for the sale and have control over the whole process.  It is vital that you define very clearly why it was that you started the business and under what conditions you are prepared to sell it.

If you are considering the option of selling your business, please follow these steps to guide you painlessly through the process:

1. There must be an advisory team, composed by your lawyer, accountant, and a specialist in mergers or acquisitions, like for example, a pharmaceutical consultant, for this specific field.  These three people will cover every important area of the process and will get you what you desire.
2. Put the right price on your business.  Experience and knowledge are necessary to avoid overpricing, which will scare buyers, and underpricing, which will cause suspicion.  Your team must be able to price your company according to the market.  The mergers and acquisitions’ specialist can set a fair market price and can also identify elements in your business that, if corrected or changed, may increase its value.
3. Study tax consequences of the sale, because taxes can consume your profits. Get a tax expert’s help.  Taxes will be based on two things: how the business is legally set up and whether you are selling assets or stock.  The merger’s specialist can help you find ways to reduce tax impact.
4. Prepare due diligence materials with your mergers’ specialist.  This person is in charge of qualifying buyers confidentially, and once these start asking for your business’s information, these materials have to be gathered carefully to avoid surprises later.
5. You must promote your business for it to be noticed among others.  The specialist is an experienced marketer, thus, he or she is the person to turn to for advice.  Let them do their job in completely justifying your price.
6. Ask for expert help in talking about the sell to your employees, suppliers, and customers.  The specialist knows how to maintain things confidential until every buyer has been interviewed and checked for financial references.
7. Negotiate for a win/win situation.  The specialist will be there to assist you and help you avoid disputes.  His or her objective view will help you sort the toughest issues.
8. The specialist may also help your potential buyer find financing opportunities. Many owners finance part of the price to their buyers.
9. Define terms and conditions early on.  Clarify if the buyer will limit your future participation in the field, if you will work for them in any way, or if you are keeping some assets.
10. Have everything ready for the closing meeting, as you shouldn’t deal with last minute issues then.  The mergers’ specialist will help you gather everything to present to the buyer.

Of course, each of these steps demands a complicated process that must be understood clearly before selling, and through it all, you should have the mergers and acquisitions’ specialist right by your side.

It had to. Six Sigma strives to reduce variation in products and processes, while Lean manufacturing goes for ending manufacturing waste.  It is clear that there are several areas within the pharmaceutical industry where these two could be implemented, and are strongly advised by expert pharmaceutical consultants:

-Research and Development (R&D).  This is the principal process where the business starts for all pharmaceutical companies, and it is also the most expensive one.  Lean manufacturing comes into the picture to understand and define the critical procedures for developing new drugs, as well as to analyze and guide the current ones.  In this way, pharmaceutical companies are trying to reduce drug failures, learn to utilize resources to the maximum, increase productivity, and apply effective criteria to use personnel and other resources efficiently.

-Cycle times.  Cycle times for pharmaceutical procedures are extensive, and these are affecting on-time manufacture, supply, and launch of new products.  Timing is critical for the success of a new drug, thus, companies must reduce production timings to take full advantage of the market.  Lean manufacturing and Six Sigma offer value stream mapping and process modeling concepts capable of reducing these cycles and costs, making the processes and staff, more efficient.

-Defects.  These are a huge risk for pharmaceutical companies.  No one wants to risk making people ill or to cause a death.  Lean’s DFSS uses scientific and statistical tools which reduce the cost of human mistakes and inefficiencies.

Six Sigma creates many opportunities for pharmaceutical companies using it. While Lean happens at the operations and management levels, applies to the behaviors towards customer focus and coherent mission statements and values, Six Sigma’s goal is to change the organization’s momentum.

A broad strategy towards Six Sigma training is required during several stages of the change to Lean manufacturing, in order to gain stronger organizational skills at the management and general staff levels.

IT is vital in the transitioning process to ensure constant improvement.  The complexity of the manufacturing processes makes it necessary to acquire flexible and practical IT systems.  Data gathering and analysis must occur fast, effectively, and accurately; improving reliability.

The reliability aspect makes this information the basis for guiding, decision-making, and cost lowering.  Over time, an automatic system will make quality results possible, speeding analysis and design changes to improve the operation’s efficiency and compliance.

By being able to meet the demands in real time, inventories and costs are reduced efficiently before the drugs’ expiration dates.

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For some people in the pharmaceutical business, the concept of a Lean Laboratory is only a trend that will soon pass. However, far from being just a momentary trend, it made the whole industry conscious of how much time and resources were wasted because of poor organization and analysis. Nowadays, the differences between lean laboratories and conventional ones have become enormous, especially in terms of productivity and efficiency. Results corroborate that conventional laboratories have at present only two choices left: embracing change or disappearing.

But, what are the issues forcing conventional labs to fall behind? Here is a list of the main negative points, as identified by life sciences consulting firms.

LACK OF FOCUS: Test routing can be variable and depend on product type and/or intended market. There is no control of the progress of individual samples as the focus is in test accuracy or individual test run efficiency.

LONG AND VARIABLE LEAD TIMES: “Efficient test runs” cause the delay of sample testing results. Before the tests are performed, an important amount of samples have to queue for a long time until the right amount of similar samples arrive.

INEFFECTIVE “FAST TRACK” SYSTEMS: There is clearly a problem in prioritization of samples. Fast track systems were originally designed for urgent results, but as the amount of prioritized samples is excessive, the system becomes clearly ineffective.

HIGH LEVELS OF WORK IN PROGRESS (WIP): Too much time spent in controlling, tracking, and prioritizing samples and/or designing analyst work. You can try to optimize time by investing in IT tools, but that doesn’t solve the problem. The solution? Re-engineering the whole process.

VOLATILE INCOMING WORKLOAD: It’s difficult to understand the capacity of a laboratory, as the workload is generally unpredictable. Peak moments with high productivity but poor lead performance are followed by dramatic dips with very low productivity. Stabilizing the incoming workload is a key issue here.

Lean laboratories win the first battle by defining clearly what the value add and non value add activities are, as well as providing clear maps of the overall process, so there is logic in whatever part of the lab process people are participating. By leveling the workload and the mix of samples as well as  eliminating non value add or incidental tasks, they improve efficiency. By managing performance  in every part of the process (using KPI’s), they keep control over all lab operations, all the time.

How can conventional laboratories fight that? Apparently, to stay in the market they have only one solution: change. But no generic approach will provide good results, unless they perform careful analysis of all lab activities and they undergo a complete re-engineering process with the help of a pharmaceutical consulting firm. The process will involve changing the minds of those involved, too. Only lean analysis specialists will be able to identify clearly the key issues in all areas, and provide the most adequate solution. Conventional laboratories  must then lay back and stick to the old saying: “if you can’t beat them, just join them”

Though the concept of “lean” originated in the car industry, most manufacturing businesses have adopted its principles as the best way of improving efficiency and reducing costs. Analytical and microbiological laboratories are embracing this trend too, though the volume of samples is definitely lower, and with a high degree of variability and complexity. For this reason, the application of this management model requires some changes and adjustments to the generic approach, though the leading principles stay the same.

How can you implement a lean laboratory? In general terms, by simply applying a set of principles, which focus basically on improving measurable performance and reducing costs. This is a list of the key principles, applicable in all cases. Pharmaceutical consultants can provide you with more complete information and guide you through the complete process.

1.    SPECIFY VALUE: To have a lean laboratory you need to classify every activity as “value add”, “non value add” (always from the customer’s point of view) or “incidental”. Then, the idea is to reduce or eliminate the non value add activities.

2.    IDENTIFY VALUE STREAM: Create maps of the overall release process, so people have a clear idea of what they are doing. This allows any intended improvement to benefit the process as a whole and not become just a point solution.

3.    MAKE VALUE FLOW AND CREATE “PULL”: Have a defined sequence of tests and associated analyst roles. That way you make good use of the team and equipment. The idea is that once testing is started on a sample, the process continues until it ends. Lead-time reduction and efficiency are facilitated as a result of this. “Pull” on the other hand, refers to testing according to customer priority or demand.

4.    LEVEL THE LOAD AND THE MIX: Put the same amount of work into the lab on a daily basis. This will help to level the workload and significantly improve productivity, which will also lead to cost reduction or provide additional capacity.

5.    ELIMINATE WASTE: Focus on developing solutions and re-engineer processes to eliminate non value add or incidental activities. Keeping only the essential is the key.

6.    MANAGE PERFORMANCE: Reviewing performance on a daily basis is essential. Good Key Performance Indicators (KPI’s) will mean that your work is efficient, cost-effective and at the highest quality standards.

Implementing lean in the laboratory is not an easy task. It requires a lot of hard work, firm principles, and clear guidelines. Still, changing the minds of the people involved may be the hardest task, as they may be very reluctant to change. They will soon adapt, however, as their workload will be optimized, and they will notice that their work is less strenuous and more productive. You may also consider the construction of new facilities, to optimize the use of space and facilitate team work.

Hard as the task sounds, the benefits are many. You will improve efficiency, reduce costs, and improve your lab’s overall performance and quality. Implementing a lean laboratory will soon lead to resource optimization, improving your competitiveness and not only ensuring your presence in the market (as conventional labs will soon be obsolete), but making your lab a market leader. Bring with lean the key to your future, and let the future stay in your lab.

Lean must be seen as a journey, not a destination. It requires a continuous effort; moving through errors and reversals to achieve top efficiency. Maybe the major slow downs have resulted from convincing management about lean’s long-term value, enforcing eye-opening and hard reviews of inefficient processes and directing unwilling personnel to assume new ideas and actions.

But even worse, those errors and reversals are not controllable by manufacturers anymore. Huge raw materials and services costs, and low cost labor locations are two important examples.

It is now that manufacturers are discovering that lean alone is not enough. It is not just about improving the process, it is about a culture change, too, and also about a much needed direct cutting of costs that lean is not able to provide all the time in order to excel over cheaper labor options, for example.

Lean has proven to be counterproductive in some sense. Some manufacturers have had to reverse their lean gains because of the amount of materials coming from overseas, some of them of lesser quality than the domestic ones. Still, others have had to increase materials inventories because of unreliable delivery services.

Due to this situation, manufacturers are implementing ideas that are compatible with the lean thinking, like trade payables, allowing them to order extra materials while keeping low inventories. However, it seems these ideas are not being implemented fast enough; they are, in reality, being forced upon them once the situation proves unsolvable through “conventional” means.

Of course, manufacturers should not forget about lean, and this is a que for the help and advice of pharmaceutical consultants and their companies, that can leverage their skill sets to the advantage of the client. It is the time to be extremely creative, due to the wild competitive situation out there. Maybe it is time to demand the same level of lean performance from healthcare suppliers and providers as the one demanded from raw materials suppliers, or perhaps it’s time to check the cost-of-consumer or develop a less cyclic mix.

The new road to take will vary between manufacturers and industries, but one thing is certain, lean is not all there is or is needed anymore. Besides process improvements, the market is asking for thorough reviews of the whole company and industry. This is the signal to think out of the box.

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With the drug industry facing a drought of new drugs in the pipeline, lower revenues, lower margins and increased oversight, the times when the opposite situation made manufacturing efficiency and competitiveness uninteresting are over.

Although research and development (R&D) is usually thought of as being the highest associated cost for pharmaceutical and biopharmaceutical companies, by industry estimates it is manufacturing that takes the cake with 36% of the cost, which is about twice that of R&D. The potential savings in manufacturing have been very large in absolute terms for many years. But high margins and revenues, along with the regulators’ old end process testing route for checking processes for compliance made companies reticent about change. Once a process was verified as compliant, any proposed change posed a possible stop in production and lost revenues that could not be sufficiently justified even with the manufacturing efficiencies gained. The move of regulatory agencies toward favoring compliance through built-in quality rather than end process testing has changed that. The rougher industry realities have also pushed companies toward going after the savings, wherever they may be.

One favored way to find such savings has been lean analysis. The lean analysis techniques and methodologies focus on the elimination of waste in every resource and making every process a value-adding one. This is precisely what a pharmaceutical consultant can do.

First, processes need to be defined as value-adding or non value-adding. Investigation is then conducted to find out why it does not add value and whether it can be modified or substituted to add value. In this way, process by process, a streamlining of the manufacturing flow takes place, and control systems to ensure efficiency are installed.

Typical benefits of lean analysis are:

• Manufacturing cycle time reduction
• Lead time reduction
• Floor space requirement reduction
• Work-in-process reduction
• First-pass yields increase
• Throughput increase
• Productivity increase

In the pharmaceutical and biopharmaceutical environment, where the risk of contamination or product recall must be eliminated or face extremely high costs and liabilities, an added benefit of lean analysis is the elimination of information waste. Information systems are of great importance in building quality systems and ensuring compliance.

The pharmaceutical industry in the US consumes around one billion dollars in energy in one year. Energy consumption represents a large portion of the manufacturing plants’ budget, which in times of economic crisis is utterly relevant. To improve energy efficiency there is a wide variety of opportunities at each individual manufacturing plant’s disposal. Pharmaceutical consulting firms can provide an array of solutions to reduce energy consumption and increase efficiency, as well as keep the plant environmentally clean.

Several studies based on real world applications from pharmaceutical manufacturing companies have shown that savings in energy and energy-related costs can be achieved by different measures, in all cases guided by professional pharmaceutical consulting firms. Energy consumption reduction is crucial for companies to maintain overall efficiency and the quality of the products at the same time as costs are reduced.

The costs of the pharmaceutical industry’s energy have continuously grown since 1987, and this has directly influenced the industry’s prices. The type of product has also had a direct relation on the total consumption of energy. Heating, ventilation, and air conditioning (HVAC) uses up much of the energy in plants, so the focus must be put on applications with motors such as pumps and fans in order to reduce energy costs.

Key factors that affect a particular plant in terms of energy consumption include the type of facility (such as research and development or bulk production), the products that are manufactured in the plant, its location, and the efficiency of its systems.

If we analyze a breakdown of energy use in pharmaceutical plants, the most energy is used by bulk manufacturing, representing about 35 % of the total. Research and development takes up 30 % of energy, while formulation, packaging and filling, 15 %. The offices and warehouses take up no more than 25 % altogether.

Improving energy management can be tackled from different angles. An integral, corporate program is fundamental: it should include facility, health, safety, and management of employees. The use of efficient, working motors is essential, as well as the optimization of the different compressed air systems. These provide opportunities for energy cutbacks and savings. Also, keeping low laboratories ventilation can reduce energy use significantly. The whole production system can be fine tuned to reduce the amount of energy consumption and, in the end, save money.

This, however, does not happen on its own, nor is it accomplished overnight. A clear and decisive management program needs to be put into action, and employees and managers must be educated in order to apply the measures indicated by professionals. It should be an ongoing process and one in which all stages of production work together, in order for it to work and for the company to achieve the best results.

Until recently the  Life Sciences sector has been somewhat reluctant to change. Part of that can be traced to the fact that during the last two decades,the industry  has been enjoying  enviable margins, and has had a philosophy of non-change. But economic crisis can change it all. Now,the pharmaceutical industry is currently being challenged by hard times, and change is required.

Even if this is generally recognized by the managers and workers in the sector, there has not been much action taken towards the need for change and overcoming the obstacles. Lean principles, which have been proven to work, and which can adapt to the requirements of the industry, can be very successful. Lean options are even being applied by regulators, so the time has come to apply the principles to the pharmaceutical industry.

In general, pharmaceutical industries have been slow adopters of lean technology. It is well behind many other sectors that have used its principles to improve performance. This stems from the fact that manufacturing was generally perceived as a cost and not as a way of generating competitive advantage. Focus was on research and development and sales and marketing .. As a result,the  manufacturing stage was often overlooked.

But manufacturing processes have become more complex and important. A global and integrated view has to be applied. So an integral and overall strategy needs to be put into action, preferably by business life sciences consulting firms.

However, interim strategies do not always apply. It is not recommended, for instance, in the following circumstances:

• When resources, leadership, and experts are available within the company,
• When the company is not open to changes due to cultural or style reasons,
• When there is not a visible cost/benefit advantage,
• When there are interests that collide, or it is not possible to be objective,
• When the company is not comfortable sharing information with external advisors.

So when pharmaceutical companies do not meet the requirements to bring external consultants, it is probably better off analyzing the processes itself. If, on the other hand, the requirements are met, these are the key elements that should be sought after when hiring an external group:

• The type of service it provides: whether it’s specific or general.
• Whether the group has extensive knowledge and a solid background throughout the stages of the product’s life cycle.
• The services the group does not provide.
• The knowledge and experience of the group.
• Whether they are capable of planning projects and take them to action as well.
• Whether the consultants can meet timelines and deadlines.
• Whether the group delivers customized solutions based on each company’s problems or just canned responses.

Life Sciences consulting is essential to maintain the competitive edge of pharmaceutical producers in the marketplace.

In a changing world, being able to adapt and reformulate is necessary for survival..