The Greening of Pharma

April 14, 2008
Experts give some Big Pharma companies high marks for their environmental initiatives. Benchmarking efforts and new tools promise to make it easier for all drug companies, regardless of size, to improve performance and reduce costs.

The famous complaint that “it’s not easy being green” just won’t cut it in the real world anymore. Drug manufacturers that have made concerted efforts to boost their energy efficiency or convert their manufacturing processes to greener chemistries have not only realized intangible image improvement, but very tangible bottom line benefits.

This holds for both Allergan, Inc. (Irvine, Calif.) and Merck (Whitehouse Station, N.J.), both of which were singled out this year for their energy efficiency programs by the Energy Star program, administered by the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Energy (DOE) (sidebar).

Pharmaceutical Manufacturers
Participating in Energy Star
AstraZeneca Int’l.
Bayer *
Bristol-Myers Squibb*
Glaxo Smith Kline *
Johnson & Johnson*
Eli Lilly & Co.*
Merck & Co., Inc.**
Pfizer Inc.*
Tyco Healthcare*

* denotes Energy Star Partners
** denotes Energy Star Partner of the Year awardees

Critical to any drug company’s success is strongly articulated, top-down management support for environmental initiatives. Merck, Genentech and Procter and Gamble were among 20 major corporations that collaborated with Energy Star personnel and scenario consultants from Global Business Network to develop the position paper “Energy Strategy for the Road Ahead” last year. In this document, authors from industry and EPA proposed various hypothetical situations that might change the global energy scene through 2020 and how they would affect businesses.

The group concluded that the following [1] would be key to survival:

  • Executive commitment to continually improve energy efficiency across the entire corporation, including clear processes and tracking systems to identify opportunities
  • An empowered corporate energy director and energy team supported by sufficient human and financial resources
  • A corporate energy policy that is accounted for at the top levels of the corporation
  • Aggressive, numeric energy goals that stretch performance targets to draw out creative innovations for meeting them
  • Measurement and tracking of energy performance for all energy use, corporationwide, including benchmarking facility performance nationally and globally with similar companies, and a review system with accountability at all levels
  • Communication of the value of energy savings, importance of improving use of energy and executive commitment by consistently recognizing accomplishments.

In developing the “Energy Strategy for the Future” document, the participants were “reading the tea leaves,” says EPA’s Walt Tunnessen, Energy Star national program manager. “Indications are the world will look different in the not-too-distant future… The high gasoline prices we see now are just a bellwether. Corporate executives need to think about what they can do now to mitigate future risks.”

These considerations are especially critical for pharmaceutical companies, Tunnessen points out, because many of them are located in areas of the U.S. where energy costs are higher to begin with, such as New Jersey, Southern California, and the Chicago area.

“Historically, the pharmaceutical industry hasn’t seen energy as a controllable cost, but that’s turning around,” Tunnessen observes. Although the industry is far from being the most energy-intensive, spending about 3% of its annual manufacturing costs on energy, that figure still adds up. “It’s not insignificant by any means,” he says.

Reducing energy consumption requires having a program in place, staying on message and motivating people throughout the enterprise. Merck’s CEO showed his support for energy efficiency two years ago, when he videotaped a “call to action” to all employees, setting a tone from the top level of the organization.

A Well-Stocked Toolbox

Any drug manufacturing professional can easily find resources on improving energy efficiency (for more information, visit’s new online Green Resources Library).

Among the tools that Energy Star provides are:

  • A Website that facilitates sharing of energyefficiency best practices among companies;
  • A reference manual, “Energy Efficiency Improvement and Cost Saving Opportunities for the Pharmaceutical Industry,” sponsored by EPA and developed by researchers at Lawrence Berkeley National Laboratory (LBNL) in September 2005 (also in our online Green Resources Library).

Joining them shortly will be the Pharmaceutical Manufacturing Energy Performance Indicator (EPI), a benchmarking tool, now in the final stages of review and approval. Created by economist Gale Boyd, Ph.D. at Duke University, EPI will be based on data submitted by several larger pharma companies on about 35 of their facilities. Its goal is to enable corporate-and industry-wide benchmarking and to rate the energy efficiency of a single U.S. pharmaceutical manufacturing facility. The Indicator will use basic inputs to provide a percentile ranking of an individual plant’s energy efficiency by comparing it to the industry’s average and “efficient” (defined as the 75th percentile) plants.

On behalf of and for use by the Energy Star Program, Boyd has developed indices like this for automotive assembly and cement manufacturing, as well as other sectors. “Energy management is about measuring. You don’t manage what you don’t measure,” he points out.

This is the third year that the Energy Star Program has been working with pharmaceutical manufacturers to gather and analyze data. Energy Star’s Tunnessen says group members are performing a final “reality check” on the EPI in their facilities, and he expects to be able to release the tool this summer.

“Then, after a year or two, we’ll probably revise it again,” Tunnessen remarks. Boyd explains that up to now, the companies that have submitted data to be analyzed for the purpose of developing the EPI are larger, branded pharma manufacturers and the data is primarily from smallmolecule drugmaking operations. “As more companies [with different types of facilities] come on board, and the people using the index raise issues about its applicability to their particular situations, we’ll need to make revisions,” which is fine with him, he says, because the more specific and granular the data, the more the tool can be adjusted to maximize its usefulness. “The most interesting problems are never the easy ones,” Boyd muses.

He says the Energy Star Program has, as yet, had little success in attracting “more strictly manufacturing-focused” companies — contract manufacturers, that is — into the mix. Neither are many biologics manufacturing operations represented, nor any foreign facilities (however, plants that are located in Puerto Rico but owned by U.S.-based companies are included). Whereas Big Pharma companies can be guarded about revealing manufacturing-related information in some contexts, Boyd notes that energy efficiency is a significant exception. “Big Pharma energy managers don’t have ‘club secrets,’” he says. “In fact, before Energy Star came along, they didn’t even have a club.”

Even with the somewhat limited data that has been available to Boyd and his Energy Star colleagues, there have been challenges in figuring out how to organize the information coming in from manufacturers. Each facility may house a number of different types and combinations of operations, he says, and there may be considerable variability between amount of product produced and the finished product cost from one product to another.

Drug makers were asked to provide three years worth of data, and most did, Boyd says. Researchers then categorized each location (which might include multiple buildings, each of which might have a different function or combination of functions). The entire data set was then pooled across facilities and across the years for which data were submitted. “We looked at factors such as what activity is going on in a particular location, how much the space is being utilized (hours per sq. ft.), each facility’s location and the climate variations among locations,” Boyd explains.

Pharma Plants More Variable

In particular, he says, his team struggled with the question, “What is the rate of production?” He explains, “That’s not difficult to answer in an automotive assembly plant or a cement plant, where a measure like energy use per unit of product produced will be pretty stable. But in pharmaceuticals, that figure can vary wildly from one product to another. So we settled on facility size, utilization of floor space and hours of operation as the basis for comparison.”

One thing he would urge pharmaceutical companies with multi-building campuses to do, in order to generate more granular – and thus more enlightening and useful – data, is to “submeter” their facilities. That is, on a multi-building campus, each building should have its own separate energy meter. The cost of doing that is relatively minimal, and the initiative will pay for itself within one year, because it allows an energy manager to immediately find where energy is being wasted, says Boyd. He adds that the EPA/DOE’s joint Labs21 Program ( is also looking at how laboratory facilities measure their energy usage and trying to understand the implications for individual labs.

“In the pharmaceutical industry, some companies are just now getting submeters installed on their various buildings,” Boyd observes. “In other industries, you have companies like Toyota that can pull up a program that will show you, in real time, how much energy each air compressor in a given plant is using.”

Boyd notes that when he and Energy Star personnel have focus meetings with the pharmaceutical companies participating in the development of the pharma EPI, they discuss issues such as submetering. Thus, as the drug manufacturers help the researchers hone the benchmarking tool, the researchers, in turn, are able to share best practices from other industries to help the manufacturers increase their energy efficiency.

What About the Production Process?

Curbing energy usage is one way — and a cost-effective way at that — to “go green,” but it is neither the only way to reduce one’s carbon footprint nor the only way to cut costs. “Green chemistry” is another approach, and it is not competitive with, but is complementary to, energy-efficiency initiatives. In energy management, one looks at all the elements that are external to the drug product and, for the most part, to the process by which it is manufactured. Green chemistry raises the question, “How can we achieve the same end-product using a different set of inputs and reactions such that we eliminate waste from the process?”

Answering that question, according to Berkeley “Buzz” Cue, green chemistry advocate, consultant and former vice president of Pharmaceutical Sciences at Pfizer Global R&D, requires first determining how “green” (or not) your existing processes are. Or, in the words of economist Gale Boyd, “You don’t [or can’t] manage what you don’t measure.”

Merck, Allergan Cited for Energy Efficiency Programs
This year, Merck & Co.’s energy efficiency programs won recognition from Energy Star for the third year in a row, and their first citation for Sustained Excellence.
Merck’s accomplishments included reducing consumption by nearly 50% over the past five years, and leading efforts to share best practices across industries. Last year, the company invested in a series of plant
recommissioning projects in which facility support systems were analyzed for performance relative to their original designs.
Additionally, submetering was installed to better enable the corporation to assess energy use. These investments are expected to sustain savings in future years. Merck senior management continued to make employees part of the solution by communicating their aggressive energy goals to everyone.
To encourage employees’ efforts, a reward system was implemented to provide prizes, such as payment of a home energy bill, for demonstrating excellence in personal energy use in the workplace.
Merck has also set a corporate-wide energy savings goal of reducing energy intensity 25% by 2008 relative to 2004, and has pledged to reduce total global greenhouse gas emissions by 12% from 2004 to 2012 through EPA’s Climate Leaders program.
Allergan, Inc. (Irvine, Calif.), meanwhile, received its first Energy Star Partner of the Year recognition for its energy management team, an aggressive submetering strategy to aid benchmarking, and a 4% improvement
in energy intensity across its facilities last year, which saved over 7.8 million kWh and $839,000.
The company engages suppliers and customers to help meet new targets, and has set a goal to reduce energy consumption and greenhouse gas emissions 5% by 2010, and 50% by 2020.

What Cue doesn’t question is the ethical, ecological and economic value of green chemistry. While he views questions regarding the relative energy efficiency of a process as “hard to get a handle on,” he says, “As I see it, the huge, immediate opportunities for reducing the environmental impact of pharmaceutical manufacturing are in green chemistry, at least for API manufacturing.”

Cue was the originator and champion of the green chemistry program at Pfizer from 2000 to 2004. Today, although retired from Pfizer, he is far from idle. Cue is actively involved in the American Chemical Society’s (ACS) Green Chemistry Institute (GCI) and the Institute’s Pharmaceutical Roundtable. The Roundtable’s raison d’être is to promote the use of green chemistry in pharmaceutical manufacturing, to identify those processes for which greener alternatives are most urgently needed, and to fund research into green chemistry solutions.

“Our member companies include AstraZeneca, Lilly, GSK, J&J, Merck, Pfizer, Schering-Plough and Wyeth, and Boehringer-Ingelheim just joined,” Cue remarks. “Overall, our aim is to identify the common issues all members face and how we can work together precompetitively and noncompetitively to solve them.”

More specifically, Cue says, the two big issues the Roundtable is tackling are 1) the development of metrics that would help pharma companies answer the question, “How do we measure how green our processes are?” and 2) identifying “the 10 worst reactions that need green replacements.”

Development of a more sophisticated metric is under way, but in the meantime, Cue says, one can begin to get a handle on the relative greenness of a process by measuring the number of kilograms of waste generated and dividing it by the kilograms of API produced. “By and large, the industry has gotten much better at reducing waste — in many processes, most of the active and the reagents are recovered and recycled,” Cue points out. “However, what isn’t recovered or recycled is packaged and sent away to be disposed of, which usually means burned, and that’s not a desirable outcome. The first principle of green chemistry is that it’s better not to produce waste in the first place.”

As for the “10 worst reactions” issue, Cue says that each company brought its own “10 worst” list to the Roundtable, and there was a fair amount of overlap among the lists. Thus, it wasn’t hard for the members to reach a consensus on their first 10 targets. Cue explains, “Some of the reactions they wanted to change are those they run now, and some are aspirational — that is, reactions they’d like to run if they could find a greener way to do them.”

Cue notes that companies pay a fee in order to joining the Pharmaceutical Roundtable, and part of those fees are used to make research grants. Thus, when the participants had agreed upon their “10 worst reactions” list, “we published a Request for Proposal (RFP) in Chemical Engineering News, and we received 35 applications for one grant,” says Cue. He adds that Roundtable members were so impressed by the quality of the proposals received that they ended up beating the bushes for more money and funding two grants.

“We’ll fund one or two grants each year, and when we’ve come up with green chemistry solutions for the first 10 reactions, we’ll try to come up with a new ‘10 worst’ list,” Cue says.

Meanwhile, of course, many individual pharmaceutical companies (including Roundtable members) are doing their own research into green chemistry. Pfizer has maintained its program and Merck has made considerable headway over the last several years.

Indeed, says R.P. (Skip) Volante, Merck’s vice president and global head of Process Research, the very existence and mission of the Process Research department reflects Merck’s goal of maximizing efficiency throughout the corporation and its interest in driving innovation to solve problems at an early stage. Volante indicates that green chemistry, with its guiding principles of preventing waste, maximizing atom economy, and employing catalysis wherever possible dovetail perfectly with the company’s philosophy of how to develop and manufacture drug products.

In an FDA-regulated industry where products and processes must be validated prior to receiving marketing approval, “it is much more difficult to change the process post-launch,” Volante points out. Thus, he says, by the time of product launch, “it is our goal to have already applied green chemistry practices wherever possible to minimize waste and environmental impact, and to have evaluated whether we’re doing it as efficiently as possible. We’re leveraging cost efficiency and atom economy to avoid building waste into the process. That way, we can reap the benefits of that process from day one of the launch.” In addition to its big picture, keep-the-end-inmind approach to process development, Merck has demonstrated a commitment to greener processes by investing heavily in catalysis, which is “extremely rare in the pharmaceutical industry,” says Volante, “although some companies are starting to adopt our model. We believe that if we can do things catalytically, we can achieve even higher levels of efficiency.”

Volante notes that in the last five to 10 years, many pharma companies have gone away from an internal catalysis development focus, having determined that it was not their core business. “Solvias, which originated out of Novartis, is one example,” he says. “We actually partnered with Solvias in developing the process for producing sitagliptin, the active ingredient in Januvia, our drug for type 2 diabetes.”

In fact, that process earned Merck the Greener Synthetic Pathways Award in the 2006 Presidential Green Chemistry Challenge (PGCC) Awards Program for its synthesis of Januvia, which reduced waste per pound of sitagliptin manufactured by 50%, or 220 pounds of waste per pound of product. Over the product’s lifetime, that means 330 million pounds of waste, including nearly 110 million pounds of aqueous waste, will be eliminated.

As to the savings involved, readers can do the math. Merck claims that overall, green chemistry efforts have allowed it to reduce waste by over 80% and to completely eliminate aqueous waste streams. But if the ROI associated with such efforts isn’t enough, Buzz Cue offers additional encouragement. “Some people in pharma may hesitate to explore green chemistry alternatives because they think it will cost a lot of money, but we got green chemistry going at Pfizer in a year when there was a prohibition on new initiatives,” Cue points out. “By reducing waste and the costs associated with disposing of or recycling that waste, green chemistry ends up saving you money.”


1. Energy Strategy for the Road Ahead: Scenario Thinking for Business Executives and Corporate Boards, Global Business Network, San Francisco, Calif., 2007

About the Author

Heidi Parsons | Managing Editor