Pharma Sharpens its Game: Results of Our First OpEx Survey

How well are your competitors’ Lean, Six Sigma and other operational excellence programs progressing? Is pharma’s manufacturing culture really changing? Our first survey highlights strengths and gaps.

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By Agnes Shanley, Editor in Chief

The drug industry has begun to embrace the principles of the Toyota Management System, the Japanese reinterpretation of concepts first advanced by Deming, Ford and Shewhart. It may have arrived at this point some 20 years later than in other manufacturing sectors, but more drug companies are taking a systematic approach to improving the way that they develop, manufacture and distribute drugs.


Editor's Note: The majority of the graphics (pie charts, tables, etc.) for this article appear at the end of the article. In some cases, as at left, live links (in blue) will be provided to allow readers to "jump" directly to referenced information.

Pharmaceutical Manufacturing, with sponsorship by Invistics Corp. (see "Who Took the Survey?" below), recently surveyed industry professionals to get some idea of how many of its readers’ companies are on the path of operational excellence, and to lay the foundation for tracking their progress. This article summarizes some of our findings.

Some 114 individuals responded to this initial survey (see "Who Took the Survey?" below), most of them from brand name drug companies, nearly 20% from generic drug manufacturing companies, and about 10% from contract manufacturing firms. Over half responded anonymously, and over 90% answered “off the record.”

The number of responses varied with each question, with a core group of 50 replying to every question in the survey. Although the sampling is small — and our survey a “work in progress” that will develop into a statistically relevant sampling over time — results still offer a glimpse into pharmaceutical manufacturing practices today, highlighting achievements as well as areas where improvement is needed. They also suggest that some drug companies are only beginning their operational excellence and continuous improvement programs.

Among the encouraging trends:

    • Most respondents describe their facilities’ operational excellence programs as closely aligned with their companies’ corporate missions and overall business goals;

    • For the most part, respondents say, they are getting clear key performance indicators (KPIs) from management;

    • Manufacturing teams are viewed by most respondents as being critical to improving efficiency and performance;

    • More companies appear to view plant and equipment maintenance “strategically”;

  • Companies are working continuously to reduce set-up times; many of them report that they have already achieved results.

Trouble spots

Other findings were inconclusive, or potentially troubling:

    • While 56% of respondents believe that top management views their facilities as profit centers, 44% think that corporate management sees them as cost centers. 57% of generics manufacturer respondents say that corporate managers view manufacturing as a cost center;

    • Customer input may not be as integral a part of the overall improvement process at drug manufacturing facilities as it is in other industries;

    • Nearly half of the respondents note a need to motivate continuous improvement from the plant floor-level up;

    • Most respondents say that their facilities and organizations aren’t tying manufacturing employees’ compensation to plant efficiency and product quality improvements that they make on the job;

    • At some facilities, manufacturing employees may not be taking ownership of QA and QC, believing that these should be left to the quality department;

    • Cross-functional training and product development appear to be issues for some companies; several respondents note a lack of communication between R&D and manufacturing;

    • "Visual" workplace strategies such as 5S and minimization of waste and motion appear to be less developed at drug manufacturing facilities than they are in manufacturing plants in other industries;

  • Respondents cite “process innovation” and “reducing product prices” as low in their companies’ priority lists.

In addition to asking manufacturing professionals about their priorities and views of key manufacturing issues, we also asked them to describe how their companies were performing overall, compared with top competitors (see the following graphics).


OpEx story: Culture & Operational Excellence tables




We also analyzed responses from those who felt that top management viewed their facilities negatively (see "Facility Self-Image" below).

Business and manufacturing priorities

Respondents are clear about what keeps them, and their managers, up at night. Overall, they view their companies’ top priorities as: increasing operating efficiency, reducing manufacturing costs, and assessing customer needs, which between 73% and 78% of respondents describe as either “extremely important” or “important.”

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