By Louis Garguilo, Chief Editor, Outsourced Pharma
A key change in the biopharma industry: “supply chain” has been elevated.
And it should be more visible within all biopharma organizations.
So says Lenwood Grant, who spent 28 years in various supply chain roles while at Bristol Myers Squibb.
Grant left BMS in October of 2018. He’s just returned from a “sabbatical,” newly energized and eager to discuss our industry’s progression.
A large part of that movement has been led by biopharma start-ups and other lean drug developers. Their success is predicated in large measure on outsourcing drug development, and eventually manufacturing.
But what does ‘supply chain’ mean to these emerging biopharma organizations?
There’s certainly a panoply of titles they can reference for suggestions, including variations on Head of External Vendor Management, VP of Strategic Supply Chain, or simply Sourcing/Procurement Manager, or Sourcing Expert.
Grant owned a number of those titles himself. Are they reflective of differeing responsibilities? Or more a matter of organizational fiat?
Despite the varying titles, he says from his home in Syracuse, New York, “The fundamental description I use is this:
“Supply chain ensures an uninterrupted supply of materials, whether as inputs or directed later onto the market. This involves planning, purchasing, receiving and shipping.”
And a lof of working with CDMOs.
“Inputs” are all raw materials, consumables, and such things as testing services, used internally or at your CDMOs. “Market supplies” are your drug substance conversions to drug products, then to final dosages, and again including coordination of all external and internal partners.
“Therefore,” says Grant, “these professionals in any organization are responsible for maintaining supply to meet all material needs and market demand …
“With a cost benefit,” he adds.
“I said cost benefit – I did not add ‘at the lowest prices for materials and services.’ You will not be successful running supply chains with negative numbers, or if quality or reliability suffer.”
The best supply chain pros can guide you in the right direction. And they should do so early in your planning stages.
Research, Set, Go!
Grant is a prodigy of Big Pharma and its recent evolutions. But he also speaks authoritatively to the virtual and mid-sized drug-development organizations populating our industry today.
Nearly all these entities start with a commonality: business/financial and product-development plans based on effective outsourcing.
They should then, also start out with employing a supply-chain professional – and get his or her inputs to the executive level.
Says Grant: “Supply chain needs to get involved early, and be placed up front.”
“Even BMS, when I first started, was often based on the scientist telling you what he wants; you just go out and buy it. But what can happen is those early decisions impact you in later stages, and even into commercial.
“Supply-chain advice needs to be heard at the R&D stage.”
Despite Grant’s earlier proclamation the supply chain has been elevated, he says more can be done.
“The role can become more visible,” he insists. “Today you have all these supply-chain professionals with various backgrounds and experiences. Are they being utilized to the fullest?”
“Full utilization” would include taking advantage of global experience, often necessary at even the smallest biopharma.
“We don’t do as much manufacturing as we once did in this country,” Grant explains. “When I started at Bristol Myers, manufacturing sites in the U.S. numbered in multiple double digits. I can probably count on one hand the number they have now.”
“My point is the manufacturing – including so many CDMOs and suppliers – is overseas. The supply chain expertise you need includes securing those global inputs – raw materials, consumables, your bioprocess products.”
Decisions come on a more global scale for vendor selection and management, and risk and benefit analysis, which are in turn impacted by scientific and platform directions.
It’s unfortunate, says Grant, when still today supply chain only gets involved when there's a problem: “We can't procure the right filters; We can't get cell culture media on time.”
Starkly stated, if your young company is looking at supply chain narrowly, as perhaps “the vehicle for buying things and placing orders,” you may not have an opportunity to grow older.
And a key point regarding endgames:
Even if your strategy is to reach certain milestones to affect a purchase by a pharma suitor, owning a weak, difficult and/or costly supply chain may inhibit you here as well.
Are You Savvy Supply Chain
Your supply chain professional should serve as “the interface between the supplier and primary customers, and your technical functions.”
And thus Grant advises geting supply chain involved early in activities such as developing specifications for supplier and CDMO audits; it’s the function that understands and can communicate individual supplier or industry practices and/or limitations.
“There’s more scrutiny from regulatory agencies today,” Grant says. “Therefore, more due diligence is needed to satisfy them. More documentation and paperwork is required to support audits.”
“Who usually can more readily get this information? I’d say it’s best to have it be your supply chain expert.”
We started our discussion with the raising of visibility of the supply chain function. I ask Grant who until now has commanded the most visibly: Who throws the most weight into early and on-going decisions?
“I think the two strongest groups are quality and development,” he replies. “And of course, R&D at earlier stages.”
“So you may have a situation where R&D, manufacturing sciences – or material sciences, whatever you call it in your organization – and quality are setting the specifications.
“However, those specs can be so tight there's not a supplier who can actually meet them. But they are passed off to supply chain nonetheless!”
To stay away from that and other such scenarios, Grant advises our readers:
- Even an ostensibly “virtual” drug developer should get supply chain expertise within the company as early as possible.
- Give those professionals a seat at the “executive table.” Make them visible and heard when providing input into a wide range of decisions.
- Allow supply chain to challenge specifications and other decisions, and allow them to bring in partners to help you arrive at happy mediums.
- For any company with internal capabilities, recognize there are differences between internal and external processes, such as change control, or perhaps analytical testing.
“Supply chain is in there to kind of mediate, and voice concerns,” Grant finishes up for us. “Fortunately, I was able to work closely with the scientific and technical folks at BMS.”
And that was Big Pharma.
How about you, Small Biopharma? Are you savvy supply chain yet?