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Pharma Manufacturing A Portfolio Approach To Achieving Excellence In Pharmaceutical Manufacturing T By Booma Yandava he pharmaceutical industry has traditionally been guaranteed relatively high ROI and profit margins from blockbuster products, thereby enabling investments in drug R&D; rather than in operational efficiencies or cost-containment measures. However, increased global demand for less expensive generics and complex biologics, along with complexities in producing and delivering quality therapeutic products, has resulted in a shift in pharmaceutical product portfolio, manufacturing, and supply chain strategies. In addition, pharmaceutical companies wishing to do business in emerging markets are being pushed to revisit their supplier and collaboration configurations, as well as invest in local manufacturing facilities — a strategy of "in country, for country." As a result of these changes, there is clearly a need to elevate manufacturing and supply chain management to more strategic and tightly integrated roles. Such elevation can be achieved by applying a portfolio approach wherein synergies between the product portfolio, supply chain models, and manufacturing processes are aligned to anticipate demand and quickly adjust output capacity. This paradigm is already being implemented in the technology and retail industries, where product-specific fulfillment and manufacturing are becoming more commonplace. 54 The CMO Leadership Awards 2013 PORTFOLIO APPROACH — ONE SIZE DOES NOT FIT ALL A supply chain portfolio approach to achieving manufacturing excellence is not a "one-size-fits-all" process of converting materials into therapeutic agents via a monolithic, siloed, replenishment-based supply chain. Rather, it is achieved when manufacturing takes responsibility for productivity and process innovation, and responds to global demands by closely aligning with supply chain strategies, driven by the company's long-term strategic and financial goals for optimal performance. The best place to start is with the product portfolio. UNDERSTANDING THE PRODUCT PORTFOLIO Given the highly dynamic nature of the pharmaceuticals industry, business strategies shift, as do their product categories and their associated complexities for manufacturing. Understanding and evaluating a company's product portfolio for core and noncore fit and aligning sources of value creation with the delivery process are both key to understanding how supply chain and manufacturing choices can be evaluated. For instance, manufacturing and order fulfillment demands on biologics are not the same as those of generics or branded therapeutics. While current models tend to limit the analysis of products to demand forecasts, clinical trials, manufacturing costs, price, and other parameters, products must be evaluated in the context of a product portfolio for manufacturing and fulfillment needs. Further, a product portfolio must be assessed for product design, supply chain response requirements, manufacturing flexibility, and financial goals. Examples of such criteria include: • product design and packaging considerations, such as product shelf life, dimensions, quality, and supply base that will feed into the bill of material (BOM) • order-to-delivery needs for each product line, product mix, region, and customer segment to evaluate speed versus predictability • customer/partner integration • cost considerations and asset management goals to align with overall strategic and financial goals • determination of commercialization and manufacturing characteristics early on during the new product introduction stage for complex products • a robust integrated business planning model to support product portfolio management, product commercialization, supply chain portfolio, and manufacturing.