Outsourcing Activities
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1 Outsourcing Activities Responsibility & Control Chris Cullen/Victor Garvin GMP Conference 12 th November 2014
2 Agenda Examples of Outsourced Activities Advantages & Disadvantages Risk & Responsibility (R&R) Changes to Chapter 7 Important Considerations Conclusions 2
3 Examples of Outsourced Activities Obtain goods or a service by contract from an outside supplier To arrange for somebody outside a company to do work or provide goods for that company To subcontract work to another company To buy in components for a product rather than manufacture them 3
4 Perceived Advantages Reduced costs Achieve greater flexibility Buy in specialised knowledge & skills (problems with evaluation?) 4
5 Perceived Advantages Facilitate a rapid exploitation of new technology (risk assessment) Gain experience of new technologies Freedom to concentrate on core functions Spread risks (increased GMP risk?) 5
6 Perceived Disadvantages Increased dependence on suppliers Lack of shared vision & objectives cultural & language differences Loss of control over suppliers (can be mitigated by proper proactive risk assessment and a responsibility focused oversight of outsourced activities by the contract giver) 6
7 Perceived Disadvantages Loss of critical skills (loss of expertise to assess service providers) Problems evaluating supplier performance (qualification) Problems monitoring supplier performance (site audits by contract giver, negative regulatory audit findings) 7
8 Changes to Chapter 7 Revised to provide guidance on outsourced GMP regulated activities beyond the scope of contact manufacture & QC testing activities Now includes all outsourced activities impacting GMP Came into force 31 st January
9 Risk & Responsibility (R&R) The responsibility for assessment and GMP compliance cannot be abdicated the contract giver is always ultimately responsible Outsourcing activities involves a significant degree of risk which must be assessed and mitigated by the contract giver Particular situations can be complicated if falsification or serious non compliances found during regulatory audits of contract facilities 9
10 Important Considerations (Contract Giver) Adequate documented procedures in place for assessment and control of outsourced activities (e.g. including contract service providers working on site) All service providers now included in the scope of outsourced activities Risk management principles should be applied to the selection and ongoing assessment of outsourced activity providers 10
11 Important Considerations (Contract Giver) Responsible for ensuring that the performance of service providers monitored and reviewed on a routine basis to identify and ensure implementation of improvements Responsible for auditing of (internal) service providers, verification of calibration data, e.g. DCS system data review Responsible for ensuring technical agreements in place with service providers are updated to reflect requirements of Chapter 7 11
12 Important Considerations (Contract Giver) Importance of control and retention of primary records of outsourced activities, e.g. PM schedule, notebooks, paper forms Primary records stored electronically, i.e. Tough books used to record GMP activities software validated with GMP audit trail activated 12
13 Conclusions (of Presentation) Outsourcing activities are continuing to grow and expand in the Pharmaceutical Industry Complexity of outsourcing arrangements and number of parties involved in outsourcing activities continues to increase Level of GMP oversight and governance necessary for outsourced activities can often be underestimated or not appreciated 13
14 Conclusions (Negatives and Positives) Some Public Quotes: Governance is a top concern of outsourcing professionals today. The lack of good governance is being recognized as the root cause that outsourcing outcomes fail to meet business expectations for buyers and providers of these services Jag Dalal Jag Dalal is chief advisor to the International Association of Outsourcing Professionals (IAOP) The more responsibility you take, the more in control you are Brian Tracy Brian Tracy specialises in the training and development of individuals and organizations 14
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