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Varna Medical Forum

Approach to cost-of-quality management in pharmaceutical manufacturing

Reneta Stefanova

Abstract

Introduction:

The costs related to pharmaceutical production, including quality costs are a substantial and persistent part of the costs of pharmaceutical companies. Moreover, there are a number of activities in pharmaceutical production, originating from regulatory requirements to ensure the quality of pharmaceuticals, which do not contribute to real value; however, they consume time, materials and human resources. One of them is the operation of an effective quality management system in accordance with the requirements of the Good Manufacturing Practice for pharmaceuticals. The adherence to all regulatory requirements related to pharmaceutical production is quite costly and constitutes a substantial part of the budget of pharmaceutical companies. There are, however, opportunities for cost reduction which can increase profit without extra investments, ensuring at the same time regulatory compliance.

Materials and Methods:

A scientific literature review was performed with regards to cost management in pharmaceutical production. On the grounds of the analysis, personal experience and observation, some factors were identified which could impact the costs of pharmaceutical manufacturers and an approach for their management was developed, aiming to reduce the costs and improve company performance.

Results:

The costs for materials, equipment, production process, personnel, control and facilities were identified as major sources of production costs in the pharmaceutical industry, which affect the quality costs. The costs were classified by type and specific approaches for cost reduction were proposed; the expected effects of this reduction on the company results were assessed, e.g. reduction of total costs, losses and product unit costs, reduction of the duration of production, reduction of downtime and the time required for preparation and effective use of facilities, as well as quality costs (for assessment, prevention, internal and external issues/failures).

Conclusion:

The proposed approaches for cost reduction can be used as a manual for cost assessment, as well as for the suitability and prioritization of the relevant approaches for their reduction. They have a major impact on the “good quality” costs, related to assessment and prevention; they also contribute to the reliability of quality assurance, thus reducing the costs for its application for handling of internal and external issues. The proposed approaches have a synergistic effect on quality costs reduction and on the improvement of company performance.


Keywords

cost of quality, quality cost management, cost reduction, pharmaceutical manufacturers, quality management system

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