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Tomorrow's Drug Manufacturing: How the Pharmaceutical Industry Fights Cost Pressures

| Author / Editor: Anke Geipel-Kern / Anke Geipel-Kern

Identifying Trends: What Will be Normal in Future?

McKinsey partner and management consultant Ulf Schrader had his own view of the controversial issues, which were bound to be hotly debated. Indeed, some of the listeners questioned whether a sector which makes products for health and is therefore subject to strict regulatory oversight should be faced with the same productivity standards as, for example, the automotive industry. Schrader was keen to introduce his audience to the "new normality" in his keynote speech. He particularly bemoaned the low productivity in comparison with other branches of industry, saying that the pharmaceutical sector was producing at a three-sigma level while production in the automotive industry was twice as high, and that the stability of the processes was well below the maximum.

Information from more than 30 pharmaceutical companies is fed into the Pobos database and the resulting anonymous productivity comparison is fascinating, showing a broad spread. There is a group of companies which are well out in front in terms of productivity, he continued, but none which attain the role-model proportions of Toyota in the automotive industry.

Pharma–Companies Aiming for Operational Excellence

Operational excellence is undoubtedly an important trend in the production of pharmaceuticals. This may not be a new topic but there is obviously still a need for action in this area, as highlighted by Jörg Wassenhoven, Director of Operational Excellence at Takeda, in his address. The managers of the Japanese pharmaceutical company have been working on a five-phase roll-out of a business assessment process since 2012 with the aim of reducing operator costs. Central to the initiative is the value stream mapping process which Takeda is using in the first instance to analyze the top products and to standardize the definition of opex.

Employees are attending three-month workshops designed to raise their awareness and ownership of the process but, as with every opex initiative, the skill lies in breaking the abstract term down into bite-sized pieces of practical relevance. For example, the operators are now recording reasons for downtimes involving machine breakdowns of more than three minutes based on a predefined guide. And—as was to be expected—interface management has been identified as a major influence...

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