March 29, 2020

Pharma Companies Can’t Afford to Make These 5 Mistakes

Pharmaceutical companies bear heavy responsibilities. The world looks to Big Pharma to research and develop new generations of drugs—some of which stand to save thousands or even millions of lives and help patients manage debilitating conditions. They also look to pharma to manufacture those drugs to exacting standards and to distribute them fairly and ethically to the entire world.

The world is watching, but regulators are also watching. Pharma companies labor under some of the most exacting regulations in the world. And with good reason—with millions of lives on the line and hundreds of jurisdictions to cross, the stakes could hardly be higher. It’s in everyone’s’ interest that pharma gets it right.

So no pressure. Right?

Today’s pharma companies, from the major players to the up-and-comers, can’t afford to make these five mistakes as they march us into a healthier future.

Quality Control Failures

Nothing betrays the promise of a lifesaving medication like a bad batch, manufactured or stored under non-compliant conditions, and revealed to be compromised when it reaches the end-user.

Quality control failures can also result in failed compliance audits. Regulatory boards can withhold certification and bring production to a halt.

Pharma companies can guard against quality control failures by:

  • Taking quality control seriously, with full-time quality experts on staff so that the buck stops with someone.
  • Take environmental monitoring seriously, deploying top-of-the-line data loggers and excursion alerts according to a well-thought-out plan of action.

Basic data loggers can keep an accurate record of the conditions—temperature, humidity, pressure, etc.—under which medications are manufactured, transmitted, and stored. The logger won’t alert you, however, if a shipment of medications overheats while on the open sea and arrives at its destination unsellable.

Pharma companies should consider investing in intelligent, Cloud-based monitoring, which is offered by companies like Dickson, both to protect their products and to easily track and generate reports to prove compliance with regulations and prevent costly interruptions.

Failure to Adapt to Regulations

The pharmaceutical industry is one of the most heavily regulated industries and with good reason. Ineffective drugs could be ineffective as a treatment for debilitating or life-threatening conditions. Tainted drugs could even cause health crises of their own.

Pharma companies need to invest in compliance professionals who can keep abreast of all changes in the regulatory landscape that apply to them. It’s too much to juggle outside-the-box R&D, airtight manufacturing, and scanning the deep pages of the news for ill-publicized regulatory changes. No one may notice until a failed audit shuts production down.

The regulatory landscape is also responsive to political forces. Big changes accompanied the health care debate of 2008 that lead to the Affordable Care Act, while politics can change the direction of regulatory bodies like the FDA in the U.S. and the WHO globally. As they map out their regulatory compliance plan, pharma companies can’t afford to take their eyes off the politics. Contingencies need to be built in to respond to any curveballs a governing bureau might throw at them.

Regulatory bodies look closely at the conditions under which drugs are developed and manufactured. Make sure all environmental data recorders are calibrated to sensitivity and intervals that regulatory bodies will accept but make sure they have the capability to adapt if the rules change and become more stringent.

Approval Roadblocks for New Chemicals

Drug R&D often depends on the discovery of new chemical compounds, also known as “new chemical entities” (NCE). Pharma companies need to adapt to the reality that regulatory bodies have adopted higher safety standards than in the past. As a result, fewer NCEs are earning approval from the FDA and other governing bureaus.

While this may result in increased consumer protection, it has also led to a decline in the number of blockbuster drugs that have hit the market since big pharma’s early 2000’s heyday.

The needle becomes even harder to thread when you consider that the R&D process on a new drug can stretch out 10 years or longer.

When working with NCEs, pharma companies have to weigh the potential for life-saving breakthroughs against the chance that an NCE will achieve regulatory approval and calibrate their R&D expenditures and price projections accordingly.

Failure to Adapt to Emerging Markets

The U.S. is still the biggest consumer nation for the output of the pharmaceutical industry. China and India are also big factors, considering these nations encompass a third of the world’s human population.

Just as important, however, are “underserved markets”—countries with healthcare needs not being met due to a lack of access to critical medications. This can be true even of countries with financial resources and a reasonable developmental index, like Brazil, Poland, and Russia.

This creates a complex problem for pharma companies—how do you navigate the same product across all of these jurisdictions? With different regulatory, customs, tariff, and currency considerations to consider, the pricing of the product becomes a thorny issue with tricky PR implications. How do you justify charging a different price for the same drug in one country compared to another? However good the reasons, be prepared to justify them.

Failure to Innovate

The discovery-to-market costs of a new drug have increased from a median $137 million in 1976 to over $800 million today. Between that and the declining approval rate of new medications, many pharma companies succumb to the temptation to limit their innovation and instead submit slightly modified versions of the same drug for a new patent. It’s like a film company making the surefire bet on a blockbuster sequel rather than a new idea.

As appealing as this may be to a cost-saving stopgap, it can’t sustain companies forever. Public outcry over the practice and expiring patents have led the generic market to surge—up from $15 million before the 2008 great recession to over $30 million now.

As difficult as innovation may be in the new regulatory landscape, it can’t be neglected entirely. The “greatest hits” approach is a house of cards. Pharma companies have to innovate to achieve longevity. Smart pharma companies will innovate ways to claim their own piece of the generic market, rather than trying to charge high prices for the same old product.


Pharmaceutical companies face more challenges than ever before: exacting and fluid quality standards, a global market to navigate, PR landmines at every turn, a market that discourages innovation and yet expects miracles.

Companies who answer the high calling to invent and produce life-saving drugs have their work cut out for them. We’re rooting for them to take all the precautions necessary to navigate this minefield because the health of generations will depend on their success!

About the author 

Anu Balam

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