Quality of drugs manufactured in emerging economies: Are cost containment strategies heightening the likelihood of substandard drugs in Canada? What regulatory, policy, and/ or governance changes are needed to address new and increased risks? How can Canada prevent and reduce health risks that emerge when the pharmaceutical industry adopts globalized production strategies?

1. Quality of drugs manufactured in emerging
economies: Are cost containment strategies
heightening the likelihood of substandard
drugs in Canada?
CIHR BEST BRAINS EXCHANGE
FRIDAY, JANUARY 22, 2016. CIHR’S OFFICES 160 ELGIN STREET, 9TH FLOOR OTTAWA, ON
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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2. Key Questions
What regulatory, policy, and/ or governance changes are
needed to address new and increased risks?
How can Canada prevent and reduce health risks that
emerge when the pharmaceutical industry adopts
globalized production strategies?
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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3. Speakers & Assigned Topics
• Scene Setting Presentation – Challenge of substandard
drugs for public health
Mark Paxton, Chief Executive Officer, Rx-360
• Tension between the affordability and the access to drugs
that emerges due to cost containment strategies
Suzanne McGurn, Assistant Deputy Minister and
Executive Officer, Ontario Public Drug Programs
Ontario Ministry of Health and Long-Term Care
• What is driving globalized production strategies in the
pharmaceutical industry?
Ajaz S. Hussain, Executive Director, The National
Institute for Pharmaceutical Technology and
Education
• Potential risk factors that emerge, or are increased, when
drug production is performed in emerging economies
Andy Stergachis, Director, Global Medicines
Program, School of Public Health, University of
Washington
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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4. What is driving globalized
production strategies in the
pharmaceutical industry?
AJAZ S. HUSSAIN, EXECUTIVE DIRECTOR, THE NATIONAL INSTITUTE FOR PHARMACEUTICAL
TECHNOLOGY AND EDUCATION
AJAZ@NIPTE.ORG
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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5. Manufacturing in Emerging Economies for Canada,
USA, …:‘Better than Placebo’
“Rest bring data”
Application: NDA,..,
ANDA
“Scale-up & Process
Validation”
CGMP Compliance,
“Certification”
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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6. Globalization Drivers?
Manufacturing in Emerging Economies for Canada, USA,..:
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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COGS
Direct Materials
Beginning Inventory 0
Purchases 9,000
Direct Materials Available 9,000
Ending Direct Materials Inventory (4,000)
Direct Materials Used 5,000
Direct Labor 2,000
Factory Overhead 1,100
Total Manufacturing Cost 8,100
Add: Beginning Work-in-Process Inventory 5,000
Total Manufacturing Cost to Account For 13,100
Less: Ending Work-in-Process Inventory 4,500
Cost of Goods Manufactured 8,600
At a lower costs for
development & manufacturing
Capability to
satisfy
regulatory
requirements in
Canada, US,,..

7. Globalization of costs
& not accounting for
differences in quality
understanding
Served as a ‘stress test’ for the regulatory
systems in Canada, USA,…
Exposed prevailing intra- and inter-agency
heterogeneity and capacity constraints
Eroded public’s confidence in quality;
palpable increase in nocebo effects
Reminded us that complexity and
uncertainty remains underappreciated
Design, Controls, Specifications
CGMP Compliance
QMS & assurance of data integrity
Review & Inspection
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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8. “…..When the drug safety
system fails, people get sick.
Some die. It is hard to detect
harm. Some of these people are
already very vulnerable…
and proving the cause of harm from impurities,
adulteration, and counterfeits can be elusive. FDA
inspectors look for a culture of quality at manufacturing
facilities. Certainly the companies are obligated to ensure
a culture of quality and maintain vigilance as well. This
reflects a systems approach to safety. This system
approach wasn't at play here….”
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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http://www.spokesman.com/stories/2008/apr/23/house-
panel-criticizes-fda-on-foreign-inspections/
Congressman Shimkus

9. Breaches in assurance
of data integrity is a
Global Issue!
•Probe Finds Kaketsuken’s
GMP Violations “Extremely
Malicious”, MHLW to
Impose Penalty(3 Dec.
2015)
Mr. Shiozaki,
Head of MHLW
regrets they could
not find GMP
violation (Dec 8, 2015)
PMDA says
Routine GMP
Inspection to be
done without
prior notice ….8
Dec 2015
Einstein’s challenge….
we will never solve the problems
tomorrow with the same order of
consciousness we are using to
create the problems of today!
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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http://pj.jiho.jp/servlet/pjh/regulatory/outline/1226583374392.html

10. Use of foreign-sourced materials
creates vulnerabilities in the U.S.
drug supply. …FDA has been
working for over a decade to
stimulate modernization
QbD … an opportunity to reduce manufacturing
costs while ensuring that consumers receive high-
quality drug products…. with the proper strategies,
revitalize pharmaceutical manufacturing in the
United States.
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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http://www.pharmaceuticalonline.com/doc/cder-s-janet-woodcock-
nobody-can-really-tell-me-if-fda-inspections-are-effective-0001 and
http://www.fda.gov/NewsEvents/Testimony/ucm378343.htm

11. FDA/CDER/OPQ =
“Integrated”
How did we get here?
Pre-OPS to OPS to OPQ
Assuring Same
Quality Standards
to Safeguard
Clinical
Performance
Enhancing Science-
and Risk-based
Regulatory
Approaches
Transforming
Qualitative-
Quantitative and
Expertise-based
Product Quality
Informatics
Quality Metrics
Question-based
Review
New Inspection
Protocol
Integration of
Review, Inspection,
Surveillance, Policy,
and Research
Team-based
Integrated Quality
Assessment (IQA)
Program Alignment
across FDA
Encouraging
Development of
Emerging
Technology
Quality Information
BLAs/NDAs/ANDA
how does it link to
patients?
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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CDER Office of Pharmaceutical Quality

12. Immediate policy
considerations:
Appreciate
complexity and
uncertainty
• Regulatory review – ask the right questions
• An harmonized, integrated (review-inspection),
life-cycle approach to analytical & process
‘validation’
• Product risk-assessment criteria when deviations
from CGMPs occur
• Quality metrics – supply chain reliability;
distinguish between malicious and misguided
behaviors
• Focus on quality system & systems thinking –
recognize the difference between complicated vs
complex
Risk-assessment & classification
Quality Metrics
Culture of Quality
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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13. Invest in
Pharmaceutical
Technology
Research &
Education
The Nation Needs a
Comprehensive Pharmaceutical
Engineering Education and
Research System. Ajaz S.
Hussain. Pharmaceutical
Technology. September 2005
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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14. Summary
Capability to satisfy regulatory requirements in
Canada, US,…, at a lower development &
manufacturing costs.
Key drivers:
EBITDA
Exposed prevailing intra- and inter-agency
heterogeneity and capacity constraints
Globalization
of costs
Complexity and uncertainty in the assurance of
‘pharmaceutical quality’remains
underappreciated
Non-
compliance:
Global Issue
Product risk-assessment criteria & Quality
metrics – for supply chain reliability; distinguish
between malicious and misguided behaviors
Immediate
policy
considerations
Catch-up with the paradigm long-shifted:
“compounding” to “manufacturing”;
“compendia” to “statistical confidence”
Invest in
Research &
Education
Manufacturing in
Emerging Economies
for Canada, USA,..
Ajaz S. Hussain, Ph.D. @ CIHR Best Brains Exchange, Ottawa, ON, January 22, 2016
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