Adopting Technology To Improve Efficiency for Life Science Companies.
In 1943, Thomas Watson, the chairman of IBM, made the following now infamous statement about the potential impact of technology, “I think there is a world market for maybe five computers.” 1 It would be hard to express in words how shortsighted his view was.
Amazingly, this misunderstanding of the potential advantages of technology still exists in the mindsets of many otherwise intelligent and successful people. For example, it was just a few years ago that a successful vice president of sales asked me, “Even if I had a computer and access to the Internet, what would I do with it?” To me this was like asking, “If I had a car, where could I go with it?” Yet, a few months ago, when this same VP of Sales’ laptop crashed, you’d have thought he had been paralyzed from the neck down. He simply couldn’t function. Every aspect of his life from social activities to his job came to a screeching halt.
It’s a well-known fact that pharmaceutical and medical device companies are slow in adopting some of the most basic technologies. Clearly, this attitude is hurting their productivity, quality, and time to market. However, what’s worse is that a basic misunderstanding of the potential advantages of electronic solutions still pervades these industries, especially among small- to mid-sized companies. All you have to do to substantiate this claim is attend the lectures at various life science-oriented regulatory or quality control conferences. When discussing fundamental issues, such as process management, compliance, document control, training, submissions, etc., these “experts” rarely discuss using the latest technologies to solve some of their most basic problems. I even heard one experienced consultant say, “The use of massive amounts of paper will never be replaced by electronic formats in this industry.” This sounds amazingly similar to the statement made by Thomas Watson back in 1943.
Given the obvious tendency toward technology of literally every other industry in the world, it’s only a matter of time before the antiquated, paper-based strategies currently in use within the life science community will be completely replaced by their far more productive electronic counterparts. In fact, it seems likely that the FDA will demand such changes in the not-too-distant future. Yet, at present, most small- to mid-sized companies are still in the rut of using the same paper-based processes that their predecessors used decades ago. As a result, they are falling behind in the market and losing literally billions of dollars in unrealized revenue. For example, here are a few statistics that should scare even the most techno-phobic life science professional:
According to Forrester Research, between 2000 and 2005, the pharmaceutical industry lost an estimated $40 billion dollars because of expired drug patents, including $15 billion in 2005 alone. 2 Many, if not most, of these delays could have been avoided, had these companies employed some of the latest software technologies to help them manage their GxP processes and documentation.
According to an ongoing study at Tufts, the cost and time of bringing a drug to market jumped from $231 million and 8-10 years in 1990, to $802 million and 10-12 years in 2001, to the current estimate of more than $1 billion and 12-14
The Gartner Group estimates that about 80% of a company’s documents reside on users’ desktops and that about 25% of those documents are subject to regulatory compliance. 4 Due largely to a lack of adequate document management technology, these documents are frequently lost, stolen, incorrectly approved, and/or experience revision control problems – all of which cause needless delays and added costs.
In May 2006, subscribers to CIO Magazine were invited to take an online survey. Here are some of the key findings of that survey: 5
These data, as well as many other statistics that could be cited, indicate a clear need among life science companies to begin adopting technology at a much faster rate. If they don’t, delays will continue to occur and costs will continue to rise. It’s as simple as that.
Identifying the Problem
If we are going to intelligently address this problem, we must first understand it. The common reasons given for not adopting technology generally focus on the cost of software applications, the effort associated with implementing them, or the hassle of validation. Although these are real issues, they aren’t the real reasons why life science companies don’t adopt new technologies. The real reasons have to do with their priorities. Most life science companies will spend vast amounts of money and effort in other areas of the product development process. Yet, they skimp, postpone, or completely abandon anything to do with the need for new software that could make that development process many times more efficient. So what is going on? Why are life science companies so reluctant to adopt new technologies that would help them be more successful? More than anything else, the real problem seems to be associated with misunderstanding the advantages of technology and a simple fear of change.
Speaking specifically about EDC (Electronic Data Capture) software, Dr. Steve Arlington, who heads the Global Pharmaceutical & Life Sciences Advisory Services at PricewaterhouseCoopers, and is the lead author of the recently released report, “Pharma 2020: The Vision,” (which covers the evolution of the pharmaceutical industry), had this to say about why pharmaceutical companies are so far behind in adopting new technologies:
“I don’t think the barrier to EDC implementation is actually the technology. The barrier is the ability of the industry to accept the changes to the processes required. It requires you to do things differently. It’s that age-old discussion; you can wait to see what the future brings you, or you can start getting involved in what the future can bring you and actually influence it.
“The point of the issue is trying to get technology accepted, and the communication of how good those benefits have to be to a point where you make some sort of change. It’s about emotions. It’s about human intelligence, but emotional intelligence. In essence, a lot of organizations miss the complexity of how to make that happen inside their own environment.” 6
Likewise, Jane Clarke, Senior Director of Clinical Trials Operations Support at Wyeth Research, believes one reason companies have been slow to adopt e-solutions is a lack of vision regarding the potential of these applications for drug development:
“Pharma is a highly regulated industry, thus very conservative with non-paper systems…The real leverage [of specialized software applications] is the total integration and flow of data captured at one point and flowing through other systems.” 7
Finally, Nora Dyer, Global Head of Clinical Development Operations at Novartis, suggests that a lack of understanding among key decision makers is often the biggest hurdle when trying to adopt an electronic solution.
“Adoption of e-solutions is hindered when important stakeholders do not clearly understand and support the overall business rationale, and don’t drive towards the change. Therefore, an effective communication strategy using multiple channels to reach the end-user is essential for a successful implementation. In addition, people in key positions need to manage expectations, recognize setbacks, and also highlight achievements.” 8
Thus, while the cost and effort associated with implementation are often cited as reasons for delaying the adoption of new technology, more often than not the real reasons have to do more with a lack of understanding of the advantages these technologies bring, and a fear of changing the current process to something new and unfamiliar.
“We are entering an era in 2008 and 2009 where we’ll actually have content-management solutions available to pretty much all pharma and biotech organizations, from the start-ups to the VC-funded 20-person organizations, all the way up to the large guys…In the last couple years we’ve seen [software applications] mature to the point where there’s a much broader reach. We’ve seen the maturity of software products built specifically to address life sciences’ regulated-content management.” 9
Jon Beckstrand, CEO of MasterControl, Inc., a firm that produces GxP process and document management software for life science companies seems to agree.
“A few years ago, a high-quality, GxP management application was generally viewed by many companies as either too expensive or too difficult to validate. Today, there are solid solutions for literally all budgets, and over 90% of our new customers purchase automated validation packages to greatly reduce the headache associated with implementation and validation of their
Mary Collins, Director of Regulatory and Industry Relations for Image Solutions, Inc., a supplier of imaging technologies in electronic new drug application development, sees the life science community being forced to adopt new technologies in order to remain competitive.
“No matter how you get started [implementing electronic solutions], you [must] get started now. Over the next 10 years, you will see the different regions of the world come closer together and harmonize more on electronic requirements, and, to some extent, their regulatory requirements.” 11
In fact, according to Life Science Insights, an IDC company, over 60% of survey respondents cited GMP/GCP/GLP processes as the main driver for increased IT spending. In this same survey, 62% of respondents said they intended to spend more on electronic data integration tools. When asked why they intended to spend more, their main reasons (in the order cited) were: increased collaboration, regulatory compliance requirements, reduced time for one or more processes, and reduced costs for one or more processes.12
However, it’s important for companies to understand that it’s not just the purchase of new software applications that will make them more successful. It’s the commitment to change and a dedication to full implementation of a new package throughout the organization that ultimately leads to success. As Ms. Dyer from Novartis explains,
“From the beginning, we established a strong emphasis on regular communication and training, internally and externally, with investigators and research staff. It’s important to recognize that the technology is only a tool in the process. Mindsets must be adopted to establish a new e-way of working. It’s important to keep the process as simple as possible. But when you commit to a solution, you should support its rapid and complete adoption.” 8
What Are The Results?
For example, in the Fall 2004 issue of Pharmaceutical Manufacturing, Novartis claims that using electronic solutions cut the company’s costs by 40 percent and improved cycle times by 70 percent at its site in Suffern, New York. Novartis further claims that one of the keys to their success involved incorporating the solution into many aspects of the organization, including the direct labor areas, quality, IT, and maintenance.13
NAMSA, a medical device company founded in 1967, recently experienced the change from traditional, manual processes to automated, electronic processes. Lisa Swartz, a NAMSA document administrator, who’s been with the company since 1987, explained their transition in these terms:
“Most people don’t like change in general. They’re used to the old way of doing things. For years and years, we’ve done everything manually. The process was cumbersome and time-consuming, but I was used to it, and it worked for me. [But] it was more difficult for other people. They had a hard time adding input, approving documents, and then preparing for training. [Since we’ve implemented GxP management software] we’re actually changing more documents and doing more work now, precisely because we’re more efficient and capable of doing more. If I see that one change applies to 10 other documents, then I go ahead and make the change in all of them. [The technology] definitely helps us maintain compliance. Everything has worked out well.” 14
Mallinckrodt Baker, Inc., founded more than 130 years ago, is also a relatively new convert to the advantages of adopting new software to manage GxP and other processes. According to Gary Jerabek, Senior Quality Engineer at MBI:
“We have vastly improved our change control process and this is, in no small measure, because of [the new software package we’ve implemented]. The auditors gave very favorable comments about our system. They noticed that everything was easily traceable, documents were readily available, and electronic signatures were all there. The fewer hardcopy documents we have, the less chance there is of having obsolete SOPs [on the shop floor]. We can now approve documents globally. Our users come up with new ideas about how to use [the technology] all the time. Everybody is impressed by how fast we can accomplish things now. I’m very happy with it.” 15
A few years ago, Weider Nutrition implemented document management technology throughout all its departments. The technology was initially used to automate (on a daily basis) a total of 46,000 documents, anywhere from 200 to 800 packets, and 70 routes. Ann Clock, Director of Document Management at Weider, explained the main benefit:
“Being the first to market with an innovative product is crucial in our industry and [using our technology] is the key to making this happen.” 16
Similar results can be found among most life science companies that have effectively implemented new software applications to help them manage their documents and processes. As FDA Commissioner, Mark B. McClellan, is quoted as saying:
“Other high-tech industries with essentially no tolerance for errors or impurities, such as the semiconductor industry, have achieved enormous productivity gains in manufacturing in the last 25 years. We should expect nothing less from the pharmaceutical industry.” 17The bottom line for life science companies trying to compete in today’s high-tech world is that adopting new software technologies is no longer a luxury or superfluous to a company’s success—but, rather, an essential key to success in an industry that’s becoming increasingly competitive. Those who adopt this view are far more likely to succeed than those who do not.
For related information, you can download a free white paper entitled, “How Effective Document Management Helps Pharmaceutical Companies Accelerate Time to Market.”
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