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www.chemicalsknowledgehub.com


reduced export incentives and subsidies.


This series of changes put


raw materials manufacturers under financial pressure. Some closed in the face of changes that rendered their operations financially unviable, while others moved their facilities to new locations. The resulting disruption in raw material manufacturing rippled through the global pharmaceutical supply chain.


Recognizing a threat


As Chinese raw material suppliers reduced output or closed entirely, global companies struggled to maintain timely, consistent access to the affordable materials on which they had become reliant. Piramal Pharmaceutical Solutions (PPS) was one of many businesses affected by the disruption to the supply of raw materials.


PPS responded to the changes in China by taking a long view of the situation intended to ensure business sustainability. The supply chain team at PPS took that position after identifying the new environment in China as a mid- and long-term threat, not a passing disruption. In the absence of mitigating measures, PPS predicted the changes in China could lead to a range of negative outcomes. The inability to guarantee timely, consistent supply of Chinese intermediates could lead to missed delivery dates, increased costs, deterioration of customer


PPS success stories


The PPS China Risk Mitigation Initiative has achieved many successes. Below is a snapshot of the ways the initiative has made a difference to the resilience of PPS’s supply chain: • PPS worked with two custom synthesis partners to quickly develop a bromo- compound after a Chinese supplier stopped production and threatened the launch of a late-phase drug candidate. The collaboration enabled the company to meet all pending finished product orders.


• Amid the COVID-19 pandemic, PPS and its Indian outsourcing partner developed a key starting material for an antiretroviral product and completed validation batches in eight months. The fast turnaround mitigated the impact of a change in manufacturing location at a Chinese supplier.


• PPS and its two manufacturing partners developed and secured customer approval for a forward-integrated stage in five months. The work was done in response to effluent-related disruption at a key starting material supplier for a generic product.


• PPS fulfilled a rush order of a critical raw material in four months. The customer became aware at the last minute that due to patent restrictions, a Chinese supplier was not authorized to sell a critical raw material, forcing it to switch to a major specialized chemicals supplier which tech transferred this product from its US base to India and supplied the required quantity within 3 months, without patent issues.


Issue 2 • March/April 2021 21


confidence, and loss of business. In short, the situation threatened the sustainability of PPS’s business. Acting proactively before the threat became critical, the Global Supply Chain team at PPS established the China Risk Mitigation Initiative by bringing together a dedicated team of employees from its Indian and Chinese offices. The team came together in early 2019.


Acting to minimize risk


The risk mitigation team initially worked to categorize and prioritize raw materials used by PPS. That first phase of the project grouped raw materials based on


whether they were used in new or commercial products and ranked them against certain risk criteria. The risk criteria covered details such as the commercial potential of a product, manufacturing location, whether it had a single source, current availability, reliance on China, and procurement value. Through that analysis, the team ranked its raw material list to establish the next steps. Based on the extent and nature of the threats linked to a raw material, the team proposed tailored risk mitigation strategies intended to deliver fast, efficient, effective, and sustainable results.


One proposed strategy was to


Pharma: Outsourcing


identify custom synthesis partners and work with them to develop and scale up advanced intermediates. In assessing whether a company would make a suitable partner, PPS looked at its infrastructure and capabilities to understand whether it had the facilities, ability to scale up, analytical, chemistry, sourcing skills, and level of expertise and experience to deliver the intermediates. The assessment also factored in market feedback on the reliability of the partner, information on its financial strength, the number of patents, and its quality accreditation. PPS evaluated about 25 potential partners against those criteria and


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