Congratulations - your emerging biotechnology company is within sight of its first Biological License Application (BLA). This is the culmination of years of research and clinical development.
Congratulations - your emerging biotechnology company is within sight of its first Biological License Application (BLA). This is the culmination of years of research and clinical development. Have a party but quickly go back to work because there is a next step in marketing a new therapy. Successful clinical results are only part of a marketing application.
Biotechnology companies must also prove to the regulatory agencies, to their business partners, and to their investors that they can produce and support their products consistently and safely once they receive marketing approval. The most productive route is to implement a project that sets up structured processes long before BLA submission. Benchmarking shows that structured processes can improve product development productivity by up to 30%, leading to a more gradual resource ramp-up and faster time-to-market (1).
Table 1. Performance metrics used to measure operational readiness.
Achieving commercial readiness is a challenge. This article describes a program that enables a company to build incrementally its commercial readiness capabilities. Careful prioritization, organization, and management of a commercial an operational readiness program are essential to leverage limited resources for maximum effect while minimizing disruptions in the accompanying drug development program.
With this program, senior management now has a forum and a process for making better business decisions at the time when these decisions have maximum impact. Its purpose is to leverage the experience and talent of senior management and support decision making at its most appropriate level by empowering project teams. Specifically, it can control scope, direction, timing, and resources allocated to operational readiness projects. In addition, it is now possible to leverage the best practices of project management and communicate clearly within and across projects and functional disciplines.
The method is a five-step program designed for biotech companies. The steps are
Make commercial readiness a corporate objective, whether your company is close to submitting its BLA, or is still in phase 1 clinical trials. This objective signals to employees, business partners, and investors that you are positioning your company for success. Practically speaking, commercial readiness capabilities are embedded in a company's core business processes and systems (Figure 1).
Figure 1. Core business processes and systems for drug development and commercialization.
Commercial readiness is sometimes assumed to be the natural outcome of the drug development process. As a company proceeds through development, the structure of the firm gets more complex with business processes, practices, and systems evolving almost automatically. Typically, staff members transplant these processes, practices, and systems from their former employers, modestly tailoring them to the current culture and environment. On the road to commercial readiness, management will adopt a short-term goal to get basic business processes in place that need to comply with CGMP. These items become standard operating procedures (SOPs) that guide the employees.
If any given process or system can be capable of supporting commercial operations, it must be effective, efficient, scalable, and CGXP-compliant. Base your corporate objectives on achieving a state of "operational readiness" for each of the company's core business processes and systems.
Metrics (Table 1) enable senior management to measure the company's progress toward achieving operational readiness for any given process or system. Progress will stall if the objectives are not backed up with the resources needed to develop robust business processes.
Building operational readiness must be an everyday activity for any given cross-functional team asked to design, develop, pilot, and implement business processes. As a rule of thumb, allow individual members to invest 20% to 30% of their time in these activities. Keep them together for the project's duration to ensure operational excellence. Skimping on this commitment will cause operational-readiness objectives to get crowded out by product-development objectives.
Once your company is committed to achieving commercial readiness, the next step is to map out a structured and logical approach for building operationally ready business processes (Figure 2). Start by assessing the readiness of current processes and systems (Figure 1). You want to prioritize and sequence improvement initiatives based on the expected time to get marketing approval, process dependencies, compliance gaps, and existing process improvement plans. There are four steps for assessing operational readiness: define the assessment scope, charter the assessment team, define all the current processes, and identify operational readiness gaps.
Figure 2. A structured approach to operational readiness.
Define the assessment scope. The extent of the scope will depend on the resources that can be committed to the process assessment. Earlier in development, focus the assessment mainly on the management processes and infrastructure needed to support the drug development process, namely: quality systems, information technology (IT), partner management, and project and resource management. Once these building-block processes are in place, circle back to developing or improving the operational processes (for example, process development, commercial supply-chain operations, and medical affairs operations). When preparing for preapproval inspection (PAI) or prelicensing inspection (PLI), the scope is typically broad and covers most, if not all, processes identified in Figure 1.
Charter the assessment team. Senior management should charter a team to conduct the process assessment. Pick members from one of three groups: a cross-functional team of managers, an objective third party, or representatives of existing core business teams. The charter must have a narrow scope and a fixed timeframe, clear deliverables and milestones, and a clear definition of roles and responsibilities among the team, its leader, and the senior managers who will review the team's findings and recommendations. Most importantly, senior managers must free up team members' time to ensure they can conduct a thorough assessment.
Define the current processes. The assessment team will use standard management tools and techniques to define the current state of the company's business processes. Good techniques include: interviewing key individuals to document problems and issues; reviewing SOPs; documenting process inputs and outputs; reviewing process metrics; and identifying the roles and responsibilities of people and systems. Compile the information in a process map to get a detailed understanding of current processes. These are possible components for a map
Identify operational readiness gaps. Process mapping usually reveals a host of process gaps. A thorough map will highlight resource bottlenecks, process redundancies, unnecessary process steps, processes that can be automated, unclear or overlapping roles and responsibilities, inconsistent deliverables, and non-compliant areas. The assessment team can conduct a semiquantitative ranking or scoring of each process's operational readiness based on predefined criteria and metrics (Table 1 and the process map). Add in specific process findings and recommendations within each category. Assessment teams must consider how effectively the company's processes are supporting the company's business, regulatory, development, clinical, and supply-chain strategies.
Before chartering actual projects, prioritize the operational-readiness gaps and recommend improvements. The prioritized list provides a project roadmap that the company can use as an investment guide, and to schedule the flow of projects into the business-process development pipeline.
A good technique for prioritizing is to first group the recommendations into a series of discrete projects. Those with linked processes, or related tasks, then can be organized into portfolios - such as, quality systems or IT projects - for cross-project planning and resource allocation. Carefully assess the scope, magnitude, and business risk of the process gaps as well as the scheduled date for marketing approval, available resources, and corporate objectives. Now prioritize the operational-readiness projects.
Each biotech company may have a different priority list, but - generally speaking - each should improve the following four management processes first since they serve as a foundation for many operational processes.
Quality Systems. Quality system processes build upon each other; therefore, building a quality system should begin early in drug development. Developing effective quality systems requires an incremental approach, often sequenced over two to three years.
Begin by developing a corporate quality manual. A quality manual not only defines the architecture of the quality system (including the document hierarchy), but also establishes policies that serve as guidelines or boundaries for each of the processes that constitute the quality system.
Next, focus process improvement initiatives on the foundation elements of effective quality systems: document control, design control (for drug delivery devices), change control, and training. Improving materials control processes should be high on management's priority list because of its importance throughout drug discovery and development.
Information Technology. Excel spreadsheets and Access databases are usually inadequate to support the validation requirements and transaction volumes expected for commercial operations. It is essential to have a robust IT systems plan and process because implementing validated systems can take many months, and require significant investment dollars. The plan, or IT roadmap, is a sequenced list of IT projects that will carry the company through commercialization.
Set IT priorities after assessing existing systems for efficiency, scalability (capacity), 21 CFR Part 11 compliance, and resources (2). To facilitate implementation, establish a corporate process for selecting, implementing, and validating an IT system. Put the IT roadmap and systems implementation process in place before you begin making any significant additional investment in the IT systems.
Partner Management. It's no secret that many biotechnology companies have dysfunctional relationships with their business and outsourcing partners. It is rare for the contracts to capture all the assumptions and expectations each party brings to the table. Moreover, the contracts may provide only bare-bones details about how both parties will interact, resolve disagreements, and monitor the relationship's ongoing health and performance.
Here's a fix: Start by establishing a robust process for identifying, selecting, and managing partners. The process defines clear roles and responsibilities, decision-making bodies and procedures, systems and tools to facilitate communication, and performance metrics for continuous improvement. Document the process in a Joint Service Agreement (JSA). JSAs are not legal documents. Insteady, they supplement development, commercial-supply, and quality agreements by helping guide the day-to-day interactions between the partners. For example, a JSA for an outsourcing partner might include the following sections: communication, planning, inventory management, invoicing and administrative, transportation, operations performance review, managing expectations, decision-making, and engineering and technical support.
Table 2. Typical stage-gate process for developing business processes and systems.
Resource Management. Once project priorities are set, choosing which projects get the go-ahead depends on an accurate understanding of available resources. Developing a resource-supply and demand-planning model is straightforward, and can be managed with spreadsheets or desktop databases. The model identifies both the number and qualifications of company personnel, and includes realistic estimates of the time devoted to everyday activities. Use the model to support a resource allocation process. Now managers can prioritize operational readiness projects and schedule them accordingly. The value of the model is that it can be extended to accommodate longer-term resource planning.
Now that project priorities are set, how do you ensure that the business processes under development will be effective, efficient, scalable, and CGXP-compliant? In other words, will you be operationally ready when needed? Best-practice approaches to building process infrastructure use a single, structured, stage-gate project management process (PMP) similar to that used for managing product development projects (3). At this point in a project, senior managers must participate. Leaving the planning to functional managers is inefficient. Many times they don't have the clout or the experience to make the best business decisions.
Best-practice project management processes consist of four key elements: The project approval committee (PAC), project teams, project management process, and stage reviews. In larger companies, IT projects are often managed through separate - yet similar - stage-gate processes. However, smaller companies may find it more efficient to use a single-process structure for efforts focused on building or improving business and operational processes.
Figure 3. Commercial readiness framework with eight key business objectives.
Project approval committee. Convene a cross-functional team of senior managers who have the authority to charter, oversee, and allocate resources among all commercial-readiness projects. Specifically, entrust the PAC with the following activities
Project teams. A small, cross-functional project team possesses the responsibility (and has authority) to deliver clearly defined process improvements. Project team members are representatives from their respective departments and are able to speak on their colleagues' behalf in all working meetings. The team is accountable to the PAC. The following are specific responsibilities lasting through the project lifecycle:
Project Management Process. Guide all business-process development activities with a single, common framework and with standard working tools and templates and defined performance metrics. Group the project lifecycle in distinct stages with clearly defined objectives and deliverables (Table 2), and hold management reviews at the end of each stage.
Given the diversity of processes and systems projects, stage requirements may be relatively generic at a high level and must be tailored to specific project types. While the number and name of the phases will not change, project teams should have the flexibility to combine, split, or even skip stages (subject to management approval). Short-duration projects, for example, may combine the design and development stages. On the other hand, longer, more complex projects may benefit from splitting a stage into two parts and conducting stage reviews after each. Table 2 shows this in the IT column.
Avoid Launch Delay
Stage Reviews. The PAC will evaluate a project's benefits, costs, and risks at the completion of each stage. Stage reviews are decision-making meetings rather than status, brainstorming, or document-review meetings. They enable senior managers to impart their collective experience to the teams at key project junctures while enabling the teams to grapple with the day-to-day details. The timing of stage reviews and decisions are based on the milestones and deliverables defined in the project charters and plans. During the stage reviews, the PAC must evaluate both project progress and business impact and provide the project teams with one of three clear decisions: go (continue project to the end of the next stage), no go (terminate the project), or re-direct (change the project objectives or scope or provide additional information so a clear decision can be made).
Once a single corporate-wide project management process is established, companies can begin chartering project teams. The PAC draws up a team's charter, which generally consists of: objectives, scope, timing, expected deliverables, critical performance requirements, and project team members. With this guidance document in hand, teams can begin developing an approach for addressing their charter. Codify the approach in a project plan that is based on a standard template. Project plans are evergreen documents that cover the entire project lifecycle and typically include the information in Table 3.
Table of Contents Sections and Section Contents
Summarizing the project plan in a one-page "contract" helps the PAC manage a portfolio of operational readiness projects. The contract lists the critical milestones, along with target goals and tolerance ranges. As long as the project team manages the project within the boundaries (tolerance ranges) of the contract, the PAC can be assured that the project is on track. If the team finds that it will exceed a project boundary (for example, the schedule slips significantly), the team is responsible for scheduling an interim stage review to present a plan for getting back on track.
Senior managers must recognize that the project contract is a bilateral agreement. The project team cannot be expected to achieve its objectives without the necessary direction and resources from the PAC. Realize that the contract only covers the next stage of development; project teams do not have a blank check to continue their process development efforts beyond one stage. Managing projects on a stage-by-stage basis ensures that management has influence over the direction of the operational readiness projects in its portfolio. Just prior to a stage review, the project team updates both the project plan and the project contract. The PAC can make its go, no-go, and redirect decisions based on the information contained in these two documents.
Even with an army of consultants, achieving commercial-readiness capabilities for biotech companies takes years, not months. What's more, this big investment of resources often comes at a time of negative profitability. You can approach this task by implementing structured, stage-gate processes to manage a prioritized portfolio of process improvements.
Although this article uses terminology familiar to U.S. readers, the ideas and approach are equally valid for thousands of biotechnology companies conducting clinical research in the European Union. GMP regulations and guidelines in Europe describe the requirement for establishment and implementation of quality systems (4, 5). The ICH guidelines serve to standardize quality systems processes. Furthermore, the EU Clinical Trial Directive, requires that EU member states appoint inspectors to verify compliance of investigational medicinal products with the provisions on GMP and GCP (6). This, then, may push companies to have robust quality systems and procedures in place early in clinical development.
The benefits of an early commitment to process are many. Risks of launch delays due to ineffective quality systems, and manufacturing process development are minimized. Productivity improvements help expedite critical product-development functions, thereby helping to delay hiring within certain functions. Realistic expectations about the untested commercial capabilities of their processes and people make biotech companies better business partners, with increased willingness to seek out their partner's expertise and staff resources. Perhaps most tangibly, "process" is enabling many biotech companies to recapture the fast-paced, entrepreneurial esprit de corps that was lost as they grew past a 50-person start-up. The message is simple: Start building today the processes that will be needed to support the commercial introduction of the products in your drug pipeline.
(1) Ginsberg, B. and McGrath, M., "The R&D Effectiveness Index,"
, 17 (1998).
(2) FDA, "Electronic records; Electronic signature," Code of Federal Regulations Title 21, Part 11 (U.S. Government Printing Office, Washington, DC, revised 1 April 2003).
(3) McGrath, M.E. and Akiyama, C. L., PACE: An Integrated Process for Product and Cycle Time Excellence. In Setting the PACE in Product Development, edited by Michael E. McGrath (Boston: Butterworth-Heinemann, 1996).
(4) EC, Commission Directive 91/356/EEC, Volume 4, Annex 13, Official Journal of the European Communities. Available at http://dg3.eudra.org/F2/eudralex/vol-4/pdfs-en/anx13en030303Rev1.pdf.
(5) EC, "Guide to Good Manufacturing Practice," Eudralex Volume 4, Annex 13. Available at http://pharmacos.eudra.org/F2/eudralex/vol-4/pdfs-en/anx13en030303Rev1.pdf.
(6) EC, Commission Directive 2001/20/EC, Official Journal of the European Communities. Available at http://dg3.eudra.org/F2/eudralex/vol-1/new_v1/Dir2001-20_en.pdf. BPI