A Culture of Continual Improvement

In August 2007, Schering-Plough’s five-year-old consent decree with the US federal government was dissolved. The company’s aim hasn’t changed. Julia Puppe spoke with Richard S. Bowles III about Schering-Plough’s culture of continual improvement.

In May 2002, Schering-Plough agreed with the US government to the entry of a consent decree of permanent injunction against Schering-Plough, limiting the drug maker’s ability to manufacture, package or distribute products in its Kenilworth and Union plants in New Jersey, and its plants in Manati and Las Piedras, Puerto Rico, because of issues with the FDA’s good manufacturing practices. Now that Schering-Plough has fixed all quality control problems and the consent degree has been dissolved, the New Jersey-based company is all set to move forward.

“Until a few weeks ago, our priority in the quality management area was to accomplish the consent decree requirements at the four manufacturing sites covered by the decree. However, even though our priorities were at those sites, one of our strategies has been to use all of the quality improvement results, techniques and methodologies that were used at those sites for improvements at our other FDA-approved sites. And that strategy has been very successful in the quality transformation of our manufacturing organizations,” says Richard S. Bowles III, SVP of Global Quality Operations for Schering-Plough.

Moving on, Bowles’ hopes and efforts are devoted to further improvement of quality systems, and the development of quality systems for all manufacturing facilities in the supply chain. “Our goal going forward is really harmonization of our quality systems throughout the supply chain. There’s always a great amount of work to do, and we’re very excited about the ability to create some key global systems that apply to all different regions: whether it’s our three key areas – the US, Europe and Japan – as well as the rest of our global supply chain,” explains Bowles.

Implementation challenges
It’s been an exciting journey for Schering-Plough, to say the least. The organization had to be receptive to changes: both to quality improvement methodologies and new quality strategies. Some particular challenges, Bowles believes, arise during implementation. “A  big one is on the interface between research and the commercial manufacturing area. The processes for manufacture of new products are developed in our research laboratories where clinical supplies and clinical studies that define those products are created. After a period of time, typically near commercialization, the technology that’s created, both manufacturing processes and analytical methods for testing products, are transferred formally to commercial manufacturing facilities.”

This interface, Bowles explains, can be a huge advantage, or it can be a huge stumbling block for companies, depending on how well it’s done. “One of our key priorities going back to 2001, when I joined the company, was to put in place an efficient collaborative process between researchers and commercial manufacturing groups to very effectively transfer technology using a cross-functional business process that was created.”

Beyond the cross-functional business process, however, it’s essential to be able to commercialize the technology that’s developed in the research laboratories. Bowles: “That work has to be conducted with an eye toward commercialization; and the way we’ve kept that eye in the manufacturing process is we participate actively in the development of new processes for potential new products. At relatively early stages of development – early clinical trial stages, if you will – we create teams, cross-functional teams between the two organizations that collaboratively guide the development of the technology. What we’ve found from this process is great success in commercializing new technologies for new chemical entities or for new commercial manufacturing technologies that we’ve used.”

Senior management involvement
Another key element, Bowles points out, has been senior management involvement. He calls it the “cornerstone” in Schering-Plough’s quality strategy. Various executives – including CEO Fred Hassan – are directly involved on a frequent basis in the management of quality throughout the organization. The company’s corporate Quality Council, co-chaired by Hassan, reviews initiatives and quality improvement efforts for various products and various processes from all different areas of the company on a monthly basis.

“That senior management attention and involvement, starting at the top, cascades down and gets amplified as it goes through the organization. It tells everyone, in a way that’s not possible using any other technique, of the value and the importance of quality when senior executives are directly involved in the leadership and governance of it,” emphasizes Bowles.

Continual improvement
The corporate Quality Council’s mission has been to create a culture of continual improvement, which, Bowles believes, is different from a culture that operates in a discreet improvement way. “One of the real challenges in creating that culture is to create the understanding that quality is a journey. It’s not a series of projects or tasks – there never is a sense of ‘done’ about it. It continues as a journey and creates a mindset within people in which we try to relentlessly look at opportunities for improvement, in lieu of an environment in which, say, one might decide that our quality levels are adequate and that no additional work is needed,” he explains.

The real step change, Bowles is certain, occurred when Fred Hassan joined the company in April 2003. He took over when Schering-Plough shares had lost two-thirds of their value, when the allergy pill Claritin had lost patent protection and sales had fallen from $3 billion annually to about $400 million, and the company was facing a late-stage pipeline gap. “Fred’s mission as a whole was corporate culture transformation, so our work easily fell under the umbrella of his culture change agenda. He has been one of the biggest champions within the company of our work in continual quality improvement, and our work in turn has been accepted by many of the people in the company as a model of the kind of environment we want to create. So in a sense we were fortunate that we were doing continual quality improvement in a company that was focused on culture change,” Bowles concludes.

Internally, the culture of continual improvement spreads through a lot of communication and the establishment of clear standards and expectations. The broader issue, however, with third parties and other collaborators, occurs at a different level. “We have very detailed standards for how manufacturing and quality improvement activities are conducted within the company; we also have a set of general principles that we call corporate quality policies. Those corporate quality policies pertain to all manufacturing sites. At a principle level, they’re also used to assess any third parties or potential collaborators to assure the adequacy of their quality improvement systems. We can’t apply our quality improvement systems to a third-party manufacturer because the third party manufacturer has to have their own. But we expect when we partner with someone outside of the company that their quality systems speak to the same principles and the same expectations for quality management and quality improvement as ours.”

Measurable quality
Schering-Plough’s quality approach is measurement based, which provides for fairly unambiguous estimates of how well the company is performing. It also provides for consistency from site to site. The time cycle for resolving a customer complaint, for example, is a key metric that Schering-Plough tracks because the company needs to know that complaints are investigated and promptly responded to. “Through our quality measurements, which are an integral part of the quality system and part of its design, we can quite easily get very good indications of how we’re doing.”

There are a lot of enabling factors needed to implement a global quality model, believes Bowles. Different regulatory agencies have different requirements, and it’s difficult to think of a single manufacturing facility whose quality systems speak directly to all the regulatory requirements of all countries. “It’s a huge challenge,” says Bowles, adding: “But externally, we’re working through organizations like the International Conference on Harmonization to create global standards that can be used by all regulators worldwide to assess compliance, and then in turn be used by all manufacturers worldwide to ensure consistent, high-quality standards in their operations.”

A global regulatory standard currently in process is ICH10 Q10. Many companies in the pharmaceutical industry, including Schering-Plough, are actively involved in creating this standard, hoping it will be an enabler to operating quality systems consistently and globally.

Harmonizing regulatory requirements
Internally, Bowles explains in more detail, Schering-Plough has a two-fold approach to quality requirements. Apart from the corporate quality policies that apply to all manufacturing facilities around the world, the company created a set of quality standards that were used for FDA-approved facilities under its work in the consent decree. The standards include specific FDA requirements, for example, in computer validation, that have also been implemented at all of Schering-Plough’s FDA-approved sites.

“One of our goals going forward is to create so-called ‘level II’ standards for all manufacturing facilities around the world, especially Europe and Japan, and this work will provide a detailed set of consistent requirements for those manufacturing facilities, to complement the principles required in our ‘level I’ standards. It is not a simple matter to create a set of quality systems that work in a US environment and a European environment; but it’s a terrific and inspiring challenge to do it, and I’m confident that we’ll continue to make progress on that internally. We’ll continue to see external regulatory progress at harmonizing regulatory requirements globally that then allows us to harmonize quality systems better.”

Challenges
What implementation and other challenges remain? Bowles laughs, exclaiming: “It seems like we’re just beginning! If you were to look at the initiatives that we have and what we’re trying to do, you wouldn’t believe that we have just gone through a six-year process of completely redesigning, improving and certifying our quality system. Looking at quality improvement beyond Schering-Plough’s achievements to date, Bowles aims to simplify systems with an eye toward sustainability. “The list of projects, initiatives and activities we have for information systems, for advanced technology use on the manufacturing floor, and for other business processes is very long. We have a full agenda in front of us for as far as the eye can see – which is great,” Bowles says confidently.

It leaves Bowles with great optimism about the future that Schering-Plough’s people will continue to find ways to improve and simplify business processes. “The environment here is truly unique. We’ve gone through a very difficult period of time, which has brought many groups together, really if nothing more than just for survival. So the level of cross-functional collaboration is unbelievably high at our company, and also the spirit of excitement about the future. The kind of buzz in the hallways here feels like an upstart biotech company in some ways, but in fact, we are a well-established pharmaceutical company.”

Regarding his contribution since joining Schering-Plough in 2001, Bowles believes, is that he has enabled the company’s employees to do what they wanted to do by making sure they have the empowerment, resources and the right number of people to do it. “Luckily, we were able to recruit a lot of very talented people to quality functions between the period of 2001 and 2004, when we were in the middle of all this heavy lifting in terms of quality improvement. Many people left what seemed like very stable companies to join a company that was having both financial and quality problems to help on this journey – and they certainly contributed to what we were able to achieve.”

Richard S. Bowles III joined Schering-Plough in January 2001 as Vice President, Pharmaceutical Manufacturing. In March 2001, he was promoted to Senior Vice President, Global Quality Operations. Prior to joining Schering-Plough, Bowles was employed by Merck, where he held a variety of positions of increasing responsibility in research, quality and manufacturing. From 1992 to 1997, Bowles was VP for Quality in Merck’s manufacturing division. Just prior to joining Schering-Plough, he was VP Merck’s Latin American and Puerto Rican manufacturing operations.

ICH10 Q10 Objectives

• Achieve product realization
• To consistently provide a product of the quality necessary to meet the requirements of patients, health care professionals, regulatory authorities and internal customers
• Establish and maintain a state of control
• To use effective monitoring systems for process performance and product quality providing assurance of continued capability of processes
• Facilitate continual improvement
• Identification and implementation of necessary product quality improvements, process improvements, variability reduction, innovations, and PQS enhancements, thereby increasing the ability to consistently fulfil quality requirements. Risk management techniques may be used to identify necessary areas for improvement

[Source: Joe Famulare, Deputy Director, Office of Compliance, Center for Drug Evaluation and Research, FDA]

Relationship of Q10 and GMPs

• Q10 builds upon regional GMPs and ICH Q7
• Q10 describes certain quality system elements and management responsibilities that foster continual improvement. 
• Q10 bridges regional GMP regulations and helps to achieve a harmonized lifecycle approach to pharmaceutical quality systems

[Source: Joe Famulare, Deputy Director, Office of Compliance, Center for Drug Evaluation and Research, FDA]