Connecting Pharma’s Top Managers and its Operations: Pfizer’s Nat Ricciardi Outlines Challenges at `06 ISPE Meeting

I was recently taken to task by a top executive at my company for an editorial that appeared in October's issue of Pharmaceutical Manufacturing.  He saw the piece as overly critical of senior management, manufacturing and the industry in general.  Its intent was to criticize only those senior pharma managers who have become "detached" from those who create their products, and from the patients who buy them. Such detachment is dangerous, because it negates the impact of  "Operational Excellence" programs and fuels the public's negative opinion of the industry.  At some drug facilities and companies, Lean Manufacturing and Six Sigma founder because they don't have real top-down support.  At these companies, manufacturing still is not viewed "strategically." And, if the industry's average inventory turns are 2, its capacity utilization under 30% and over $50 billion/yr is being wasted in manufacturing today, it's clear that quite a few such managers still exist. Those on the front lines have, no doubt, wrestled with incoherent messages from these managers, and struggled with difficult implementations.  Some have, despite all odds, made progress, only to find their jobs completely eliminated.  At the same time, little emotional connection has been made between those doing the work and the patients that they serve. Far from being corny, such connections energize people so that each operator becomes more mindful of the importance of each procedure, however mundane or tedious.  It's exactly such connections that make Lean projects more effective. So I was glad to hear a top pharma manufacturing executive, and someone who clearly does not suffer from this "detachment,"  articulate some of the challenges ahead. Nat Ricciardi, president of global manufacturing for Pfizer, and a product of New York schools---Fordham for his MBA and City College of New York for his B.S.Ch.E.---opened the 2006 ISPE annual meeting with a talk about the upcoming "golden age of engineering and manufacturing" and the opportunities for innovation that today's challenges (tighter capital spending budgets, increasing complexity) open up.  He echoed former CEO McKinnell's call for a more "preventive focus" to healthcare (a statement that  few people would argue with---although it contrasts with some of the industry's established practices, e.g. its promotion of treatments for  such things as "social anxiety disorder.")  Ricciardi also pointed out that soon, under Part D,  the U.S. government will pay 52% of prescription costs.  Learn from Other Industries: "SWIPE" Ricciardi exhorted manufacturing professionals to build a strategy around innovation and to steal lessons from industries from outside of pharma, or to "swipe," or "steal with integrity and pride from everywhere." At the individual facility level, he spoke of the need to increase capacity utilization and of the benefits of continuous processing (which Pfizer uses for Listerine and is applying to more pharma processes).  Green Chemistry, Outsourcing He also spoke compellingly of the need to embrace environmentally friendly technologies, to eliminate pollution and waste. Given the long-standing fear of changing validated processes and procedures, pharma has been behind the curve in this area (with the notable exception of a few companies, one of them Pfizer). Ricciardi  also spoke of the pressure on pharma management today to "outsource." As he said, China and India are now building their development and manufacturing infrastructures;  as these mature, the costs of manufacturing in those countries will increase , so that in 10 years [others put the figure at 20], they won't be nearly as competitive as they are today. Not to sound parochial or US-centric, since this is a global industry, but it would be tragic for the U.S. to surrender much more its drug manufacturing base, without first having another tangible outlet for its skilled workforce.  Ricciardi hinted that building a culture of innovation within manufacturing, and actively supporting OpEx programs, will demonstrate a competitive advantage to keeping more operations wherever they are (whether that's in the U.S., Puerto Rico, Ireland,  India or China) negating the pressure to outsource. Will that happen soon enough in the U.S., one wonders? Stay tuned for more on ISPE's meeting. -AMS
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