Introduction
In the pharmaceutical industry, managing manufacturing costs is critical for maintaining competitiveness and profitability. SI Insights specializes in conducting comprehensive cost benchmarking studies for pharmaceutical companies, focusing on Active Pharmaceutical Ingredients (APIs) and finished product manufacturing. This white paper outlines key cost drivers and challenges in pharmaceutical manufacturing, offering insights into our approach and methodology for cost benchmarking.
Key Cost Drivers in Pharmaceutical Supply Chain
- Raw Material Sourcing
- Source of Material: Understanding the origin of raw materials, whether domestic or international, can impact cost.
- Documentation: Regulatory and documentation requirements can add to the cost.
- GMP Status: Good Manufacturing Practice (GMP) compliance status affects the sourcing process.
- Availability: The accessibility of raw materials from various sources influences pricing and supply stability.
- API Process Parameters
- Benchmarking Against Sales Price: Comparing API manufacturing costs with the current sales price in Rest of the World (ROW) markets to identify potential cost reductions. ROW players typically operate with a 15-20% gross margin.
- Process Patent Issues: Identifying any process patent restrictions that could limit the use of competitive manufacturing routes.
- Physical Specifications: Different Particle Size Distribution (PSD) requirements can increase the cost due to milling, sifting, and material loss.
- Reprocessing Steps: Introducing reprocessing steps in the Drug Master File (DMF) can affect costs.
- Solvent Impact: The cost and recovery of solvents used in the manufacturing process.
- Finished Dose Manufacture
- Excipients: Availability and cost of excipients are key parameters.
- Manufacturing Process: Adopting simpler processes like Dry Granulation unless specific techniques are required.
- Batch Size: Defining real batch sizes based on commercial requirements.
- Testing Requirements: Committing only to essential tests for batch release to control costs.
- R&D Practices: Ensuring R&D uses commercially available materials to avoid unnecessary costs.
- Coating Processes: Minimizing film and sugar coating to reduce time and expenses, etc.
- Packaging & Stability
- Market Requirements: Understanding target market needs and packaging counts.
- Stability Costs: Using bracketing approaches where suitable to minimize stability testing costs.
- Zone IV Requirements: Evaluating the need for Zone IV conditions, which can be capital intensive and affect product stability.
Case Study Example
Tranylcypromine Case
- Challenge: An excipient produced only by Merck is required in small quantities, but Merck sells it only in large packs, leading to excessive costs and supply issues.
- Impact: This situation highlights the importance of sourcing strategies and managing supplier relationships to avoid excessive costs and ensure consistent supply.
Our Approach
Customized Analysis
Each benchmarking study is tailored to the specific requirements of the molecule type and manufacturing process. We conduct a thorough analysis considering all relevant factors.
Comprehensive Cost Evaluation
We evaluate all cost aspects, including API procurement, supply chain logistics, and manufacturing operations, to provide a complete picture of the manufacturing cost structure.
Multifaceted Perspective
Our analysis considers location-specific cost variations, regulatory requirements, and market dynamics to offer a holistic assessment of manufacturing costs.
Accurate Data Analysis
Our team ensures data accuracy and reliability, providing precise insights into cost benchmarks and identifying areas for improvement.
Methodology
We leverage the expertise of our enriched expert panel, comprising researchers, scientists, manufacturing and supply chain experts, business development specialists, regulatory professionals, buyers, and sellers. This diverse network ensures access to a broad range of knowledge and perspectives in the pharmaceutical industry.
Conclusion
SI Insights' commitment to delivering valuable benchmarking studies has earned high praise from our clients. By providing actionable recommendations and precise insights, we help pharmaceutical companies optimize their manufacturing costs and enhance their market competitiveness.
If you require manufacturing cost benchmarking assistance for your specific molecule type and manufacturing location, we are ready to offer our expertise and support.
Contact Us:
- Email:[email protected] · Web: https://siinsights.com/ · Phone: +91 7506221809