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Building a Green Supply Chain - Unlocking the Pharmaceutical Manufacturing Bottlenecks

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by Owais Ahmad Shah , Senior Research Analyst Active Pharmaceutical
30 June 2015

Pharmaceutical Industry has long been committed to sustainability, however has grappled with challenges of incorporating measures in its supply chain that would support this initiative. Companies have taken steps in the past decade to minimize the impact on environment by working to build an environmentally friendlier product portfolio and have also incorporated these objectives in their strategies. At the same time companies are also looking to adopt new technologies to address this issue over the next five years and feel that these measures are critical for the future success of their business. However, building an environment friendly supply chain seems to be a daunting task in pharma industry as it involves dealing with numerous chemicals which are toxic and hazardous at many times and make a huge impact on the environment.

API manufacturing is one of the major challenges for pharma companies in realizing their sustainability objectives as it involves complex chemical process which often end up generating thousands of tons toxic chemical waste. Industry over the past at different instances has looked at green methodologies like biocatalysis which can help reducing the chemical wastage from production processes and are cost effective at the same time. However, this technology is still at an initial adoption level within the pharma industry but looks promising given the success stories in the past. Due to which a steady trend has been observed in the adoption of this technology in pharmaceutical manufacturing both the major pharma companies and the outsourcing partners. Recently, over the past three to four years there has been an increase of adoption of green technologies majorly by the outsourcing partners and hence, paving a way for pharma companies to leverage this opportunity and incorporate green technologies at different stages of the supply chain.

This paper analyzes the steady trend in the adoption of green technologies (biocatalysis) by the pharma industry evaluates the future potential and opportunities for API manufacturing to be transformed into a greener and environmentally friendlier process.China amended its environmental law in April 2014 and took effect on January 1, 2015. Undoubtedly, China has been growing with double digits since years, however, has been struggling to deal with the environmental cost of its growth and has now put in practices to deal with the issue.

Problem Statement

With climate change gaining significant importance over the past decade, nations across the globe have responded positively and put in measures to check their carbon emission. Industry being the fundamental fragment of this initiative, leaders across different sectors have recognized their responsibility towards climate and assured this priority is reflected well in their growth strategies.

Among the pharmaceutical sector, global majors like Johnson & Johnson, Pfizer, Sanofi, GlaxoSmithKline, Merck, AstraZeneca, Bristol-Myers Squibb and Bayer have adopted different initiatives across the supply chain to reduce their carbon footprint. One of which included the development of an environmentally friendlier product portfolio over the past decade and various other initiatives like setting up cross functional R&D teams to develop greener alternatives to build a green supply chain.

API manufacturing is one of the key element of the pharmaceutical supply chain and indeed one of the major bottleneck in adopting a green supply chain due to its cumbersome, waste intensive (toxic) and highly expensive processes having an E-factor of 25–100. It is estimated that 25% of the total cost of developing an NCE is related to APIs with manufacturing cost accounting for about 35 – 40% of this expense.

However, pharma companies have looked at green processes aided by biotechnology time to time and sought aid to tackle these difficult challenges. Biocatalysis, which involves use of bio engineered enzymes that can be used in industrial production to replace organic solvents and toxic metal catalysts, have been proved effective in many cases and Industry is also witnessing a steady growth of the adoption of this technology at different stages across the supply chain.

Pharma’s inclination to biocatalysis – Status quo of adoption in pharmaceutical industry

Biocatalysis has been used in API manufacturing in the past at various instances as a means to simplify manufacturing process, reduce waste production and achieve cost efficiencies, thus increasing profitability.

In 2007, pregabalin (active ingredient) for the Pfizer’s drug Lyrica was synthesized using a biocatalytic process. The new process is estimated to reduce Pfizer’s organic waste for pregabalin by 20,000 MT between a period of thirteen years (2007 – 2020). The process also reduced the use of energy and solvents by 83% and 90% respectively, thus increasing productivity. Pfizer has also employed biocatalytic process to its other major APIs like atorvastatin, artemisinin, oseltamivir and pelitrexol.

Merck, in the same year, also successfully employed biocatalytic process to manufacture sitagliptin (active ingredient) for Januvia in collaboration with Codexis Inc., which resulted in the productivity increase of 56%, yield increase of 10- 13% and waste reduction of 19%. It is estimated that Merck would eliminate 150,000 MT of waste, comprising about 50,000 MT of aqueous waste over the lifetime of Januvia.

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