Contract manufacturers such as Corgenix Inc. (Broomfield, CO) have established strong core competencies that help their clients bring their products to market quickly and with first-class quality.
An exciting aspect of the IVD industry is that a company of any size can develop new products and technologies. Since many smaller IVD companies do not have the infrastructure to take these new products from innovation to finished product, a contract manufacturing partner may be needed to adequately commercialize the product. On the other hand, many large IVD companies do not have the ability or resources to rapidly respond to the need to move a new product or technology to market in a timely manner. In many cases, a contract manufacturing partner is the most expeditious route to market.
There are many advantages to using a contract manufacturing partner when moving from prototype to commercialized product. Since IVDs are produced in a highly regulated industry, many design and development companies may lack the infrastructure, in-house expertise, equipment, and processes to manufacture commercial products. In other cases, the innovator may wish to capitalize on its expertise and stay strictly with discovery. Many start-up IVD companies do not have the capital required to build an infrastructure to support an ISO 13485:2003 certification. Whatever the reason, contract manufacturing can be the fastest route to commercialization.
Making the Decision To Contract Out Manufacturing
As an IVD company seeks a contract manufacturing partner, there are many things to consider. Prior to any contact with potential partners, a group of individuals representing key departments in the outsourcing company must determine the critical characteristics they are looking for in a partner. For example, an IVD company may acknowledge that there will be a great deal of direct interaction needed between it and the contract manufacturer, and thus proximity between the two sites is critical to manage costs. With proximity thus established as a critical issue, there should be pause in pursuing a company halfway around the world despite its great reputation. When clear criteria are established, the company's representatives can be more focused when evaluating potential partners and more direct with inquiries. The involvement of a multidisciplinary group ensures that all aspects of the company's project are considered and that there is a greater sense of ownership in the final choice of a partner.
Sourcing several potential contract manufacturers is important for comparison purposes. Referrals from another partner with direct experience with the prospective contract manufacturer is the best way to find potential partners, but if that is not possible, it is critical to conduct a thorough evaluation. A telephone interview followed by a site visit and discussions with key personnel are crucial.
It is also a good idea to confer regarding costs early in the discussion phase. The last thing the two prospective partners want is to proceed along as if costs will be aligned with each partner's goals, only to determine later that the two have entirely different expectations.
Evaluating a Potential Partner. The outsourcing IVD company can be well served by having a written list of criteria that they have determined will be essential for success. By having these criteria in writing, the company can be consistent in their approach (compare an apple to an apple), be complete in the requirements that they demand of a potential partner, and avoid misinterpretation between the two parties. The following questions should be considered when selecting a contract manufacturing partner:
• Is the contract manufacturer on solid financial footing?
• Is the company cGMP compliant and FDA regulated? When was the last FDA inspection? What were the findings?
• Is the company experienced in CE marking? Will the product be sold in the EU?
• Is the facility ISO 13485:2003 certified?
• If the product is to be sold in Canada, is the company CMDAS-certified?
• Does the contract manufacturer provide all production services required, or will some need to be outsourced?
• Are the details of the company's quality manual and quality system sufficient?
• What types of IVD products are currently manufactured at the site, and how many years' experience does the company have with these technologies?
• What are the current production levels compared to capacity, and what is the future projected capacity?
• Can its capabilities in labeling and packaging meet requirements, and how flexible are these assets to meet future needs?
• What are the documentation practices for design changes, manufacturing variances, production, and quality control? Do these meet regulatory compliance?
• Does the contract manufacturer have a straightforward pricing model that avoids any hidden costs? Are its unit-cost estimates clear and within expectations?
• What is the breadth of its supply chain? When provided with a raw materials list, can the contract manufacturer source, handle, and properly store all items?
• Is its turnaround time commitment within expectations?
• Did the face-to-face meeting with key personnel at contract manufacturer's site provide confidence in their abilities?
• Can they provide references from other contract manufacturing partners?
In order to provide the greatest assistance with the highest probability of a successful partnership, the prospective contract manufacturer must ask a lot of questions as well to fully understand the other company and its products. Similar to the outsourcing company, the contract manufacturer can help itself as well as the potential partner by having a well-researched, written list of questions or an established checklist that would ensure that the company fully understands what the partner is seeking, can incorporate details that were learned on previous partnerships, and will demonstrate the thoroughness that any partner would be looking for. Information that the contract manufacturer will want from the prospective partner includes:
• Was the product developed under design control? Can it be safely and consistently manufactured? Is it already commercialized?
• Is the product for research use only, or is FDA clearance the goal?
• If FDA clearance is the goal, is assistance expected from the contract manufacturing partner in order to obtain clearance?
• Can the OEM provide realistic expectations for time to market?
•Are existing manufacturing documents compatible with the contract manufacturer's quality system?
• Are the product specifications well defined?
• Does the contracting company have well-reasoned forecasts of volume including lot sizes and frequency? Is this a line extension of an existing product or a new concept?
• What role will each play in CE-marking requirements, sourcing an authorized representative, and submitting the technical file?
• Are there special manufacturing conditions that are met or can be met at the current facility? For example, is there a cleanroom environment, humidity control, handling of hazardous materials, lyophilization, or security restrictions?
• What are the warehousing and distribution expectations?
• Will there be any special packaging and labeling requirements? Can those requirements be met by existing equipment? What investments are necessary?
• Are there special shipping requirements; e.g., the need for blue ice or dry ice?
• Who is responsible for product-complaint handling?
• What will be the process for handling customer complaints? Who is first tier, etc.?
As the initial discussions move toward a site visit and audit, it is important to begin defining further those specifications that were covered in general initially. The manufacturing procedure may require unique volume, time, or environmental controls. Solution preparation might need specialized plastic or metal containers, sterile fill, or humidity or temperature controls. General topics will become more and more refined at this point.
It is during the site visit that face-to-face association begins and some of the intangible qualifications of a contract manufacturing company can be evaluated. An intangible is something that cannot be answered on a request for information (RFI), but is critical when an IVD company is trusting its products to the care of another company. Such things as how well the company's representatives communicate, who will be the primary contacts between the two companies, how they deal with issues both at crisis level and at annoyance level, and the integrity of those involved, i.e., will an IVD company get a direct, honest response to the issues at hand? Evaluating a partner for these elusive traits is difficult, but essential, and therefore those individuals from the outsourcing company must keep that evaluation criteria in mind during the visit and look for revealing responses. Any discussions with the contract manufacturer's current partners might also provide insight into this characteristic.
Another critical contact made at the contracting manufacturer's site is a comprehensive audit of the contract manufacturer's quality system. This is an in-depth look by the outsourcing company's quality group that can reveal a great deal about the other company's quality system. This audit will also form the basis for developing a quality agreement between the two companies.
After the selection has been made. Once the two companies have determined that a partnership between the two is a good fit and will provide a great opportunity for mutual success, there still remains a lot of work in the details. The most important is finalizing a comprehensive contract manufacturing agreement with well-defined expectations. This document is an absolute necessity prior to manufacturing the first pilot lot. The agreement allows both partners to focus their energy on the most value-added tasks, establishes well-defined coordination points, and allows both companies to track progress.
The agreement should contain the details that follow.
Raw-materials sourcing and vendors must be spelled out. The company may have raw materials and vendors well-defined, or may need much guidance from the manufacturer. Some raw materials are commercially available and others may need to be custom produced. The company may have well-defined raw-material specifications with primary and secondary vendors identified, but in many cases, these products have come out of a research setting, so the contract manufacturer may be expected to play a large role in raw-material vendor selection. Any preservatives used must comply with state and federal regulations. If a different preservative will be used, preservative-effectiveness studies are required.
Quality-control testing is required on incoming raw materials, in-process materials, and final product, so it is critical to establish testing requirements. Both companies need to have a full understanding of the ranges and tolerances that will be used in the test results, how the data will be shared, who will make the decision to accept results or require additional manipulation, and any retest protocols.
Sometimes specialized equipment is needed to perform quality-control testing, so the parties must determine if the equipment is in place at the contract manufacturer's site, or if any new equipment must be acquired. If new equipment is required, who will be responsible for paying for it? Stability testing and sampling plans will be put into place. Generally a prototype product has not had transportation stress testing performed. Either the company or the contract manufacturer may perform this task, according to any unique shipping requirements.
Packaging, labeling, and shipping require many decisions to be made—on types of packaging materials, label material, generation of the label copy or artwork, label size, moisture transmission, corrosive testing, and more. If lyophilization of raw materials is needed, scale-up studies may be required prior to large-scale production. Bottle size and type and label stock need to be compatible with the contract manufacturer's automated filling, capping, and labeling equipment. It must be determined if the contract manufacturer will be warehousing and shipping to the company or drop-shipping to its customers.
CE marking is required for products shipped to Europe, and most contract manufacturers are prepared to assist with these tasks. For low-risk devices, technical documentation must be in compliance with the European Union In Vitro Diagnostic Directive (IVD Directive). An authorized representative in the EU must be chosen and appointed. A summary technical file must be created and submitted to the authorized representative so that it is available to a requesting European competent authority within two business days of request. The summary technical file will contain a product description, a description of the manufacturing process, IVD Directive classification, a company overview, quality systems certification, authorized representative information, an essential requirements dossier, product-specific risk analysis, instructions for use, a kit box label, a component label set, product specifications, FDA clearance letters, performance characteristics, and a CE Declaration of Conformity. Additional requirements govern higher risk List-A and List-B IVDs.
Customer service options may also be offered by some contract manufacturers. A partner company may want complete control over all aspects of customer service: order processing and invoicing, receiving finished product in lot-quantities, warehousing and distribution to end-user customers, complaint handling, adverse-event reporting and follow-up. Others may need some or all of these services. A discussion early in the process can help screen-in or screen-out contract manufacturers that may or may not offer all services needed.
A contract manufacturing relationship should be a true partnership between the IVD manufacturer and partner company. Each party has a lot to gain from a well-defined agreement. When properly investigated and managed, the relationship should last for many years. A successful contract manufacturing relationship may develop into a long-term partnership in which one company is continually developing new products for the other to manufacture. In other cases, the company requiring contract manufacturing services may just need the manufacturer while developing its own manufacturing facility. Whatever the situation, all parties should establish well-defined expectations and mutual agreement to ensure long-term success.
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