Managing Integrated Development in the Pharmaceutical Industry:

A Cross-Functional Approach to Development of More

Efficient Manufacturing Processes

DISSERTATION
of the University of St. Gallen,
School of Management,
Economics, Law, Social Sciences
and International Affairs
to obtain the title of
Doctor of Philosophy in Management

submitted by

Reto Marc Ziegler

from
Basel

Approved on the application of

Prof. Dr. Thomas Friedli

and
Prof. Dr. Urs Fueglistaller

Dissertation no. 4254

Digitaldruckhaus GmbH, Konstanz 2014

The University of St. Gallen, School of Management, Economics, Law, Social Sciences
and International Affairs hereby consents to the printing of the present dissertation,
without hereby expressing any opinion on the views herein expressed.

St. Gallen, October 21, 2013

The President:

Prof. Dr. Thomas Bieger

For Cristina.

Acknowledgement

This dissertation is the final result of over four years at the Institute of Technology
Management of the University of St.Gallen. During that time I had the chance to be
involved in various interesting research and consulting projects and I had the opportunity
to function as teaching assistant of two lectures. All this was an extraordinary experience.
It was all enabled by my supervisor Prof. Dr. Thomas Friedli, who provided guidance
and support when needed but allowed to work independently whenever wanted. I very
much appreciate his mentorship and all his professional and scientific advices. Also, I
thank Prof. Dr. Urs Fueglistaller for his interest in my research and for agreeing to act as
co-supervisor.
Furthermore, I enjoyed the pleasant environment at the Institute of Technology
Management. I had numerous creative and productive discussions with the whole team.
Special thanks go to Andreas Mundt, with whom I worked on different projects and
seminars, and Matthias Gtzfried.
I thank my family for the outstanding support and encouragement during my studies and
especially my time in St.Gallen. Special thanks go to my father Dr. Ren Ziegler for his
critical reading of this dissertation.
Finally, I thank my love, Cristina, for all her patience, endurance, support, and constant
motivation. Without her, this dissertation wouldnt have come to an end.

Summary

Current figures from the pharmaceutical industry show a clear trend towards ever rising
costs and duration of new product development. In parallel, fewer product candidates get
through clinical development. This can be summarized simply as an R&D productivity
crisis. The result is increasing time and cost pressure and results in fewer resources being
allocated for the development of manufacturing processes. As soon as efficacy and safety
studies are accepted by regulatory agencies, commercial production starts with whatever
production process had been used during development. Delays right before launch have a
direct effect on the remaining time the product is protected by patents and thus on high
margin sales.
As a result it can be observed that many newly introduced products are produced by
highly inefficient manufacturing processes. Poor processes lead to excessive
manufacturing costs which could easily be avoided by changes in the development
process.
In the past it was shown in other industries (e.g. electronics and machinery) that the
problem mentioned above was solved to a great extent by using an approach called
integrated development. Basically this means involving production early during
development in order to ensure that processes can be transferred to commercial
production very smoothly and ideally without any adaptations.
In this dissertation it is shown how to adapt an integrated development approach to the
pharmaceutical industry. The result is a process model surrounded by a framework that
extends the scientific knowledge about integrated development and is at the same time
applicable in practice.

Zusammenfassung

Aktuelle Zahlen aus der pharmazeutischen Industrie zeigen, dass die Entwicklung von
neuen Produkten immer lnger dauert und immer mehr kostet. Zudem schaffen immer
weniger Produkte die Hrde der klinischen Entwicklung. Man spricht schon fast von
einem Produktivittsproblem der Forschung und Entwicklung. Dieser Zeit- und
Kostendruck fhrt dazu, dass immer weniger Ressourcen fr die Entwicklung der
Produktionsprozesse

aufgewendet

werden.

Produkte

werden,

sobald

die

Regulierungsbehrden die Vertrglichkeit und die Wirksamkeit anerkennen und sie

zulassen, direkt produziert. Jede Verzgerung vor dem Produktionsstart (Launch)
bedeutet eine krzere Zeit, in der das Produkt durch den Patentschutz geschtzt ist.
Als Folge kann beobachtet werden, dass viele neu eingefhrte Produkte usserst
ineffizient produziert werden. Die Herstellkosten sind deutlich berhht. Dadurch
entstehen unntige Kosten, die mit einigen Anpassungen im Entwicklungsprozess
vermieden werden knnen.
In verschiedenen Industrien (bspw. Elektronik- und Maschinen-Industrie) wurde in der
Vergangenheit gezeigt, dass mittels eines integrierten Entwicklungsprozesses das
geschilderte Problem verringert werden kann. Dadurch wird bereits whrend der
Entwicklung

durch

den

Einbezug

der

Produktion

sichergestellt,

dass

die

Produktionsprozesse ohne Anpassungen im kommerziellen Massstab umsetzbar sind.

In der vorliegenden Dissertation wird beschrieben, wie das Konzept der integrierten
Entwicklung auf die pharmazeutische Industrie angewendet werden soll. Das Ergebnis ist
ein Modell, das die Wissenschaft erweitert und gleichzeitig auch in der Praxis anwendbar
ist.

Table of Contents

Table of Contents .............................................................................................................. XI

List of Figures ................................................................................................................. XV
List of Tables.................................................................................................................. XIX
List of Abbreviations ..................................................................................................... XXI
1 Introduction.................................................................................................................... 1
1.1 Motivation................................................................................................................... 1
1.2 Practical Relevance ..................................................................................................... 2
1.3 Terms and Definitions ................................................................................................ 6
1.3.1 The Pharmaceutical Industry ................................................................................... 6
1.3.2 The Launch Site ....................................................................................................... 7
1.3.3 The Pharmaceutical Development Process.............................................................. 8
Excursus: Quality by Design A Recent FDA Initiative ................................................. 10
1.4 Research Goal and Question..................................................................................... 14
1.5 Research Design ....................................................................................................... 15
1.5.1 Research Concept .................................................................................................. 15
1.5.2 Research theory ..................................................................................................... 17
1.5.3 Structure ................................................................................................................. 19
2 Theoretical Foundation ................................................................................................ 23
2.1 From New Product Development ......................................................................... 23
2.2 To Integrated Product Development..................................................................... 25
2.3 Concurrent Engineering ............................................................................................ 27
2.4 Cross-Functional Teams ........................................................................................... 28
2.5 Success Factors in Product Development ................................................................. 30
2.6 Insights and Theoretical Deficits .............................................................................. 32

XII

Table of Contents

3 Development of a Reference Framework .................................................................... 35

3.1 The Framework in General ....................................................................................... 35
3.2 Components in Detail ............................................................................................... 36
3.2.1 Concurrent Engineering ......................................................................................... 36
3.2.2 Success Factors ...................................................................................................... 38
3.2.3 Organization .......................................................................................................... 43
3.2.4 Effects on Performance.......................................................................................... 43
4 Integrated Development in Practice ............................................................................ 45
4.1 Industry Survey: An Empirical Investigation ........................................................... 45
4.1.1 Industry Survey Questionnaire ........................................................................... 45
4.1.2 Industry Survey Data Sample ............................................................................. 47
4.1.3 Measuring Performance ......................................................................................... 50
4.1.4 Measuring Integration ............................................................................................ 54
4.2 Special Aspects ......................................................................................................... 56
4.2.1 General Findings about the Pharmaceutical Industry ............................................ 56
4.2.2 Integrated Development in the Pharmaceutical Industry ...................................... 59
4.2.3 Organizational Set-Up ........................................................................................... 61
4.2.4 Cross-Functional Collaboration ............................................................................. 65
4.2.5 Success Factors ...................................................................................................... 66
Excursus: Quality by Design in Industry .......................................................................... 70
4.3 Insights from Current Industry Practices .................................................................. 73
5 Successful Approaches to Integrated Development .................................................... 75
5.1 Selection of the Case Study Companies ................................................................... 75
5.2 Conception of the Case Studies ................................................................................ 76
5.3 Case Pharmaco1........................................................................................................ 77
5.3.1 The Company......................................................................................................... 77
5.3.2 The Development Process ..................................................................................... 78
5.3.3 The Organizational Set-Up .................................................................................... 82
5.3.4 Cross-Functional Collaboration ............................................................................. 85
5.3.5 On-going or Past Improvement Initiatives in Late Stage Development................ 88

Table of Contents

XIII

5.3.6 Potential for Further Improvement ........................................................................ 90

Excursus: Quality by Design in Practice........................................................................... 91
5.4 Case Pharmaco2........................................................................................................ 94
5.4.1 The Company......................................................................................................... 94
5.4.2 The Development Process ..................................................................................... 96
5.4.3 The Organizational Set-Up .................................................................................. 100
5.4.4 Cross-Functional Collaboration ........................................................................... 101
5.4.5 The Potential for Further Improvement ............................................................... 104
5.5 Insights from the Case Study Research .................................................................. 105
5.5.1 Cross-Case Comparison....................................................................................... 105
5.5.2 Comparison with the Literature ........................................................................... 106
5.5.3 General Insights ................................................................................................... 107
6 Design Characteristics of an Approach to Integrated Development ......................... 109
6.1 Integrated Development as Facilitator .................................................................... 109
6.2 Design and Configuration of Integrated Development .......................................... 111
6.2.1 Organizational Set-Up ......................................................................................... 112
6.2.2 Managing Cross-Functional Collaboration ......................................................... 113
6.2.3 Success Factors .................................................................................................... 117
6.2.4 Knowledge Management ..................................................................................... 118
6.3 Conclusion .............................................................................................................. 119
7 Summary and Outlook ............................................................................................... 121
7.1 Theoretical Implications ......................................................................................... 121
7.2 Managerial Implications ......................................................................................... 123
7.3 Known Limitations ................................................................................................. 125
7.4 Further Research ..................................................................................................... 126
References ....................................................................................................................... 129
Appendix: Survey Questionnaire .................................................................................... 137

List of Figures

Figure 1: Global R&D expenses compared to NMEs (Strickland, 2012). ......................... 2

Figure 2: Time to develop a new drug (CMR International, 2008). ................................... 3
Figure 3: Cost to develop a new drug (Basu, 2010a; PhRMA, 2010). ............................... 3
Figure 4: Development cost per NME (Strickland, 2012). ................................................. 3
Figure 5: Time of patent protection after product launch (CMR International, 2008). ...... 3
Figure 6: Effect of collaboration between development and production on manufacturing
process efficiency. ....................................................................................................... 5
Figure 7: The pharmaceutical development process. .......................................................... 8
Figure 8: Process model of Quality by Design (Yu, 2008)............................................... 12
Figure 9: Research concept. .............................................................................................. 16
Figure 10: Structure of the dissertation. ............................................................................ 20
Figure 11: The NPD-process according to Yeh et al. (Yeh et al., 2008, p.138) ............... 24
Figure 12: Reference framework for integrated development. ......................................... 35
Figure 13: Concept of optimal collaboration along the development process. ................ 38
Figure 14: Categorized success factors from literature, showing the interrelationship and
the effect on performance. ........................................................................................ 39
Figure 15: Adapted reference framework used for the industry survey. .......................... 45
Figure 16: Overview of participants departments (n=37) ............................................... 49
Figure 17: Overview of participants geographical locations (n=37) ............................... 49
Figure 18: Overview of participants company size (n=35) ............................................. 49
Figure 19: Overview of participants company operating fields (n=35) .......................... 49
Figure 20: Experience of participants in years (n=35)...................................................... 50
Figure 21: The general pharmaceutical Drug Product development process ................... 51

XVI

List of Figures

Figure 22: Linear regression of performance and integration (n=20) .............................. 56

Figure 23: Average distribution of employees (n=24) ...................................................... 57
Figure 24: Average R&D expenditures in 209, 2010, and 2011 (n=15 for 2009, n=18 for
2010, n=14 for 2011) ................................................................................................ 57
Figure 25: Average R&D expenditures in 2009, 2010, and 2011 comparison of
innovators (branded drugs & biotech) vs. generics/OTC (n=10 for innovators in
2009, n=13 for innovators in 2010, n=9 for innovators in 2011, n=3 for
generics/OTC in 2009, n=4 for generics/OTC in 2010, n=2 for generics/OTC in
2011) ......................................................................................................................... 57
Figure 26: Average development costs (a) and times (b) (n=29 for (a), n=27 for (b)) .... 58
Figure 27: Average development costs (a) and times (b) of innovators (branded drugs &
biotech) (n=24 for (a), n=22 for (b)) ......................................................................... 58
Figure 28: Duration of single process steps and indication of occurrence of selected
milestones (n=13 for process step duration, n=21 for occurences) .......................... 59
Figure 29: Rating of the effect of integrated development on the performance of different
development stages (n=33) ....................................................................................... 60
Figure 30:Degree of integration of participants development (n=33) ............................. 60
Figure 31: Degree of working in cross-functional teams (n=30)...................................... 61
Figure 32: Overview of ways of working in development teams (n=34) ......................... 61
Figure 33: Distribution of organizational responsibility for process development (n=32)
................................................................................................................................... 62
Figure 34: Distribution of organizational affiliation of the transfer group (n=34) ........... 62
Figure 35: Existence of launch sites in participants company (n=33)............................. 63
Figure 36: Average and maximum number of launch sites (n=12) .................................. 63
Figure 37: Degree of existence of designated launch teams (n=33) ................................. 63
Figure 38: Extent of direct reporting to routine/commercial Production by launch teams
(n=33) ........................................................................................................................ 64
Figure 39: Smoothness of transfer at interfaces during the development process (n=21) 64

List of Figures

XVII

Figure 40: Model of cross-functional collaboration (involvement and responsibility)

during late stage technical development ................................................................... 65
Figure 41: Positive perception of contextual success factors (n=30 for all participants,
n=5 for high performers) ........................................................................................... 68
Figure 42: Positive perception of enabling success factors (n=30 for all participants, n=5
for high performers) .................................................................................................. 68
Figure 43: Positive perception of team behavior success factors (n=30 for all participants,
n=5 for high performers) ........................................................................................... 68
Figure 44: Positive perception of technical success factors (n=30 for all participants, n=5
for high performers) .................................................................................................. 69
Figure 45: Knowledge management solution in different development stages (n=30 for
all participants, n=5 for high performers) ................................................................. 70
Figure 46: Application of minimum QbD elements during selected development stages
(n=30 for all participants, n=5 for high performers) ................................................. 71
Figure 47: Application of DoE during selected development stages (n=30 for all
participants, n=5 for high performers) ...................................................................... 72
Figure 48: Application of PAT during selected development stages (n=30 for all
participants, n=5 for high performers) ...................................................................... 72
Figure 49: Reasons for practicing minimum QbD, DoE, and PAT. ................................. 73
Figure 50: Development process of Pharmaco1. .............................................................. 81
Figure 51: Development process steps at Pharmaco1 (*Process Performance
Qualification). ........................................................................................................... 86
Figure 52: Results of the internal survey: cross-functional collaboration at Pharmaco1. 86
Figure 53: Internal perception of on-going and recent improvement initiatives at
Pharmaco2. ................................................................................................................ 90
Figure 54: Impact of implementing enhanced QbD elements. ......................................... 93
Figure 55: Impact of implementing PAT. ......................................................................... 94
Figure 56: Development process of Pharmaco2. .............................................................. 99

XVIII

List of Figures

Figure 57: Development process steps at Pharmaco2..................................................... 102

Figure 58: Results of the internal survey: cross-functional collaboration at Pharmaco2.
................................................................................................................................. 103
Figure 59 : Integrated development. ............................................................................... 110
Figure 60: Transformation from a reference framework to a descriptive model............ 111
Figure 61: Proposal for optimal cross-functional collaboration in development projects.
................................................................................................................................. 116

List of Tables

Table 1: Clinical phases. ..................................................................................................... 9

Table 2: Literature overview of success factors for cross-functional teams..................... 31
Table 3: Overview of investigated companies and industries in literature. ...................... 33
Table 4: Context success factors. ...................................................................................... 40
Table 5: Enabling success factors. .................................................................................... 41
Table 6: Team behavior success factors. .......................................................................... 42
Table 7: Participants with the corresponding values of performance (P) (n=37) ............. 53
Table 8: High performing participants with the corresponding value of integration (n=5)
................................................................................................................................... 55
Table 9: Correlation matrix for performance and integration (n=20) ............................... 55
Table 10: Positive perception of success factors of all and of high performing participants
(n=30 for all participants, n=5 for high performers) ................................................. 67

List of Abbreviations

ADME

Absorption, distribution, metabolism, and excretion

API

Active pharmaceutical ingredient

B2B

Business to Business

B2C

Business to Customer

CE

Concurrent engineering

CF

Cross-functional

CFT

Cross-functional teams

CMA

Critical material attribute

CMC

Chemistry, manufacturing, and control

CMO

Contract manufacturing organization

CPP

Critical process parameter

CQA

Critical quality attribute

CRO

Contract research organization

DFSS

Design for Six Sigma

DOE

Design of experiment

EMA

European Medicines Agency

e.g.

exempli gratia (for example)

et al.

et alii

FDA

(U.S.) Food and Drug Administration

FMEA

Failure model and effect analysis

Gate

Hrsg.

Herausgeber

XXII

List of Abbreviations

HSG

Hochschule St.Gallen (University of St.Gallen)

i.e.

id est (that is)

IP

Intellectual property

IPC

In-process-control

IPD

Integrated product development

ITEM

Institute of Technology Management,

University of St.Gallen

MS

Milestone

NDA

New drug application

NME

New molecular entity

NPD

New product development

OEE

Overall equipment effectiveness

OPEX

Operational excellence

OTC

Over-the-counter

PAC

Post-approval change

PAT

Process analytical technology

Pharmaco

Pharmaceutical company

POC

Proof of concept

PPQ

Process performance qualification

QA

Quality assurance

QbD

Quality by Design

QC

Quality control

QFD

Quality function deployment

R&D

Research & Development

RACI

Responsible, accountable, consulting, informed

RBV

Resource based view

List of Abbreviations

XXIII

SOP

Standard operating procedure

TPP

Target product profile

TPQP

Target product quality profile

1 Introduction

This chapter builds the practical base for the research reported in the present dissertation.
Furthermore, it introduces and defines special terms and describes the research
proceeding.
First, the motivation and the practical relevance are described. This is followed by our
definition of the pharmaceutical industry and by the explanation of other terms. In the
fourth sub-chapter the research goal and questions are introduced. Finally, the research
design is laid out, explaining the general research proceeding and the theory this research
bases on as well as the structure of this dissertation.

1.1 Motivation
There are many scientific publications to the subject of New Product Development and
its advancement, Integrated Product Development (Kamrani and Vijayan, 2006;
Koufteros et al., 2005; Gerwin and Barrowman, 2002; Krger et al., 2010; Boyle et al.,
2006; Naveh, 2005; Yeh et al., 2008). Supporting tools and methods are described and
their impacts are shown by measurements (Yeh et al., 2008). A great portion of the
existing literature deals with the B2B domain, which is driven by different motives than
the B2C domain (Gerwin and Barrowman, 2002). The remaining literature about
integrated product development in the B2C domain is mostly limited to the mechanical
and electronic industry (Tessarolo, 2007). In other words: there is almost no literature to
this subject focusing on the pharmaceutical or related industries. The main reason is the
substantially more complex development process1. This rather large and especially
relevant industry should no longer be underrepresented in literature.
Furthermore, most existing literature to this subject addresses the measurement of how
various methods and tools impact the development performance (Yeh et al., 2008). The
optimal practical implementation is rather not discussed. Only a very limited amount of

The development process itself is not very different from other industries. However, the main difference and
increased effort is mostly due to high regulatory requirements.

Introduction

examples for the efficient elaboration of the interface between development and
production can be found in the international research community (Vandevelde and
Dierdonck, 2003). Literature is lacking a design model contributing to a higher
understanding of this interface.
The role of launch sites (see chapter 1.3.2) during development is also not sufficiently
described in the literature. So far, there is no model for the collaboration between launch
sites and development, which are in many cases spatially separated.
The FDA initiative Quality by Design (QbD) addresses a contemporary and relevant
concept that is rather new to the pharmaceutical industry (FDA, 2007). Because of its
novelty, there are rather few scientific publications about it. However, a theoretical
description helps to thoroughly understand the initiative and to apply it both effectively
and efficiently.

1.2 Practical Relevance

A neutral observation of the pharmaceutical industry reveals an alarming picture (Figure
1): R&D expenses increase annually. However, at the same time the number of new
products passing registration stagnates. The extreme increase of costs for a new product
is an obvious indication that the pharmaceutical industry has research productivity

200

38

40
35

34

28

26

26

150

131
120
108
100

88

35

31

29

127

128

135

134

136

138

141

144

147

149

30
25

+70%

96

20
15
10

Number of NMEs

Number of R&D expenditures (bn US$)

issues.

5
50

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
NMEs
Total industry

Figure 1: Global R&D expenses compared to NMEs2 (Strickland, 2012).

NMEs: New Molecular Entitites. It stands for an entirely new (chemical, but not biotechnological) product. It
does not include products with changed dosages or new therapeutic applications and is comparable with the first
submission of an active ingredient.

3
Time to develop a drug (years)

Introduction

15
14
13
+28%

12
11

0
1996 1998 2000 2002 2004 2006 2008 2010

Cost to develop a drug ($ mio)

Figure 2: Time to develop a new drug (CMR International, 2008).

1,300

1,500
802

1,000
500

+842%

318
138

0
1975 1980 1985 1990 1995 2000 2005 2010

Development Cost per NME (bn US$)

Figure 3: Cost to develop a new drug (Basu, 2010a; PhRMA, 2010).

4.6

3.4

3.7

4.9
4.2

3.7

3.8

2.3

+65%

2
0
2004 2005 2006 2007 2008 2009 2010 2011

Time of patent protection

after development (years)

Figure 4: Development cost per NME (Strickland, 2012).

15
10

-34%
5
0
1996 1998 2000 2002 2004 2006 2008 2010

Figure 5: Time of patent protection after product launch (CMR International, 2008).

Introduction

Since quite some time a trend has emerged in the pharmaceutical industry: the time to
develop a new product from the discovery of the active ingredient to the final drug
product has increased continuously (Figure 2). This coincides with increasing
development costs per NME (Figure 3 & Figure 4) caused on the one hand by longer
development times due to constantly intensifying regulatory requirements, and on the
other hand by increasing safety requirements of pharmaceutical products (Basu, 2010a).
In the pharmaceutical industry new substances are filed for patent protection very early
in the R&D process, often during discovery and before the beginning of product
development. Thus, longer development time results in a shorter patent protection period
(Figure 5) during which it can be sold exclusively before competitors or generics
manufacturer can imitate it (Basu, 2010a). Usually, sales decrease up to 80% after patent
expiry, mainly due to substitution by cheaper generics3 (Basu, 2010a). As a result,
todays new pharmaceutical products must generate more money in less available time.
Additionally, there is increasing pressure on drug prices by governments. This calls for
stable and efficient manufacturing processes right from commercial launch in order to
avoid inefficient and thus excessive manufacturing costs.
Many industries have designed concepts and methods to make the development process
more efficient and thereby shortening it (Yeh et al., 2008; Tessarolo, 2007; Boyle et al.,
2006; Koufteros et al., 2005; Gerwin and Barrowman, 2002; Palacios and Gonzlez,
2002). Due to the highly regulated development process in the pharmaceutical industry,
established approaches to integrated development from other industries cannot be used
without adaptations. In the pharmaceutical industry, new products are tested for efficacy
and safety in multiple clinical studies. If results are accepted by regulatory authorities, a
product is approved for sale. However, the commercial manufacturing process must be
identical to the process used during development and especially during production of
material used in late studies. Otherwise, there will have to be additional studies, resulting
in increased development costs and time (FDA, 2004). The transfer of the production

Generics main advantage are the lower production costs. There are three reasons for these: (1) Production was
already optimized for some years when the product was still patent protected. (2) There is a high potential of
production optimization at researching companies. For generics producers production is the central driver of
success, while traditional pharmaceutical companies consider production to be less important (Basu, 2010a). In
US pharmaceutical companies, losses due to inefficient processes are estimated to be as high as 50bn USD (Basu,
2010a; Macher and Nickerson, 2006). (3) Generics producers do not have to finance a large R&D driven
overhead. They usually only have a small development department dealing with the adaptation of products and
processes to the company and its equipment.

Introduction

process from development to commercial production is often sped up in order not to

waste time and hit the market as soon as possible. The transfer is thus often done in a
rudimentary manner, with the main aim only being enabling basic commercial
production. This often results in inefficient commercial processes and thus excessive
manufacturing costs. Major adaptations to commercial scale equipment and environment

Manufacturing process efficiency

are omitted in order to not further increase time-to-market.

1.00

Launch Site
Site not dedicated
to product launches

0.75
0.50
0.25
0.00
0

Production involvement during development

Figure 6: Effect of collaboration between development and production on manufacturing

process efficiency.4

As literature and case studies suggest, there is one specific method to avoid the issues
described above: integrated development with a special focus on cross-functional teams
(Tessarolo, 2007; Koufteros et al., 2002, 2005; Yeh et al., 2008; Boyle et al., 2006;
McDonough, 2000). Central to this concept is the early integration of production during
development. This allows ensuring in an early phase that the developed processes can be
efficiently implemented in a commercial scale and with commercial-scale equipment.
Data from practical examples demonstrate that stronger collaboration of development
and production in companies leads to more efficient processes (Figure 6). The more
advanced a company becomes in integrated development, the earlier processes are
adapted and optimized to the commercial scale environment. Ideally, the processes
transferred into commercial production do not need any further optimization and do not

Data taken from unpublished Operational Excellence (OPEX) in the Pharmaceutical Industry Benchmarking
2004-2012 (Chair of Production Management, Institute of Technology Management, University of St.Gallen).
Manufacturing process efficiency is calculated as product of Yield (%), Rejected Batches (%), Overall OEE (%),
and Deviations (%). Production involvement during development is based on the question "Manufacturing
engineers (e.g. Industrial engineers) are involved to a great extent in the development of new drug formulation
and the development of the necessary production processes", assessed by a 5-point-Likert scale. All data is based
on information of 91 participating pharmaceutical companies.

Introduction

cause excessive manufacturing costs. In the pharmaceutical industry, development and

production are separated and work more or less as silo-organizations. Through an
improved collaboration, manufacturing costs could be significantly decreased.
Furthermore, the continuous increase of development costs and time is halted.
By now, a model of integrated development applicable to the pharmaceutical industry
has been missing. Such a model should specify how to shape the integrated development
process, with a focus on how to involve production into development as early as
possible. Through integrated development, manufacturing process efficiency is increased
while manufacturing costs are decreased. With a solid process design less problems will
arise, and thus less costs accumulate: "quality of the development process dictates the
quality of the manufacturing process that follows and will lead to cost savings in
manufacturing!" (Basu, 2010a, p. 33). FDAs Quality by Design initiative takes some
needed first steps into that direction.

1.3 Terms and Definitions

1.3.1 The Pharmaceutical Industry
This dissertation exclusively deals with the pharmaceutical industry5 and is thus
specifically focused. This focus was chosen because other industries (mainly electronics
and mechanic engineering industry) are more advanced regarding integrated
development and supporting methods are applied almost by default (Gerwin and
Barrowman, 2002). Apart from that, insights from other industries cannot be applied to
the pharmaceutical industry as is, mainly because it is a highly regulated industry6. This

The term pharmaceutical industry is equal to the Life Sciences industry, covering both the pharmaceutical and the
biotechnological industry. Although there are some differences between these industries (e.g. different
manufacturing principles, different regulatory requirements, different manufacturing scales, etc.), they share main
characteristics and are thus considered as one industry.

In this dissertation, the following industries are covered by the term highly regulated industries: the
pharmaceutical, the biotechnological, to some extent the chemical, to some extent the food, the aerospace, and the
atomic industry. They all share the fact that deficiencies in their products can cause massive damages to the
consumer. They have to fulfill highest (safety-)requirements. Generally, they (mainly the production facilities) are
inspected regularly by regulatory authorities. Furthermore, highest risks are common to all these industries. Thus,
final products cannot be improved by experiments but rather have to be fully functional and safe even for the first
prototype (e.g. when building a nuclear power plant, all potential errors must be identified and eliminated during
design and development phase in order to avoid massive damages). To substitute tests under real conditions,
simulations and models are often used by these industries.

Introduction

alone is not enough reason to not be able to adopt concepts from other industries without
major adaptations, especially since there are some examples from highly regulated
industries (mainly aerospace industry) (Basu, 2010b; Araujo and da Cruz, 2000; Mendes
et al., 2002; Terwiesch and Loch, 1999). It is rather the combination of high regulation,
highest safety and quality standards, and the somehow to other industries not comparable
development process that makes the pharmaceutical industry special and thus requires a
different approach and major adaptations to established concepts.
In the pharmaceutical industry production facilities and processes are regularly inspected
by regulatory authorities7. They define, control, and enforce new standards and
guidelines. In some markets it is only possible to sell products from certified production
sites (e.g. in the US it is only possible to sell products that were produced in FDAcertified production sites). The reasons for high regulation are highest quality, cleanness,
and safety requirements in order to meet patient safety. Regulatory agencies validate
both production equipment and processes.

1.3.2 The Launch Site

Launch sites are manufacturing sites dedicated to the launch of new products. These sites
are usually equipped with highest technological standards. In general, new products are
transferred from development to launch sites where the manufacturing process is then
further adapted to the commercial scale. As soon as newly introduced products are
established, it is decided whether they stay at the launch site (mostly in case of
strategically important products) or are transferred to a secondary manufacturing site.
Thus launch sites are often high capacity sites where many different products are
produced (compared to secondary manufacturing sites that are often dedicated to one
single product). Traditionally, launch sites are the connection of development and
commercial production.

The most relevant regulatory authorities (also for this dissertation) are USAs Food and Drug Administration
(FDA), Europes European Medicines Agency (EMA), and Switzerlands Swissmedic.

Introduction

1.3.3 The Pharmaceutical Development Process

A large portion of the pharmaceutical development process is used for testing a
substance for safety and efficacy (Figure 7). This is inevitable since the final product will
be applied directly or indirectly in humans. Gradually along the development process,
first safety and then therapeutic efficacy are tested and demonstrated. Products are only
approved by regulatory agencies if they are safe and have a demonstrable therapeutic
effect.
Development is divided into chemical and pharmaceutical development. The former
covers the development of the active pharmaceutical ingredient (API). This is the
ingredient which is responsible for a drugs therapeutic effect. Pharmaceutical
development, on the other hand, deals with the development of the final drug product. Its
administration form, e.g. a pill, a spray, or a liquid for injection, and dosage are essential
for the therapeutic effect to unfold. This dissertation only covers pharmaceutical or drug
product development.

Development Process
Discovery

Early Development

Research

Late Development

Pre-Clinical Development

Clinical Development

Registration
Launch

Lead
Identification

Lead Optimization In Silicio Models

Candidate Selection /
First Toxicity Dose

In Vitro Models

Animal Models

Phase I

First Human Dose

Phase II

First Efficacy
Dose /
First Patient Dose

Phase III

Product Decision

Registration

First Submission

Global Launch

First Launch

First Approval

Figure 7: The pharmaceutical development process.

Development begins with the identification of leads8 that are further optimized. The most
promising lead becomes a so called development candidate. During early development, it
is pre-clinically tested in a lab environment and later in animal models. Then three
clinical phases follow, where tests in humans are conducted in order to test the safety
and efficacy as well as to gain more knowledge about the drug.

The term lead describes a chemical or biological molecule to which a clinical effect is attributed (at least in
theory).

Introduction

Clinical Development Phases in Pharmaceutical Development

Clinical studies performed during development of new products are described as follows
(Andrews, 2009). Additional data is available in Table 1.

Table 1: Clinical phases.

Clinical phase I

Clinical phase II

Clinical phase III

Clinical phase IV

~1 year

1-2 years

1-3 years

open

few healthy
humans

few hundred
target patients

several hundreds
to thousands
target patients

study-dependent

Study duration:
Study
participants:

Clinical phase I studies are usually conducted in a small number of healthy humans.
They are typically used to assess ADME (absorption, distribution, metabolism, and
excretion) attributes, meaning to gain knowledge about how the substance behaves in the
human body, as well as tolerance data in order to plan patient dosing in phase II studies.
Clinical phase II studies are typically conducted in a few hundred patients. The goal is to
test efficacy of the drug and demonstrate its clinical effect (Proof-of-Concept, PoC).
They are also used to gain further knowledge on dosages.
Clinical phase III studies are usually studies involving a large number of target patients
(several hundreds to thousands). The goal is to demonstrate safety and efficacy for
registration. In general, at least two adequate studies are required by regulatory agencies
for the approval of a new drug. Phase III studies can also be conducted in order to
develop new therapeutic indications.
Clinical phase IV studies are post-approval studies. Usually they are used to gain
extended data about the product and its mechanisms in order to allow for more specific
and optimal treatment.

During the three clinical phases many development projects are terminated mainly
because they do not meet the requirements and thus constitute a risk or fail to have the
desired effect. In total, it is believed that only about 1% of all drug candidates master the
path from pre-clinical development to a final product (PhRMA, 2010). As soon as

10

Introduction

enough data about safety and efficacy is collected, usually during or at the end of clinical
phase III, the drug product is filed for submission with the regulatory agencies. It also
has to be specified where and how it was and will be produced. Thus a detailed
manufacturing process is submitted and ideally also approved.
Parallel to clinical development, the product is technically developed as well. During the
clinical phase I mainly the formulation and basic manufacturing processes are developed.
During phase II, the manufacturing process is developed in small scale environment (lab
scale) and subsequently scaled-up to large scale. During technology transfer before or at
the beginning of phase III it is finally transferred from development to production. It is
often only rudimentarily adapted to work in commercial scale with commercial
equipment and to produce enough product and data to register with regulatory agencies.
Since this is a sub-optimal process, global launch manufacturing problems often arise
and lead to massive delays. In this phase launch sites have an important role, as they
serve to adapt manufacturing processes to commercial scale in a trial-and-error
procedure. Major changes in the approved process entail subsequent filings and imply
further delays.9 If the process is not adapted, it is produced with an inefficient
manufacturing process in routine production. This inevitably leads to increased
manufacturing costs.
As Basu (2010b) appropriately remarks, "If process development is largely empirical in
nature, then manufacturing becomes a 'Big Experiment' and learning on the plant floor
can be very expensive" (Basu, 2010b, p.30).

Excursus: Quality by Design A Recent FDA Initiative

There exists a first holistic approach to product development in the pharmaceutical
industry. However, it is still rather conceptual and mostly theoretically. It was designed
by the FDA and recently launched as the initiative Quality by Design (QbD) (FDA,
2007).

Any changes to the product and the manufacturing process must be documented and filed with regulatory
authorities. If major changes influence product quality or efficacy, a clinical study (with only few participants)
has to be conducted in order to show that the product is equivalent to first approval.

Introduction

11

Its main goal is to induce a shift from the currently prevailing Quality after Design10.
Regarding process development and quality, a shift from current re-active methods to a
pro-active thinking is to be achieved. Primarily the initiative should improve quality of
pharmaceutical products, mainly by defining the manufacturing process qualityfriendly and by identifying those production steps that could cause quality issues early
during development. These steps can then be closely monitored during production.
Insufficient quality can thus be identified right at the occurrence and be corrected this
leads to less scrap. The application of QbD improves the understanding of the product
and especially of the process.11
As a benefit of applying QbD companies are offered a simplified process of registration
by the FDA. Furthermore, QbD should reduce development time and along with that
development costs decrease as well. Additionally, production costs can be reduced with
a consequent application of QbD. As of the definition of QbD, production should be
involved early when defining the production process in development so that process
scale-up runs simplified and prepared and processes transferred to production can be
implemented and applied in an efficient way (Yu, 2008). Further benefits from QbD
application include: Reduced costs of quality, shortened process development time,
increased flexibility for process adaptations or changes, and reduced efforts for
regulatory authorities (McCormick, 2006; Tozer, 2008).
Full QbD implementation might have a major drawback. QbD is FDA-driven and
adopted by many other regulatory authorities. Some, however, still accept solely
classic registration. If a company intends to serve different markets of which some
regulatory authorities accept QbD registrations and others do not, it has to prepare two
major different registration dossiers. This might also be a reason why some companies
follow QbD approaches internally, but still register their products in the classical way.
In many companies QbD is not fully implemented and can thus not unfold its full
potential (Basu, 2010b; Rathore, 2010). Reasons therefor are identified quickly: (1) The

10

Quality after Design means products are inspected for quality after production. This can lead to excess amounts
of scrap. Current efforts such as Lean Six Sigma, RFT (Right the First Time), OPEX (Operational Excellence),
etc. aim to monitor product quality after product launch and eventually to improve it through production
optimizations (Basu, 2010a).

11

Thorough knowledge of manufacturing processes improves production as well. Efforts like Lean Six Sigma
(among others) to optimize production are rather short-term measures because no real process understanding is
built up (Basu, 2010a).

12

Introduction

understanding of QbD is varying tremendously, (2) responsible managers do not know

how to efficiently implement QbD concepts, (3) confidence in QbD and thus also
commitment is missing, (4) initial implementation is difficult and challenging, mainly
because a broad knowledge base has to be created in order to profit in future projects,
and (5) more technical reasons (Rathore, 2010).
QbD introduces substantial changes in the technical development process (compared to
the classical and widely used approach). However, clinical development is not affected.
Figure 8 shows the essential process steps in product development according to QbD
principles (Yu, 2008; Harper, 2009). These steps are detailed further below.

QbD Process

TPP

TPQP

CQA

Process
Design

CPPs /
CMAs

process definition
(to achieve
quality)

identification of
critical process
steps
(to achieve
quality)

Design
Space

Production

Figure 8: Process model of Quality by Design (Yu, 2008). 12

Initially the Target Product Profile (TPP) is defined. It describes a product in

development on a largely abstracted level, in order to be defined roughly and to fit to the
current strategy. Basically, it can be outlined as "planning with the end in mind" (Yu,
2008, p. 784). From the TPP, the Target Product Quality Profile (TPQP) is derived. This
profile sets the parameters that determine quality in order to fulfill the TPP. Typically,
TPQP characterizes properties like "Tablet Characteristics, Identity, Assay and
Uniformity, Purity / Impurity, Stability, and Dissolution" (Yu, 2008, p. 784), thus all
kinds of physical product characteristics that are defined by engineers in form of
definitions for pH-value, solubility, melting point, and others.
Critical Quality Attributes (CQA) are defined in the following step. This covers
"physical, chemical, biological, or microbiological property or characteristic that must be
controlled directly or indirectly to ensure the quality of the product" (Yu, 2008, p. 786).
12

TPP: Target Product Profile; TPQP: Target Product Quality Profile; CQA: Critical Quality Attributes; Process
Design; CPPs: Critical Process Parameters; CMAs: Critical Material Attributes.

Introduction

13

Thereafter, the Manufacturing Process is defined. During this step it is important that
production is already involved and assists to shape the manufacturing process in a most
realistic and practical way. Specialists from launch sites or Transfer Organizations are
most likely to possess the most expertise and experience therefor. Based on CQA, those
Critical Process Parameters (CPP) and Critical Material Attributes (CMA) are
identified, which have a direct or indirect influence on product quality. These parameters
and attributes have to be monitored continuously in commercial production in order to
control product quality.
All this preparatory work leads to the definition of the Design Space. There are many
differing definitions of the term design space. Generally and especially in the context
of QbD, it is defined as definition of all processes and parameters and their ranges and
critical margins.13 These ranges and margins are identified and set by experiments,
calculation models, and preliminary built-up knowledge. The design space directly
influences manufacturing of the final product and the monitoring of the identified
process parameters.
However, it has been found to be a problem that the manufacturing process is mainly
designed by development rather than by production. This implies that the process is
defined for a small scale rather than for large commercial scale. These differently scaled
processes can differ significantly, what also affects CPP and CMA and thus also the
design space. If commercial manufacturing is started with the design space for lab scale,
usually major adaptations are necessary. The challenge is involving production in
process development. Thereby, scale-up occurs at an early stage in development and
leads to a scale-adapted design space and thus to a smooth product launch with efficient
manufacturing processes. This involvement is only possible if experts from launch sites
can share their knowledge and make it accessible to development specialists. This can be
achieved by integrated development approaches (especially cross-functional teams).
Ranges for specific parameters defined in the design space are a distinct advantage of
QbD. In traditional pharmaceutical production, validated manufacturing processes
cannot be changed without regulatory effort. For products approved within QbD, the

13

A descriptive example: For a certain process step the pH value is identified to be a CPP. For example, it has to be
13. Through experiments, prior acquired data and knowledge, and scientific methods it is shown that the process
step also works at a pH value between 12 and 14 with no difference in the results. In the design space the pH
value is defined as within the range of 12-14 to produce the desired quality.

14

Introduction

processes can be changed as long as it can be shown that the critical parameters stay
within defined ranges. QbD brings a lot of flexibility in commercial production and
effectively reduces administrative and regulatory effort for process adaptations.
Contrary to theory, a detailed and practical implementation model for QbD is missing.
Such a model would show how to efficiently implement QbD in practice and what the
emerging consequences could be. This dissertation contributes to understand the
interaction between development and production as well as the influence of launch sites
and Transfer Organizations. Further it shows how these insights can be introduced into
QbD.
One consequence of the science driven QbD approach is occurring in technical
development: There is a shift, mainly driven by regulatory agencies, away from
inflexible phases in technical development towards a more continuous approach (FDA,
2011). Late process development is called process design phase and used to deliver a
scientific rationale of why the product is how it is. Following used to be technology
transfer and validation, now called process performance qualification. In the end is
continuous process verification, meaning a continuous monitoring of the process and the
product quality. This is more aligned with ongoing QbD efforts, meaning to use a
scientific approach instead of trial-and-error. However, it is still in a rebuilding phase
and its full effects are yet to be harvested.

1.4 Research Goal and Question

This dissertation stands in the tradition of applied social sciences after Ulrich (1981) and
Bleicher (2004). Initial point is a current problem of the producing industry with a
relevant question for the management of international companies. The goal is thus to
generate necessary knowledge to solve the practical problem. In the center is the
development of a model for the design and modification of the social reality (Ulrich,
1981). Regarding the challenges in product and process development of pharmaceutical
companies and described deficiencies in literature, this dissertation attempts to answer
the following question:

Introduction

15

Does the integration of a manufacturing perspective in development lead to higher

production efficiency at product launch in the pharmaceutical industry?
Indicators representing production efficiency at product launch are identified. The
concept of cross-functional teams is adapted and applied to the pharmaceutical
development process. The influence of launch sites or Transfer Organizations is
investigated and transferred into a descriptive model.
The overall research question is broken down into the following sub-questions. They are
leading the research project and contributing to the overall answer.
How can the efficiency of newly introduced production processes be measured
(operationalized)?
Can selected approaches from other industries be transferred to the
pharmaceutical industry (e.g. cross-functional teams)? If yes, how is the
development process to be modified and what are success factors?
What is the role of Transfer Organizations and launch sites in integrated
development and can they help to connect development and production?

1.5 Research Design

1.5.1 Research Concept
The research concept describes the basic proceeding and the methods used in order to
answer the research question. In general, this research follows the case study research
concept.
A three-phase and five-step proceeding was used to finally lead to a validated descriptive
model of integrated development in the pharmaceutical industry (Figure 9). First,
existing concepts (including success factors, methods, and tools) of integrated
development were identified in literature. Second, according to their contribution they
were characterized and put together into a reference framework for the pharmaceutical
industry. Third, the developed framework was validated in an international survey with
quantitative and qualitative elements. Fourth, the survey results lead to propositions and
characterizations that were applied in practice. This was described in descriptive case
studies and constitutes the most important part of this case study research concept driven

16

Introduction

proceeding. Fifth, industry and case study insights transferred the reference framework
into a descriptive reference model for the pharmaceutical industry.
Only pharmaceutical companies being globally active and having multiple sites were
considered to be part of the research process. There were no other restrictions, however,
these criteria proved to be enough to obtain a quite homologous group of companies.
This is mainly to ensure that companies and their challenges but also developed and
proposed solutions are applicable to all participants and research results can be
generalized.

Reference framework

Validation

Descriptive reference model

Literature review
Reference framework

Industry survey
Case studies

Descriptive reference model

Figure 9: Research concept.

1.5.1.1 Phase 1: Reference framework

In order to gain theoretical knowledge about integrated development, the relevant
literature about integrated development, cross-functional teams, and success factors was
analyzed. Existing concepts were translated into a reference framework. Accompanying
expert interviews ensured practice relevance. The reference framework contains all
relevant factors, characterizations, and connections of single topics.
1.5.1.2 Phase 2: Validation
In a quantitative and qualitative industry survey the reference framework was tested.
Practical implications were then tested in practice in participating companies. Findings
were described in case studies.

Introduction

17

1.5.1.3 Phase 3: Descriptive reference model

Practical insights from the survey and case studies were used to validate the reference
framework and to transform it into a descriptive reference model. As a result of defined
criteria at the selection of contributing companies, the descriptive model can be
generalized for the pharmaceutical industry. The descriptive model demonstrates how
integration in the pharmaceutical development process mainly in the form of crossfunctional teams as well as early and extended collaboration has to be shaped in order
to positively contribute to production efficiency. Furthermore, the model contributes to
practical implementation of QbD.

1.5.2 Research theory

The main goal in management science is to find explanations and theories as to why
some companies perform better than others (Rumelt et al., 1991). There are two different
perspectives to analyze and explain a firms performance: the internal and the external
perspective. The external perspective focuses on attractiveness and competitiveness in
the industry and the market (Porter, 1980). While the internal perspective considers a
companys success as the ideal allocation of internal resources, as described in the
resource based view (RBV).
The internal resource perspective was first mentioned by Penrose (1959). At that time, it
did not form a self-standing theory. This came later, when the resource based view of
the firm was defined (Wernerfelt, 1984). Its popularity and scientific acknowledgement
then grew substantially with the work of Barney (1991). Over time, many authors
contributed to its conceptual development.
The RBV focuses on resources and capabilities as essential for the creation of
competitive advantage. A firms resources are described as all assets, capabilities,
organizational processes, firm attributes, information, knowledge, etc. controlled by a
firm that enable the firm to conceive of and implement strategies that improve its
efficiency and effectiveness (Barney, 1991, p.101). Competitive advantage is achieved
by implementing a value creating strategy not simultaneously being implemented by
any current or potential competitors (Barney, 1991, p.106). The valuable, rare,
inimitable, and non-substitutable (V.R.I.N.) resources determine which markets may be
entered and what level of profit can be expected (Wernerfelt, 1989; Wang and Ahmed,

18

Introduction

2007). However, simply having advantageous resources at hand may not suffice for
competitive advantage: distinctive capabilities related to the use of resources are needed
(Penrose, 1959).
A clear definition of RBV terminology (e.g. what resources are) is missing (Thomas and
Pollock, 1999). It is suggested that the identification of V.R.I.N. resources responsible
for competitive advantage is achieved by finding superior performance and then
connecting it to unique resources the firm appears to possess (Eisenhardt and Martin,
2000; Barney, 1991). Thus, the definition of the RBV theory is tautological (Wang and
Ahmed, 2007).
The business environment grew more dynamic. This challenged classic RBV
propositions: they were found to be static and not considering the influence of markets
dynamics (Eisenhardt and Martin, 2000; Priem and Butler, 2001). This led to the
creation of dynamic capabilities, combining both resources and dynamically to the
environment adapting capabilities, as an enhancement to the RBV (Teece et al., 1997;
Helfat, 1997; Eisenhardt and Martin, 2000; Zahra and George, 2002).
Dynamic capabilities are defined as the firms processes that use resources
specifically the processes to integrate, reconfigure, gain and release resources to match
and even create market change, and the organizational and strategic routines by which
firms achieve new resources and configurations as markets emerge, collide, split, evolve,
and die (Eisenhardt and Martin, 2000, p.1107). They are a firms behavioral
orientation to constantly integrate, reconfigure, renew and recreate its resources and
capabilities, and most importantly, upgrade and reconstruct its core capabilities in
response to the changing environment to attain and sustain competitive advantage
(Wang and Ahmed, 2007, p.34). Thus they are not processes, but rather embedded in
processes (Wang and Ahmed, 2007, p.34).
Like in the RBV, terminology is not definite: for example, dynamic capabilities are
defined as the firms ability to integrate, build, and reconfigure internal and external
competences to address rapidly changing environments. Dynamic capabilities thus
reflect an organizations ability to achieve new and innovative forms of competitive
advantage given path dependencies and market positions (Teece et al., 1997, p.516).
This is very similar to the definition of capabilities in RBV: The key role of strategic
management in appropriately adapting, integrating, and reconfiguring internal and

Introduction

19

external organizational skills, resources, and functional competences to match the

requirements of a changing environment (Teece et al., 1997, p.515).
Development of new products is a crucial activity of most firms: new products determine
a firms success. They may constitute a competitive advantage per se, but also by being
on the market faster, to a better price, or better quality. Therefore, the ultimate goal is to
optimize the process of new product development in a way that new products are better
than competitors products regarding described attributes. The resources used in the
development process must thus be allocated highly dynamically in order to best support
the process and the product.
As the goal of this research is not the analysis of external drivers such as market and
environment, but rather the optimization of internal resource allocation, only the RBV
and its advancement dynamic capabilities are considered to be the valid research
theory.
A structured approach to the development process leads to improved allocation of
resources. This is best explained with the RBV. Therefore, the findings of this
dissertation will be theoretically discussed through the perspective of the RBV and its
dynamic capability enhancement.

1.5.3 Structure
This dissertation is structured in 7 chapters with the following content (Figure 10):
1.5.3.1 Chapter 1: Introduction
The first chapter describes the personal motivation for the research as well as the
theoretical and practical relevance. Important terms and concepts are introduced.
Furthermore, the research goal, question, design, and theory are defined.
1.5.3.2 Chapter 2: Theoretical Foundation
In chapter 2 insights from literature and theoretical basics are discussed. The focus
mainly lies on cross-functional collaboration, which is the most important aspect of
integrated development. Implications from the theoretical basis constitute the conceptual
framework.

20

Introduction

Chapter 1: Introduction
1.1 Motivation

1.2 Practical Relevance

1.3 Terms and

Definitions

1.4 Research Goal and

Question

1.5 Research Design

Chapter 2: Theoretical Foundation

2.1 From New
2.2 To Integrated
2.3 Concurrent
Product
Product
Engineering
Development
Development

2.4 CrossFunctional
Teams

2.5 Success Factors 2.6 Insights and

in Product
Theoretical
Development
Deficits

Chapter 3: Development of a Reference Framework

3.1 The Framework in General

3.2 Components in Detail

Chapter 4: Integrated Development in Practice

4.1 Industry Survey: An Empirical
Investigation

4.3 Insights from Current Industry

Practices

4.2 Special Aspects

Chapter 5: Successful Approaches to Integrated Development

5.1 Selection of Case
Study Companies

5.2 Conception of the

Case Studies

5.3 Case Pharmaco1

5.4 Case Pharmaco2

5.5 Insights from Case

Study Research

Chapter 6: Design Characteristics of an Approach to Integrated Development

6.1 Integrated Development as Facilitator

6.2 Design and Configuration of

Integrated Development

6.3 Conclusion

Chapter 7: Summary and Outlook

7.1 Theoretical Implications

7.2 Managerial Implications

7.3 Known Limitations

7.4 Further Research

Figure 10: Structure of the dissertation.

1.5.3.3 Chapter 3: Development of a Reference Framework

Based on the literature review, elements from existing concepts are put together into a
reference framework. This includes all factors, methods, and tools as well as connections
between single elements.
1.5.3.4 Chapter 4: Integrated Development in Practice
In chapter 4 the design and then results of the industry survey are described. General and
detailed industry insights are identified.

Introduction

21

1.5.3.5 Chapter 5: Successful Approaches to Integrated Development

Two case studies describe successful approaches to integrated development in practice.
In an excursus QbD application and implementation in practice is explained. The chapter
is concluded with a cross-case analysis and a short comparison to literature.
1.5.3.6 Chapter 6: Design Characteristics of an Approach to Integrated Development
Based on case study research and insights from the industry survey, a descriptive
reference model for integrated development in the pharmaceutical industry is developed.
1.5.3.7 Chapter 7: Summary and Outlook
Implications for research and practice are described. Limitations to this research as well
as possible areas for further research are mentioned.

2 Theoretical Foundation

This chapter builds the theoretical base of the research by reviewing the up-to-date
literature. The literature was screened for existing information to the topic of integrated
development in general and to some of its methods in particular. Therefore, the literature
about integrated product development, concurrent engineering, cross-functional teams,
and success factors was reviewed. The literature on integrated development discusses its
role in development performance and describes supporting tools and methods. The
outcomes of this literature review provide the elementary input for the reference
framework.

2.1 From New Product Development

The development of new products constitutes a central strategic activity for most
companies (Yeh et al., 2008; Koufteros et al., 2005; Gonzlez and Palacios, 2002). In the
early 90ies the development of new products and processes, with the main focus on
products, amounted to 76% of the industrial research in the USA (Ettlie, 1995). The
main reason for its strategic importance is the fact that new products make up an
increasing part of sales. Todays time is characterized by fast change and companies are
afflicted by the fact that markets demand innovations in constantly shorter cycles and
product life cycles as well as increasing product quality (Yeh et al., 2008). As a logical
consequence, companies face the difficult task of decreasing development times and
costs while simultaneously increasing product quality and innovation (Yeh et al., 2008).
This can be achieved by increasing the efficiency of the development process. Efficiency
can be measured by either one or combinations of the following indicators or as impact
on future manufacturing costs:
Development time: it describes the time span from the generation of the idea for
a product until its market introduction. It is also called NPD-time or time-tomarket.
Development costs: they describe all development relevant costs that accumulate
during the development time. Sometimes they are referred to as NPD-costs.

24

Theoretical Foundation

Product quality: it describes the quality of the finished and marketed product.
Manufacturing costs: they describe all costs that are incurred to manufacture the
product. They are also influenced during development: if the manufacturing
process is developed to be effective and efficient, no adaptations are required
(which means no additional costs). Furthermore, inefficient processes result in
excessive manufacturing costs.
In order to address the development of new products in a systematic way, a structured
process was defined: the New Product Development (NPD) process14 (Krger et al.,
2010). This approach is considered to be the paradigm of new product development
(Krger et al., 2010; Gerwin and Barrowman, 2002). The NPD process is a sequence of
different steps, activities, and decisions during the development of a new product from
the initial idea to the commercial manufacturing of the final product (Yeh et al., 2008;
Cooper and Kleinschmidt, 1997). Figure 11 depicts the NPD process used in this work.

NPD Process

Customer
requirements

Development
proposal

Project
planning

Conceptual
design

Product
design

Prototype &
test

Process
development &
pilot run

Manufacturing

Customer

Figure 11: The NPD-process according to Yeh et al. (Yeh et al., 2008, p.138)

Cooper & Edgett (2003) demonstrated that the success rate of development projects
following the NPD process lies at around 60%. Traditional NPD processes are followed
sequentially, they are not overlapping or integrated (Gerwin and Barrowman, 2002).
Thus, no activities and process steps are executed in parallel. In order to render the
process more efficient it is proposed avoiding wastage of resources on peripheral
activities, changes, and reworks (Yeh et al., 2008, p.132). This means generally the
prevention of unnecessary activities (Palacios and Gonzlez, 2002). Furthermore, it was

14

There is not one single NPD process, there are rather various different variants described. They do not
significantly differ in contents and goals, but rather in their general definition and along with that in the number of
defined steps. Among others there are variants with four (Sun and Wing, 2005), seven (Yeh et al., 2008), eight
(Nijssen and Frambach, 2000), or a variable number (Thia et al., 2005) of steps. Furthermore, these approaches
differ in their extent of formality. An example of a very formal NPD process is the Stage-Gate NPD process
(Cooper and Edgett, 2003). In this dissertation, the term NPD process refers to the definition by Yeh et al. (Yeh et
al., 2008, p.135f).

Theoretical Foundation

25

searched for influence factors responsible for shortening the development time. The
following factors (among others) were identified and further researched for their
influence: modularity at product structure level (common basis for an entire product
family) (Danese and Filippini, 2010), product vision (common vision and idea about a
product in project teams) (Tessarolo, 2007), and integration15 (Tessarolo, 2007; Ettlie,
1995). It was demonstrated, that under certain conditions they all have a positive effect
on NPD process performance. Thus they lead to better manufacturing processes (higher
manufacturability) while shortening the development time.
Furthermore, different tools, methods, and practices with positive effects on NPD
processes were identified (Palacios and Gonzlez, 2002). In different studies it was
shown that the consequent and consistent application of one or more such tools increase
NPD process success significantly (Yeh et al., 2008; Thia et al., 2005; Gonzlez and
Palacios, 2002). Despite these obvious benefits, they are applied only to a small extent in
development, particularly compared to production (where such tools are applied
regularly and with great success) (Yeh et al., 2008). Various reasons therefore were
identified: low level of awareness among project managers, limited faith of managers
on the effectiveness of NPD tools, rejection of change due to culture (Thia et al.,
2005, p.407) as well as the fact that R&D engineers are often not familiar with the tools
and do not know when in the development process to apply them (Yeh et al., 2008).

2.2 To Integrated Product Development

The NPD concept was extended and transformed into the IPD concept (Integrated
Product Development). Thus, IPD represents an advancement of NPD. The application
of IPD processes is considered to be one of the biggest trends in new product
development (Gerwin and Barrowman, 2002). IPD is a management concept with the
goal of improving NPD performance, mainly by overlap, parallel execution, and

15

Generally, the strategy of integration is considered to be the key to NPD success (Koufteros et al., 2005). For the
highest possible effect, integration should start the earliest possible. It can be divided in internal and external
integration. While internal integration includes concepts like cross-functional teams, concurrent engineering, and
early involvement of all relevant organizational units, external integration is subdivided into customer and
supplier integration. Customer integration describes the co-operation of the developing company with its
customers. This ensures that customer requirements are considered and development is focused on them
(Koufteros et al., 2005). Supplier integration is again subdivided in product or black box integration (suppliers
develop parts for the final product on their own) and process or grey box integration (collaborative development
in order that supplier processes can be integrated in the final design) (Koufteros et al., 2005).

26

Theoretical Foundation

concurrent workflow (Naveh, 2005, p.2791). The generic IPD process consists of the
following four phases: detailed task definition, conception, detailed development work,
and prototype design (Krger et al., 2010). The most important characteristics are the
degree of overlapping and interaction of NPD activities (Gerwin and Barrowman, 2002).
The following is typical for IPD concepts and is most often applied to achieve IPD:
cross-functional NPD teams (CFT) and concurrent product development processes
(CDP) (Boyle et al., 2006, p.38); cross-functional and interdisciplinary teams (Griffin,
1997b; McDonough, 2000); overlapping of certain activities during the development
process, leading to a partial or complete parallel execution, as well as interdisciplinary
teams (Krger et al., 2010; Gerwin and Barrowman, 2002); a very holistic product
consideration, teamwork, customer orientation, information and communication flow,
the application of new technologies, and the dynamic work flow (Krger et al., 2010);
concurrent

engineering,

design

for

manufacturability,

early

manufacturing

involvement (Gerwin and Barrowman, 2002, p.939). Among others, creating more
manufacturable design has many advantages compared to other approaches (for
example the simpler NPD approach) and is responsible for its growing popularity
(Gerwin and Barrowman, 2002, p.938).
The most frequently mentioned cross-functional or interdisciplinary teams and
concurrent engineering are administrative methods that increase efficiency of IPD
compared to NPD (Boyle et al., 2006). However, they can be accompanied by critical
aspects, for example burn out of team members and too many meetings (Krger et al.,
2010; Gerwin and Barrowman, 2002). These two and their consequences are main
reasons why the implementation of the IPD process requires a high degree of
coordination (Gerwin and Barrowman, 2002). For the same reason, commitment of top
management (Boyle et al., 2006; Swink, 2000) and the willingness of different functional
units to collaborate (Boyle et al., 2006) are critical for the success of IPD projects.
There exist further more practical and technical tools and techniques (for example QFD,
FMEA, Fishbone, and others) with the goal of improving the IPD process. They can be
divided in three areas: organizational design approach, information-processing
approach, and application of total quality management principle (Gerwin and
Barrowman, 2002, p.939). Both Boyle et al. (2006) and Yeh et al. (2008) provide an
overview of the most frequently used tools and methods. Yeh et al. (2008) further
provides an evaluation of the usage frequency during the NPD process steps as well as

Theoretical Foundation

27

the influence of the tools and techniques.16 The performance of development projects
following IPD principles can be measured by development time, development cost,
product quality, and overall product performance (Gerwin and Barrowman, 2002,
p.940). These indicators as well as the achieving of their set goals are all inter-connected
and depending on each other.
By the consistent implementation of many IPD principles and the application of various
tools and techniques, Toyota managed to shorten the development time of new car
models by two to three years (Naveh, 2005). Gerwin & Barrowman (2002) provide a
general overview of companies that have so far been analyzed for their implementation
of the IPD process.
Due to their effectiveness in the IPD process17 on the one hand and because of their
administrative and organizational nature on the other hand, the following concepts of the
IPD approach are discussed in more detail (Yeh et al., 2008): Cross-functional
(interdisciplinary) teams and concurrent engineering. They both are similar to parts of
QbD and therefore highly relevant. They are connected to higher manufacturability,
which consists of the ability to manufacture a product as well as of the efficient adoption
(without adaptations) of developed manufacturing processes. Furthermore it was shown,
that especially cross-functional teams are very common in development of investigated
companies (Yeh et al., 2008).

2.3 Concurrent Engineering

Concurrent Engineering (CE) is very powerful in shortening the development time
(Kamrani and Vijayan, 2006). It consists of two major components, both equally
contributing to this goal: On the one hand the overlapping of activities (Terwiesch and
Loch, 1999). Different development process tasks and steps are partially or entirely
executed in parallel, which results in saving development time. On the other hand the
early involvement of other relevant organizational units (for example production and

16

The usage frequency (table 6) was assessed at 88 different high-tech companies from Taiwan (Yeh et al., 2008,
p.141f). Derived from that is the influence on the overall performance of the IPD process (Table 7) (Yeh et al.,
2008, p.145f).

17

The table (table 5) provides an overview of tools and techniques used for increasing efficiency during the IPD
process (Yeh et al., 2008, p.140). Most of them are more of a technical nature and aim to simplify the
development engineers work. Only very few are related to organizational topics.

28

Theoretical Foundation

marketing) (Kamrani and Vijayan, 2006). The degree of this involvement can be
measured indirectly by the product design quality manufacturability (Doll et al., 2010;
Swink, 1999). It is an indicator for the degree of fit between product design
specifications and capabilities of the manufacturing process (Adler, 1995) and thus also
indirectly to which extent the production is involved in the development of new
products. Early involvement of other organizational units gives participants the ability to
participate before decisions are taken (Koufteros et al., 2005). Additionally, information
is distributed to all participants (Koufteros et al., 2005). Thus, erroneous developments,
developments heading in the wrong direction, and double work due to missing
information coordination can be prevented and time and costs can be saved. The
involvement also increases communication and thus reduces uncertainty among team
members (Koufteros et al., 2005). Concurrent engineering is using more and more IT
tools and methods. By this it is ensured that generated knowledge and know-how is
available and can be accessed during future projects, which in turn can again shorten the
development time (Kamrani and Vijayan, 2006).

2.4 Cross-Functional Teams

In cross-functional teams (CFT) different specialists of different organizational units
find together in order to commonly work on a development project. They share
information and take decisions about product, process, and production together
(Koufteros et al., 2005). This functional and organizational diversity speeds up product
development and improves development performance (Koufteros et al., 2005; Gerwin
and Barrowman, 2002; Droge et al., 2000; McDonough, 2000). Mainly, it is ensured that
production is involved in the development and developed manufacturing processes are
viable. A common process understanding and unified visions are central in order to
prevent different interpretations and to compensate differences (Gerwin and Barrowman,
2002).
Already in the late nineties Griffin showed that about 64% of all researched projects
used cross-functional teams in development (Gerwin and Barrowman, 2002; Griffin,
1997b). This number even increases to 84% if only highly innovative projects are
considered (Koufteros et al., 2005; Griffin, 1997b). Today, this number is at least as high
and for some industries even higher.

Theoretical Foundation

29

All involved organizational units usually have their own orientations, cultures, and
languages. In cross-functional teams they all come together and must be managed. For
successful and productive collaboration in cross-functional teams some team
characteristics were identified (McDonough, 2000):
Goals and visions define boundaries for the team in order to prevent it from
constantly re-defining itself and its tasks.
Team autonomy enables the team to take decisions on its own.
A general climate supporting cross-functional collaboration is needed.
Furthermore, a climate of importance and urgency of the project leads to
constructive pressure.
The ideal team mix must be chosen to combine many different skills. By this,
different inputs can be processed in a most reasonable way. Functional diversity
helps project team members to understand the design process more quickly and
fully from a variety of perspective, and thus it improves design process
performance. Moreover, the increased information helps the team to catch
downstream problems such as manufacturing difficulties or market mismatches
before they happen, when these problems are generally smaller and easier to fix
(Brown and Eisenhardt, 1995, p.367).
Strong team leadership enables the team. Furthermore, it provides directions for
the team members without hindering them to work freely.
Top management support should be visible by commitment to the project and
the team. Top management should mainly be helping in the case of problems, it
should encourage the team and be making things happen (McDonough, 2000,
p.225f).
Champions are individual team members that are indirectly valuable for the
team. They can be distinguish by special efforts in certain project steps or
processes and thus help to significantly advance the project.
Cooperation between involved organizational and functional units facilitates the
project flow.
Commitment of all team members is crucial for project success because it leads
to common efforts in a common direction.
Each team member must be willing to contribute to the overall project success.
Respect, trust, and honesty between all team members promote the team culture.

30

Theoretical Foundation

2.5 Success Factors in Product Development

The success of new and integrated product development is strongly influenced by
success factors. In order to identify them in general as well as to find those that are most
commonly listed and those with the greatest influence on performance, a broad literature
review was performed. Additional to the search for new and integrated product
development in general, the literature was especially screened for the terms factors and
success factors in combination with NPD, new product development, IPD,
integrated product development, cross-functional teams, interdisciplinary teams,
team work, and concurrent engineering. Team characteristics mentioned in the
previous chapter were also considered and in most cases added as general success factors
on team level. Table 2 provides an overview of all analyzed papers, success factors, and
their mention frequency. Selected success factors, their characteristics, and their effect
on development performance are described in detail in chapter 3.2.2.

De Clerq, Thongpapanl, Dimov, 2011

Hirunyawipada, Beyerlein, Blankson, 2010
Nakata, Im, 2010
Barczak, Griffin, Kahn, 2009
Edmondson, Nembhard, 2009
Emery, 2009
Park, Lim, Birnbaum-More, 2009
Sarin, O'Connor, 2009
Hafer, Gresham, 2008
Kim, Kang, 2008
Appelbaum, Gonzalo, 2007
Cooper, Kleinschmidt, 2007
Sarin, McDermott, 2003
Sethi, Smith, Park, 2001
Holland, Gaston, Gomes, 2000
McDonough III, 2000
Song, Montoya-Weiss, Schmidt, 1997
Denison, Hart, Kahn, 1996
Pinto, Pinto, Prescott, 1993

18

Sh
a
r
e
vis d, c o
ion
m
m
,
s
upp on, a
Or
nd
or
ga
t
(cr niz ati ed by unifie
oss
on
d
se
n
f
i
unc al cli
or goals
ma
Te
tio mat
am
n and
n
e
a
a
s
g
l
)
c oem
tea uppo
lo
ent
m
c
r
Te
t
a
s
i
ve
tion
am
of
Re
/p
w
r
o
ard
xim
To
p/
ity
se
n
i
or
Te
ma
am
n
a
lea
g
em
der
ent
Fo
sh
r
s
i
m
p
u
p
al
por
p
r
t
oce
Cle
ss
a
r
rol
es
&
Re
r es
sou
pon
rc e
s
s
i
bil
/m
Co
itie
ix
m
m
s
itm
ent
C
r
e
ati
vit
y
C
o
mm
uni
c
a
Tru
tio
n/
st &
in
t
R
e
esp
rac
Au
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ec t
t
o
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nom
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Inf
or
soc ma l in
i
a
l c o terpe
hes r so
C
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r
o
o
n nal re
ss tea
la ti
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Fo
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p/
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a
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o
w
n
led
ge
t
r
ans
fer
p
r oc
ess

Theoretical Foundation
31

Table 2: Literature overview of success factors for cross-functional teams.18

(De Clercq et al., 2011; Hirunyawipada et al., 2010; Nakata and Im, 2010; Barczak et al., 2009; Edmondson and
Nembhard, 2009; Emery, 2009; Hyung-Jin Park et al., 2009; Sarin and OConnor, 2009; Hafer and Gresham,
2008; Kim and Kang, 2008; Appelbaum and Gonzalo, 2007; Cooper and Kleinschmidt, 2007; Sarin and
McDermott, 2003; Sethi et al., 2001; Holland et al., 2000; McDonough, 2000; Song et al., 1997; Denison et al.,
1996; Pinto et al., 1993)

32

Theoretical Foundation

2.6 Insights and Theoretical Deficits

In literature, most companies researched for their implementation of integrated
development are from high-tech, computer, electronics, and mechanical engineering
industry (Table 3) (Gerwin and Barrowman, 2002). Some examples from the chemical
industry are known, however, companies from the highly regulated pharmaceutical
industry are missing.
Analyzed companies traditionally operate as well in the B2B as in the B2C domains
(mainly in the mechanical engineering and mechanical and electrical components,
standard industrial code SIC 35 and 36) (Tessarolo, 2007). Especially B2B companies
share special motives for applying IPD methods and tools, e.g. the supplier shortens
development time in order for the buyer to be able to incorporate the part into its final
product without delay (Tessarolo, 2007). In B2C and other companies, shorter
development times are competitive advantages over their competitors (Naveh, 2005;
Droge et al., 2000; Swink, 2000). Whereas in the pharmaceutical industry the main goals
are (1) preventing delays during technology transfer and at product launch resulting in
shorter patent protection time, (2) avoiding time and cost intensive process adaptations,
(3) developing efficient and robust manufacturing processes and keeping manufacturing
prices low, and (4) gaining a high market share by being first-to-market (Droge et al.,
2000).
For the pharmaceutical industry, the interface of development and production is not
adequately defined. A scientific consideration is missing, defining when and how they
should intensify collaboration in order to make the development of the manufacturing
process more efficient. Moreover, the launch sites role is not described in detail and a
model is missing, stating when to integrate those in the development process.
Furthermore, a holistic process model that combines IPD principles with the
development process and characteristics of the highly regulated pharmaceutical industry
is missing.

Theoretical Foundation

33

Table 3: Overview of investigated companies and industries in literature.

Publication

No. of
companies

Research focus (industry, field of operation)

Danese & Filippini, 2010

186

Worldwide mechanical, electronic and transportation

companies

Doll et al., 2010

205

US and Canadian metal, machinery, mechanical,

electronic and transportation companies

Krger et al., 2010

Sports equipment

Yeh et al., 2008

88

High-tech firms

Tessarolo, 2007

154

Italian and Japanese business-to-business companies

Boyle et al., 2006

269

US and Canadian machinery, computer, electronics,

electrical, appliance and transportation organizations

Koufteros et al., 2005

244

Metal, machinery, electronic, and transportation

companies

Naveh, 2005

Hi-tech electronics

Vandevelde & Dierdonck, 2003

25

Belgian food products, textiles, machinery, chemical

and photographic material, electronics, motor vehicles,
railway locomotives, and plastic products companies

Droge et al., 2000

57

US suppliers to big car companies

McDonough, 2000

112

Consumer goods, services and B2B companies

Morgan Swink, 2000

136

US manufacturing industry

Tatikonda & Rosenthal, 2000

57

Firms making assembled products

Lynn, Skov, & Abel, 1999

95

High-tech

Terwiesch & Loch, 1999

102

Electronic firms

Kusunoki, Nonaka, & Nagata,

1998

200

Japanese system-based firms

Kusunoki et al., 1998

289

Japanese material-based firms

Griffin, 1997a

21

21 divisions of 11 firms

Hartley, Zirger, & Kamath,

1997

79

Assembled parts firms

Barnett & Clark, 1996

Manufacturer of advanced polymers

Zirger & Hartley, 1996

44

Electronic firms

K. M. Eisenhardt & Tabrizi,

1995

36

Computer firms

Cooper & Kleinschmidt, 1994

103

21 chemical firms

Beth, Jeffrey, & John, 1993

62

Medium-sized US general hospitals

Clark & Fujimoto, 1991

20

Auto firms

83

Chip firms

547

Firms in US and Canada

Schoonhoven,
Lyman, 1990

Eisenhardt,

Larson & Gobeli, 1989

&

34

In summary, the following insights and consequences for this research can be drawn:
New

Product

Development

concepts

are

widely

applied

and

their

implementation as well as supportive tools, methods, and techniques are

extensively described.
The superior performance of Integrated Product Development compared to NPD
was demonstrated in multiple empirical studies.
Cross-functional Teams is an organizational method enabling better integration
of production into the development process.
Through more intense involvement of production into the development process,
a more stable and efficient process is transferred from development to
production.
There are no established concepts of how to apply integrated development to the
pharmaceutical industry.

3 Development of a Reference Framework

In chapter 3 all aspects from literature reviewed in chapter 2 are put together and
transformed into a reference framework. First, the framework is introduced in general.
This is followed by detailed descriptions of all components as well as the effect on
performance.
The reference framework is used to guide all research relevant for this dissertation. The
following industry survey and case studies are based on this framework.

3.1 The Framework in General

Figure 12: Reference framework for integrated development.

Based on the findings in chapter 2, a simple and comprehensive reference framework

was derived (Figure 12). The framework is originally divided into three main
components: (1) deals with concurrent engineering as important method to speed up
development projects and consists of the three sub-components parallelization, crossfunctional teams, and tools & methods, (2) describes success factors that are crucial for
successful implementation and operation, and (3) defines the optimal organization for

36

Development of a Reference Framework

successful integrated development. They all have different characteristics and effects on
development performance. In combination they form an effective framework for
integrated development in the pharmaceutical industry. All topics are discussed in detail
in the next section.

3.2 Components in Detail

3.2.1 Concurrent Engineering
Concurrent engineering has proven to be a very effective method to shorten development
time and thus also time-to-market. This is achieved mainly by the parallelization of
different process steps and by using cross-functional teams in development.
Furthermore, concurrent engineering is supported by specific tools and methods.
Parallelization means doing development steps simultaneously instead of waiting for a
previous step to be finished before beginning a new one. This might result in additional
re-work and additional loops due to changes in specifications, but in total development
time decreases. Tools and Methods are used to structure and focus the work during the
development process. They are very useful in order to detect, eliminate, and prevent
errors in technical development.
Shorter development time would result in a longer time for patent protection of the
product (drug) and therefore would be commercially beneficial for pharmaceutical
companies. First evaluations showed that for the pharmaceutical industry the focus of
concurrent engineering lies on cross-functional teams, whereas both parallelization and
tools and methods are not considered further due to the following reasons:
Compared to other industries, companies in the pharmaceutical industry still are
an assembly of functions rather than a seamless integrated operation. Various
functions and departments co-exist but do not or only to a small extent
collaborate. This mainly applies to the pharmaceutical industrys central value
stream of research development production commercialization. Thus there
is an immense potential for work in cross-functional teams.
Todays development process is already parallelized to some degree (e.g. clinical
and technical development run in parallel). Due to regulatory requirements and a
very high attrition rate, further parallelization is not possible in the

Development of a Reference Framework

37

pharmaceutical industry. E.g. there would be no benefit in starting technical

development for commercial manufacturing before it is proved that the product
is safe and effective.
Parallelization can result in compliance issues with standard operations
procedures (SOP): often it is defined in SOPs that following activities can only
begin upon completion of current activities.
Tools & methods (e.g. quality function deployment QFD, design of experiment
DOE, failure model and effect analysis FMEA, design for six sigma DFSS,
benchmarking, design for X, brainstorming, computer-aided systems, fishbone
analysis, etc.) focus on technical improvements and are thus out of this works
scope (Yeh et al., 2008).
Described tools and methods are often used in practice in the pharmaceutical
industry. Therefore, there exists plenty of literature about the use of them (Yeh
et al., 2008).
This works focus is of conceptual rather than technical nature and on the level
of the overall set-up for managing integrated development.
Both topics are already widely covered in the literature (Yeh et al., 2008;
Kamrani and Vijayan, 2006; Terwiesch and Loch, 1999).
Therefore, concurrent engineering is recognized as a central concept of integrated
development for other industries; however, for the pharmaceutical industry it can be
reduced to cross-functional teams or cross-functional collaboration. Furthermore, the
focus of this work is on organizational and managerial rather than technical and
methodical aspects and thus parallelization and tools and methods are not considered
further.
3.2.1.1 Cross-Functional Collaboration
Cross-functional collaboration including the management, the composition, and the
behavioral aspects are one of the central aspects of integrated development. This
component is to a great extent influenced by both other components success factors
and organization, as they define the teams supportive environment.
The teams are composed of representatives of all major functions and departments
involved in development projects. At every process step they are under clear
management and responsibility. The team composition varies along the development

38

Development of a Reference Framework

process in order to represent the respective involvement and roles. However, it is crucial
to not only include those with direct contributions, but also those, whose interests
become requirements later in the process.
The team composition varies during the development process. Along a generic
development process, it is defined which organizational unit or function contributes to a
process step in what function, to what extent, and in collaboration with whom. Figure 13
shows a fictional idealized form of contribution and collaboration along the development
process. It is obvious, that contribution of early functions decrease over time while it
increases for late functions. However, in an ideal setting, most functions are to some
extent involved in all development steps.

Early Process
Final
Development
Formulation
(lab scale,
Development
feasibility)

Pilot Scale

Full Scale

Technology
Transfer

Validation

Registration

Launch

Post-Launch
Improvements/
Changes &
Maintenance

Early Stage
Development
Late Stage
Development
Transfer
Organization

Launch Site

Commercial
Production

Figure 13: Concept of optimal collaboration along the development process.

3.2.2 Success Factors

Success factors are further divided into three groups - context, enabling, and team
behavior factors (Figure 14) (McDonough, 2000). Context factors set the right
environment for integrated development (Table 4). Enabling factors facilitate context
factors and make them effective (Table 5). Both context and enabling factors are
organizational prerequisites; however, they do not encompass collaboration, which is

Development of a Reference Framework

39

covered by team behavior factors (Table 6). They describe how collaboration in teams
can be most effective.

Enabler
Top management support
Team leadership
Formal process
Clear roles & responsibilities
Resources / mix
Formal knowledge transfer process

Context
Shared, common, and unified goals
and vision, supported by senior
management
Organizational climate supportive
of (cross-functional) teams
Team co-location / proximity
Team reward

Team behavior
Commitment
Creativity
Communication / interaction
Trust & respect
Autonomy
Informal interpersonal
relationship / social cohesion
Cross-team coordination

Performance

Figure 14: Categorized success factors from literature, showing the interrelationship and the
effect on performance.

The following tables list all success factors as well as their detailed characteristics and
impact on performance as they are used in this reference framework (Table 4, Table 5,
Table 6).

Cross-functional collaboration ensures that

requirements further down the project path are
considered already at an early stage of the
project. Thus less re-work is required and no
useless loops occur during project execution.
Interactions are less formal and can be arranged
within short times. Upcoming issues can be
discussed directly without administration. This
speeds up project execution.

Organizational climate supportive of cross- Work in cross-functional teams is fostered by

functional teams
the organization and employees are heavily
encouraged to engage in cross-functional
activities. Additional resources needed for this
collaboration are readily provided.
Teams, in this case mainly development,
transfer, and manufacturing teams, are
physically co-located or at least in close
proximity. The results are short ways for
physical interaction and spontaneous meetings
and discussions.

Teams are rewarded for their performance as More team work and acting in the sense of the
team rather than as individuals. Furthermore, overall project outcome leads to better project
teams are rewarded according to overall project performance.
success.

Team co-location / proximity

Team reward

Impact on Performance
Actions and contributions are taken in a way
that the overall project benefits. Thus less rework is needed and project execution is sped
up.

Characteristics

Shared, common, and unified goals and vision, Overall goals are set for development projects.
supports by senior management
This ensures that all team members, even when
only contributing at certain phases, have not
only their own contributions success in mind,
but rather overall projects success.

Success Factor

40
Development of a Reference Framework

Table 4: Context success factors.

Capabilities and knowledge of different team

members complement each other and lead to
an optimal team performance.
Knowledge can be re-used without having to
be collected new for each project. All
knowledge contributors know how to make it
available and how to access it. This improves
knowledge build-up and thus project
execution.

Special efforts are put on providing good

team leadership. Responsible employees are
carefully selected and extensively trained.
The development process follows a clear
definition. Deviations of this path are not
allowed and project execution is very formal
rather than flexible and spontaneous. Ad-hoc
alterations are not supposed to occur.

Roles and responsibilities in projects are

defined and team members are informed.

Special efforts are invested in achieving a

beneficial mix of capabilities and knowledge
inside the team.
Knowledge is transferred in a formal and
clearly defined process between teams,
functions, and departments all working on
the same or on different projects.

Team leadership

Formal process

Clear roles & responsibilities

Resources / mix

Formal knowledge transfer process

Clear directives provide beneficial guidance

to project execution, which in turn prevents
discussions about single team members
parts.

Projects can be planned and executed very

accurately. Execution is not halted because
only very few ad-hoc decisions have to be
taken. The process is well known to all
participants and thus runs very smoothly.
However, in the case of unforeseen events,
alterations to the initial plan are a big deal
and ad-hoc decisions take longer.

As a result of good leadership projects are

executed more efficiently and faster.

Decisions are taken faster and resources are

provided readily. This has direct effect on
faster and more efficient project execution.

Senior management supports and empowers

teams in their effort to effectively contribute
to development projects. They also support
the idea of an integrated approach in general
and thus also provide additional resources
needed for successful and efficient project
execution.

Top / senior management support

Impact on Performance

Characteristics

Success Factor

Development of a Reference Framework

41

Table 5: Enabling success factors.

Characteristics
All team members are highly committed to
the team and its actions and decisions.
Team members are encouraged to work
creatively rather than following a
standardized and formal path.
Communication and interaction between
team members is occurring rather than
members work for themselves individually.
Furthermore, all team members are informed
of all actions taken in the team.
Team members trust and respect each other.

Qualified team members can take decisions

themselves. Only for major decisions and
alterations the teams supervising committee
is consulted.
Team members not only work together
formally but share informal and personal
relationships. Through social team events,
team members are more friends than mere
co-workers.
Actions, decisions, and knowledge is
coordinated and shared between different
teams. Exchange between teams is fostered
and encouraged, ideally even standardized in
an either formal or rather informal way,
depending on the companys general culture.

Success Factor

Commitment

Creativity

Communication / interaction

Trust & respect

Autonomy

Informal interpersonal relationship / social

cohesion

Cross-team coordination

Knowledge and leanings are shared which in

turn can reduce recurring work. Using a
knowledge base speeds up project execution.

Employees enjoy the team work and are thus

willing to perform better.

Projects are executed faster because

decisions are generally taken faster.
Performance of team members improves due
to the empowerment that they can take
decisions themselves.

There is an overall better climate in the team.

Team members feel comfortable working in
the team and can therefore perform better.

Through heavy interaction there is more

agreement on team actions and decisions.
Shared information helps prevent double
work.

Creative work leads to new concepts which

in turn can prove to be more efficient than
using established approaches and
technologies.

Less discussions and discrepancies occur and

thus team performance is not hindered.

Impact on Performance

42
Development of a Reference Framework

Table 6: Team behavior success factors.

Development of a Reference Framework

43

3.2.3 Organization
The organization in place during the development process has crucial influence on its
outcome. It mainly determines success and outcome of cross-functional collaboration.
Early and late stage development (responsible for process development) are both part of
the development organization. The responsible launch site belongs to production, but it
is separate from but affiliated with routine production. It maintains close connections
with development in order to exchange knowledge. Organizationally between
development and production is a so called Transfer Organization: it is a team or
organization mainly responsible for the transfer from development to production.
Compared to traditional launch sites, a Transfer Organization is part of production but is
not affiliated with routine production. Thus it is more closely connected to development.
During its time of involvement in the development process, the Transfer Organization
represents productions interest. Both the launch site and the Transfer Organization can
also be one combined function instead of two separated ones.

3.2.4 Effects on Performance

All components of the reference framework combined describe the ideal set-up for
successful integrated development. Integrated development is only better than the current
state if it has significant effects on performance. For this particular framework,
performance is measured by (1) the manufacturing process efficiency at launch, (2) the
amount of post-launch changes to the manufacturing process, (3) the transfer efficiency,
and (4) the launch efficiency. As a direct result of applying this framework, development
will be more efficient as well as effective and performance will increase.

4 Integrated Development in Practice

This chapter describes the empirical investigation that was undertaken in order to
evaluate the reference framework. First, it is described how the survey was set up and
how it was conducted. Second, the general results of the survey are outlined. Third, some
special aspects identified during the survey are explained. Finally, general findings and
insights are summarized.

4.1 Industry Survey: An Empirical Investigation

4.1.1 Industry Survey Questionnaire

Figure 15: Adapted reference framework used for the industry survey.

To assess the current state of integrated development and cross-functional collaboration,

an international industry survey was conducted in the first half of 2012. As mentioned in
chapter 1.3.3, this surveys scope was limited to drug product development. Data
generation was done with two questionnaires based on the previously described
framework. In total, they both based on the adapted reference framework (Figure 15) and
were divided into eight sections, which are further described in the following paragraphs.

46

Integrated Development in Practice

They only differ in the medium used: one was sent out as PDF document created with
TeleForm19 while the other was implemented in an online survey tool20. The PDF-based
questionnaire used for the survey is depicted in the appendix.
Section A: In this general section data about the participants company, function,
department, location, and work experience was gathered.
Section B: This section contained questions about the participants company: size
(number of employees), amount of employees in development and production (both
percentages), revenue and percentage of R&D expenditures for the years 2009, 2010,
and 2011, number of CMC development and manufacturing sites worldwide, and fields
it operates in (branded drugs / innovator, generics, OTC, biotech, or other).
Additionally, the average overall development costs and times were determined.
Section C: This section contained four questions about the perceived effect and benefit
of integrated development. Also, one question assessed the participants companys
degree of working in an integrated way during development projects.
Section D: This section contained questions about the organizational set-up of the
participants company or department: way of working in development teams,
organizational unit responsible for process development, existence and organizational
affiliation of a transfer group, existence and number of launch sites, existence and
organizational affiliation of launch groups, similarity of equipment at pilot and launch
sites, process development groups capability and equipment knowledge of first and
secondary manufacturing sites. Additionally, the composition of CMC teams was
determined.
Section E: It contained questions about tools used during development, mostly related to
QbD: to what extent a shared knowledge management solution, minimum QbD elements,
DoE, and PAT are used during pilot scale, full scale, technology transfer, launch, and
routine production. Further the reasons for minimum QbD, DoE, and PAT application
were requested.
Section F: This section consisted of a RACI-matrix in which the degree of involvement
of selected member groups of cross-functional teams along the previously described

19

Verity TeleForm Version 9.1, for more information visit http://www.cardiff.com/products/teleform/index.html

20

EFS Survey, for more information visit www.unipark.de

Integrated Development in Practice

47

pharmaceutical development process (Figure 21) was entered. Further elements assessed
include: a rating of the transfer between process steps, the duration of each process steps
(in months), the average amount of work hours for each process steps (for development
and production staff), the average amount of employees working on each process step
(for development and production staff). Also, it was asked when (clinical) POC, start of
clinical phase III, and final decision on first manufacturing site occurred. An additional
field allowed providing comments about the RACI-matrix.
Section G: In this section 13 statements, each representing one of the previously
described common success factors of cross-functional collaboration identified in
literature, were rated on a 5-point Likert-scale (from strongly disagree to strongly
agree). Additionally, there was an open text field to add further success factors;
however, it was not used by any of the participants.
Section H: The last section was about metrics. First, it was asked how many active
development projects currently were in certain clinical phases (clinical phase I, clinical
phase IIa, clinical phase IIb, clinical phase III, and launch). It was then rated whether
time, cost, and quality objectives of pilot scale development, full scale development,
technology transfer, product launch, and manufacturing process efficiency of all
products launched during the last five years were met. The rating was based on a 5-point
Likert-scale (objectives not met to objectives completely met). The second question
was about how many process adaptations and process changes (post-approval changes,
have to be filed at regulatory authorities) occurred on average if all products launched
during the last five years were considered. Again, a 5-point Likert-scale (none, very
few (1 in 10 launches), few (1 in 5 launches), some (1 in 3 launches), many (1 or
more in each launch)) was used for the rating. Also, it was asked whether there had
been an improvement regarding process development compared to ten years ago. It also
contained an open text field to enter any additional data, which, as expected, was used
only were rarely.

4.1.2 Industry Survey Data Sample

The questionnaire was sent out to more than 1,200 representatives of pharmaceutical,
biotech, generics, and chemical companies from all over the world. The representatives
were randomly identified via internet and business network searches and chosen due to

48

Integrated Development in Practice

their function either in Development, Production, Quality, or Regulatory departments.

However, representatives from the latter two departments did not feel adequate to
participate and thus there were much fewer potential participants. Each participant was
allowed a timeframe of two months to respond to the survey.
The response rate of roughly 3% is rather low. This can be attributed to the perceived
sensitive nature of some information asked for. As especially data about on-going
development projects is kept confidential, many contacted individuals decided not to
participate and thus not be conflicted with handing out confidential data. This issue was
known beforehand and addressed with great care and devotion: The survey was
completely anonymous and the questionnaire was designed in a way not to demand for
sensitive data as well as leaving the possibility to enter blank data. Yet, some questions
were still perceived to ask for semi- or full-sensitive data which drove many potential
participants to halt participation.
In total, there were 37 responses representing 29 companies. Out of all responses, 23
came from Development, 9 from Production, 0 from Regulatory, 2 from Quality, and 3
from others (Scale-up and Transfer, all of the above, and University Spin-Off)
(Figure 16). Participating companies were based in the following countries: Switzerland
(8), Germany (8), USA (10), Netherlands (2), India (2), Austria (2), Italy (2), Israel (1),
and n/a (2) (Figure 17). 12 participants are working for companies with less than 250
employees, whereas 11 participants are working for companies with more than 20,000
employees (Figure 18). Of all participants, 24 indicated to operate in the field of branded
drugs, 10 in generics, 9 to produce OTC (over-the-counter) drugs, 22 in biotech, and 7 in
other fields (Excipients, Vaccines, Cell therapy, Excipients for solid dosage
forms, Glass packaging, Agrochemical innovator, and R&D in support of NCEs,
Generic etc) (Figure 19). It is noteworthy that all participating companies were engaged
in R&D as well as manufacturing activities. The participants experience in the current
position ranged from less than one to over six years on average it amounted to four
years.

Integrated Development in Practice

49

others
8%
Quality
6%

Development
62%

Regulatory
0%
Production
24%

Figure 16: Overview of participants departments (n=37)

Austria
5%

Italy
5%

Israel
3%
India
5%

n/a
5%

Switzerland
22%
Germany
22%

Netherlands
6%

USA
27%

Figure 17: Overview of participants geographical locations (n=37)

up to 250
34%
over 20,000
32%
251-1,000
3%
5,001-20,000
14%

1,001-5,000
17%

Figure 18: Overview of participants company size (n=35)

other
10%

Branded Drugs /
Innovator
33%
Generics
14%

Biotech
31%

OTC
12%

Figure 19: Overview of participants company operating fields (n=35)

50

Integrated Development in Practice

>6 years
5-6 years
3-4
1-2 years
<1 year
0

10

12

14

Figure 20: Experience of participants in years (n=35)

The sample contained all different kinds of companies: from small, rather local up to
large international companies, as well as from highly specialized to very broadly
operating companies. Also in terms of geographical distribution, most major markets
(North America, Europe, and India) were represented. Additionally, there were
participants from different departments and functions (e.g. development, production,
etc.) and with different level of experience. All in all this sample is a good representation
of todays companies of the pharmaceutical industry and can therefore be used to derive
general statements about todays state of the industry regarding integrated development.

4.1.3 Measuring Performance

In literature on new or integrated product development, performance of investigated
processes, tools, and measures is usually assessed as the amount of successful
development projects, the market success of new products, or by comparing time and
cost of development projects (Cooper and Kleinschmidt, 1997; Griffin, 1997a).
However, since the focus of our research is not on overall development, but rather on the
development of commercial manufacturing processes, such a holistic view would distort
the effects of interest, as they would be conflated with other non-influenceable events
(e.g., low drug safety or efficacy). For this reason, a new indicator of performance was
required.
In discussion with experienced industry representatives, it was decided to assess whether
development stage objectives were met. For this, the relevant process development
stages were taken from the general pharmaceutical Drug Product development process
(Figure 21). The following process steps represent these development stages: pilot scale,
full scale, technology transfer, and launch. Additionally, it was decided to include the

Integrated Development in Practice

51

manufacturing process efficiency (in routine production). In order to get a more detailed
picture, these objectives were further divided into time, cost, and quality objectives and
assessed separately.

Early Process
Final
Development
Formulation
(lab scale,
Development
feasibility)

Pilot Scale

Full Scale

Technology
Transfer

Validation

Registration

Launch

Post-Launch
Improvements/
Changes &
Maintenance

Figure 21: The general pharmaceutical Drug Product development process

For each analyzed process step a general performance-index (PIi) was generated, as
shown in equation (1). It was decided to apply different weights to time (T), cost (C),
and quality (Q):
Quality standards are very high in pharmaceutical companies and have to be maintained
at such a level. Therefore, the industry is very well adapted to providing high quality.
The quality part of objectives was thus only weighed wQ=0.3.
Time is a very important factor in product development. However, timelines are
influenced by clinical development activities (e.g., clinical trials). Only in the case of
early clinical success, time also gains importance in technical development. Accordingly,
the time part of objectives was weighed wT=0.6.
Despite the fact that the main part of development costs is determined by clinical trials,
the industry is also very cost-sensitive when it comes to technical development. Costrelated objectives were mentioned to be the most important by all industry
representatives and therefore weighed wC=1.0.

)+( )+(
+
+

(1)

The performance-indices of all five process steps (PI1-5) were then combined into a
weighted average to get an overall performance-index (PItotal), as shown in equation (2).

52

Integrated Development in Practice

According to their importance and influence on overall performance, they were assigned
different weights:
Pilot scale as the first process step was considered to be the most important. In this step,
early foundations of future processes are determined and basic knowledge is gathered.
The more efforts at this stage are target-focused, the less effort is needed in later stages.
Thus, it was weighed w1=1.0.
The second and third process steps, full scale and technology transfer, are still important
especially regarding scale-up of the previously developed process. They both were
assigned a weight of w2=0.6 and w3=0.6.
The second to last step, launch, is considered to be less critical as it is fully based on
preceding efforts. It was thus weighed w4=0.2. This also applies to manufacturing
process efficiency, which resulted in a same weight w5=0.2.

(2)

Additionally, in order to measure the efficiency of launched manufacturing processes, it

was assessed how many process adaptations (PA) and changes (PC) occurred on average
during the first three years after launch. Process changes imply immense effort with
regulatory authorities, resulting in time loss and high costs, therefore these were weighed
wPC=0.6 in comparison to wPA=0.4 for process adaptations. The performance index PI
was still considered to be the most important and objective measure, and thus weighed
wPI=1.0. These three indicators were combined to form an indicator of overall
performance (P), as shown in equation (3). Thus, the overall performance (P) gives an
indication how successful technical development, and especially process development,
is.

)+(
+

)+(
+

(3)

Integrated Development in Practice

53

Table 7: Participants with the corresponding values of performance (P) (n=37)

P
Company J

0.76

Company J

0.75

Company Q

0.73

Company R

0.68

Company L

0.67

Company E

0.66

Company K

0.65

Company T

0.64

Company U

0.60

Company A

0.57

Company E

0.56

Company J

0.49

Company B

0.47

Company J

0.47

Company N

0.43

Company I

0.40

Company F

0.39

Company Q

0.30

Company Y

0.26

Company G

0.25

Company C

0.00

Company D

0.00

Company H

0.00

Company H

0.00

Company M

0.00

Company O

0.00

Company P

0.00

Company S

0.00

Company O

0.00

Company K

0.00

Company V

0.00

Company W

0.00

Company X

0.00

Company Z

0.00

Company AA

0.00

Company AB

0.00

Company AC

0.00

54

Integrated Development in Practice

The overall performance (P) is a value between 0 and 1, with higher numbers indicating
a better overall performance.
From all 37 participants, only 20 had provided enough data to reliably calculate
performance (listed in Table 7
Participants with an overall performance of higher than 0.66 are considered to be high
performers. This leads to a high performer quota of 25%. Companies with multiple
participants are not grouped, but treated individually. Interestingly, the 5 high performers
were formed by 4 companies.
The overall performance (P) gives an indication how successful technical development,
especially process development, is.

4.1.4 Measuring Integration

For all participants, a corresponding value of integration (I) was calculated. This
indicator represents the degree of cross-functionality within development projects on the
one hand, and the degree of implementation and application of principles of integrated
development described earlier on the other hand.
It was assessed how integrated participants rated their own development (ID) as well as
whether they work in cross-functional teams (CF). These two values were then combined
into a weighted average, as shown in equation (4). The self-assessment of the own
development was weighted wID=1, whereas the degree of work in cross-functional teams
was weighted wCF=0.3. This was mainly due to the fact that work in cross-functional
teams is only one part of integrated development concepts, and thus of less influence. It
has to be noted that both values used are solely based on self-assessments participants
and therefore reflect a subjective perception.

)+(
+

(4)

Integrated Development in Practice

55

Table 8 shows high performers and their corresponding values of integration. The values
are all between high (0.8) and very high (1). Thus it can be concluded that high
perceived integration is closely associated with high process development performance.

Table 8: High performing participants with the corresponding value of integration (n=5)
P

Company J

0.76

1.00

Company J

0.75

0.85

Company Q

0.73

0.80

Company R

0.68

0.97

Company L

0.67

0.93

The identified correlation of high performance and high integration is confirmed by a

correlation analysis. Pearsons correlation coefficient of both variables is =0.75 (Table
9). Since there are 20 valid participants, the degree of freedom is df=18 (df=n-2). This
leads to a critical correlation coefficient crit=0.679 for an alpha level of p=0.01. This
means that the identified relationship in the sample reflects a relationship in the whole
population he sample was taken from. Only in 1 out of 100 cases the identified
relationship in the sample is incorrect for the population. Because of this statistical
relevance, the Pearson correlation analysis shows a highly significant correlation
between performance and integration. A linear regression also shows a clear correlation
of both variables (Figure 22).

Table 9: Correlation matrix for performance and integration (n=20)

Performance
Performance
Integration
* p < 0.01

Integration

1
0.75*

56

Integrated Development in Practice

1.00

Integration (I)

0.90
0.80
y = 0.7652x + 0.4137
R = 0.566

0.70
0.60
0.50
0.40
0.30
0.00

0.20

0.40
0.60
Performance (P)

0.80

1.00

Figure 22: Linear regression of performance and integration (n=20)

4.2 Special Aspects

4.2.1 General Findings about the Pharmaceutical Industry
The international industry survey was also used to gather general information about the
current state of the pharmaceutical industry. On average, around 31.5% of all employees
of pharmaceutical companies work in development and 30.2% in production (Figure 23).
The remaining 38.3% belong to Marketing, Regulatory, Quality (although both
Development and Production already contain a fair share of quality employees), and
supporting areas such as legal, IT, infrastructure, etc. Expenditures for R&D have
slightly increased from around 29 to 31.6% (Figure 24). This is caused by ever
increasing efforts to find new drugs.
There is a clear difference when comparing innovative or R&D intensive companies with
companies operating in the fields of generic and OTC products: the R&D expenditures
are clearly over 30% for the first group, whereas the latters R&D expenditures are
around 17% (Figure 25). Regardless of their amount, in general for both groups the
expenditures remained similar with a light increase over the last three years.

Integrated Development in Practice

57

38.3%

100%

75%

30.2%

Rest
50%

Production
Development

31.5%

25%

0%

Figure 23: Average distribution of employees (n=24)

68.4%

72.0%

75%

71.0%

100%

other expenditures

50%

28.0%

31.6%

25%

29.0%

R&D expenditures

2009

2010

2011

0%

Figure 24: Average R&D expenditures in 209, 2010, and 2011 (n=15 for 2009, n=18 for 2010,
n=14 for 2011)

2009

2010

83.5%

64.2%

Generics/OTC 16.5%

35.8%

other expenditures

Innovators

82.0%

70.2%

Generics/OTC 18.1%

Innovators

0%

29.8%

Generics/OTC 17.7%

25%

32.5%

50%

Innovators

82.3%

75%

67.5%

100%

R&D expenditures

2011

Figure 25: Average R&D expenditures in 2009, 2010, and 2011 comparison of innovators
(branded drugs & biotech) vs. generics/OTC (n=10 for innovators in 2009, n=13 for innovators
in 2010, n=9 for innovators in 2011, n=3 for generics/OTC in 2009, n=4 for generics/OTC in
2010, n=2 for generics/OTC in 2011)

58

Integrated Development in Practice

When comparing all participants, the average development costs between USD 300 Mio
and USD 900 Mio, the major part (36%) of all participants even indicated development
costs of under USD 300 Mio. Development of a product takes around 8-10 years or
slightly less (Figure 26). However, taking into account that research and development
efforts are much greater for innovators, the costs increase substantially: For R&D
intensive companies the average development costs are between USD 900 Mio and USD
1,200 Mio or higher (Figure 27). Unexpectedly, the development time does not differ
significantly (Figure 27). Most likely this is due to the fact that most development
projects have to move through the clinical development phases which take a similar
amount whether there were prior massive timely investments or not. Additionally, it is
believed that most participants rather considered development duration and neglected the
preceding research efforts.

a)

>1,200
Mio
14%

900-1,200
Mio
29%

<300 Mio
36%

b)

300-599
Mio
14%

<5 years
11%

5-7 years
26%

>12 years
0%

600-899
Mio
7%

11-12 years
21%

8-10 years
42%

Figure 26: Average development costs (a) and times (b) (n=29 for (a), n=27 for (b))

a)
>1,200
Mio
17%
900-1,200
Mio
33%

<300 Mio
25%
300-599
Mio
17%
600-899
Mio
8%

b)

<5 years
6%

>12 years
0%
11-12 years
19%

5-7 years
31%

8-10 years
44%

Figure 27: Average development costs (a) and times (b) of innovators (branded drugs &
biotech) (n=24 for (a), n=22 for (b))

In total, the average duration of technical development is 81.3 months. This is most
likely influenced by clinical development. The numbers below the process steps indicate
the average duration in months (Figure 28). However, since individual process steps can
run in parallel, this total number is not an absolute duration but rather representing the

Integrated Development in Practice

59

resource effort. Almost half of all participants (45%) reach (clinical) POC during pilot
scale development and consequently clinical phase III follows directly and starts during
full scale development (Figure 28). This allows that products from that phase can be
used to supply the clinical study and do not go to waste. Over 60% of all companies
decide about the first manufacturing site right before full scale development starts and
can thus already consider the equipment of commercial scale production and coordinate
the set-up (Figure 28). The arrows indicate that the respective event occurs at other
process steps in some countries.

Figure 28: Duration of single process steps and indication of occurrence of selected milestones
(n=13 for process step duration, n=21 for occurences)

4.2.2 Integrated Development in the Pharmaceutical Industry

Throughout the industry, integrated development is considered to have very positive
effects on development (Figure 29): no participant rated its impact negative, and only
very few considered it to be neutral. Although integrated developments impact is
considered throughout positive, there are differences between different development
stages. More than 75% of participants rated integrated development positively,
especially for full scale development and technology transfer. These are the steps that
involve the most different functions and departments and particularly combine
Development and Production. It is obvious that Production involvement during full scale

60

Integrated Development in Practice

development helps to develop large scale processes that are already partly adjusted to the
equipment and set-up of the first manufacturing site.

Pilot Scale

18%

Full Scale

21%

35%

44%

negative

79%

rather negative
neutral
Technology Transfer 3%9% 12%

76%

rather positive
positive

Launch 4% 14%
0%

20%

29%
40%

54%
60%

80%

100%

Figure 29: Rating of the effect of integrated development on the performance of different
development stages (n=33)

Of all participants, 58% rate their development to be rather fully integrated and 18%
state it to be fully integrated (Figure 30). Thus, most participants consider their
development to be rather fully integrated. This concurs with the fact that most
participants work in cross-functional teams (Figure 31). ). This indicator is even higher,
which means that development projects are indeed mostly carried out in cross-functional
teams. However, personal ratings usually exceed the actual state. Although this value is
high, there is a lot of improvement potential with regards to existing concepts of
integrated development in the pharmaceutical industry.

Participants' Development 6% 18%

0%

20%

58%
40%

60%

18%
80%

100%

not integrated
rather not integrated
partially integrated
rather fully integrated
fully integrated

Figure 30:Degree of integration of participants development (n=33)

Integrated Development in Practice

"We work in crossfunctional teams"

3%10%
0%

20%

61

27%

57%
40%

60%

80%

100%

strongly disagree
rather disagree
medium agreement
rather agree
strongly agree

Figure 31: Degree of working in cross-functional teams (n=30)

4.2.3 Organizational Set-Up

Figure 32 gives an overview of different ways of working in development teams. The
most common form (35%) of cross-functional collaboration in development projects is a
set-up where a project leader or process owner leads and coordinates cross-functional
teams through the different process stages and handles communication up- and
downwards. Also very common (26%) is a similar set-up where the coordinator between
the cross-functional team and the responsible and decision taking management is
missing. This form is less seamless but more task- and development stage-oriented and
management reviews results at the end of each stage. 18% of the companies have an
overlapping system in place: parallel activities, seamless transitions and conditional
stage decisions are top characteristics. Another 18% have no formalized process, but still
a clearly defined path and activities. Only 3% work in a very isolated way where one
team completes a task and hands over the results as well as involvement and
responsibility.

"We have a formalized process where a

cross-functional team uses a staged
process with overlapping, fluid stages
and "fuzzy" or conditional stage
decisions"
18%

"While no formalized process is

followed, we have clearly understood
path of the tasks to be completed in
development"
18%
"We have a formalized process where
one function completes a set of tasks,
then passes the results on to the next
function which completes another set of
tasks"
3%

"We have a formalized process where a

facilitating "process owner" helps crossfunctional team move through stages and
management reviews"
35%

"We have a formalized process where a

cross-functional team completes a set of
tasks, management reviews the result and
gives the go-ahead for the team to
complete the next set of cross-functional
tasks"
26%

Figure 32: Overview of ways of working in development teams (n=34)

62

Integrated Development in Practice

In the overwhelming majority of companies (91%), Development rather than Production

is responsible for process development (Figure 33). Although process development
should be very close to commercial Production, it is clearly separated and still a
development task, mainly because during process development one has to deal with
many uncertainties and changing conditions. In more than half of all participating
companies, even the group responsible for the following step, technology transfer, is
under Development responsibility (Figure 34). However, in 27% this group is
organizationally part of Production. In total, 85% of all participants do have a group
responsible for facilitating transfer from Development to routine Production.

Production
9%

Development
91%

Figure 33: Distribution of organizational responsibility for process development (n=32)

no such group
15%
own organizational
unit
6%

Development
50%

Production
29%

Figure 34: Distribution of organizational affiliation of the transfer group (n=34)

Surprisingly, only little more than one-third (39%) of all participating companies do
possess designated launch sites (Figure 35). On average, there are 2.8 launch sites per
company, with a maximum number of ten different launch sites for one of the
participating companies (Figure 36).

Integrated Development in Practice

63

No Launch Sites
61%

Launch Sites
39%

Figure 35: Existence of launch sites in participants company (n=33)

12
10
8
6
4

2.75

2
0
Launch Sites

Figure 36: Average and maximum number of launch sites (n=12)

Over 60% of all participants have designated teams for the launch of new products in
place, while only a small number of companies do not (Figure 37). Over 50% of these
launch teams are not directly reporting to routine Production at the first manufacturing or
launch site (Figure 38). This means that launch teams are rather site-independent, maybe
associated with or located at specific sites, but not reporting to it. It is also possible that
they are identical with the transfer group and are thus, as seen in Figure 33,
organizationally part of and also reporting to Development.

Designated Launch Teams 10%10% 19%

0%

20%

29%
40%

60%

32%
80%

100%

not at all
rather not
somehow
rather
completely

Figure 37: Degree of existence of designated launch teams (n=33)

64

Integrated Development in Practice

Direct Reporting to
Routine/Commercial Production

20%
0%

33%
20%

40%

17% 13% 17%

60%

80%

100%

not at all
rather not
somehow
rather
completely

Figure 38: Extent of direct reporting to routine/commercial Production by launch teams (n=33)

In general, transfer from one development step to the following and associated with
this often also transfer from one specific cross-functional team composition to another
is considered to be problem-free (Figure 39). The more groups are involved, the less
smooth a transfer at interfaces will be, and the more problems will occur. On average,
smoothness of transfer at interfaces is the lowest before and during technology transfer.
This is mainly due to the fact that different organizations have to collaborate closely.
Employees in these different organizations, especially Development and Production,
have different ways of thinking and approaching problems (more freely and creatively in
development vs. more structured and process-oriented in production). This cultural
difference, often combined with varying expectations, makes transfers at these interfaces
most difficult. Especially in the end, in the time after validation up to launch, transfer is
mainly within Production and therefore smooth.

Early Process Development 5%

Final Formulation Development

47%

Final Formulation Development 6%

Pilot Scale

47%

50%

Pilot Scale Full Scale

44%

71%

Full Scale 10%

Technology Transfer

29%

30%

60%

many problems
some problems

Technology Transfer Validation

13%

Validation 5%
Registration
Registration Launch
Launch Post-Launch Improvements/
Changes & Maintenance

40%

14%

no problems, smooth

55%

27%

0%

39%

48%

73%

29%
20%

57%
40%

60%

80%

100%

Figure 39: Smoothness of transfer at interfaces during the development process (n=21)

Integrated Development in Practice

65

4.2.4 Cross-Functional Collaboration

From all high performing participants (determined in chapter 4.1.3) the RACI-matrix of
involvement was analyzed. Only values that showed conformity between at least 3 of all
5 high performers were considered. This guarantees that no outliers biased the general
process model. Figure 40 shows how high performing companies handle cross-functional

Early Stage Development

Late Stage Development
Transfer Organization
Receiving / First Manufacturing / Launch Site
Regulatory
Marketing
QA

100%
I

55%
45%

C
C

I
100%
I
C

La
un
c

gi
str
at
io
n
Re

h
Po
stCh Lau
an nch
ge
s & Imp
M rov
ai em
nt
en ent
an s /
ce

fe
r

43%
28%
28%
C

al
id
at
io
n

Tr
an
s

I
62%
C
38%
C

hn
ol
og
y
Te
c

Ea
rly
(la P ro
b
sc cess
Fi al e, De
na
v
f
l F eas elo
i
p
D orm bili me
ev u
t
el lat y) nt
op io
m n
Pi
en
lo
t
tS
ca
le
Fu
ll
Sc
al
e

process development.

38%

29%

52%
C
I
10%

C
60%

100%
C

11%

100%
C
C
C

Figure 40: Model of cross-functional collaboration (involvement and responsibility) during late
stage technical development

The percentages represent the amount of work done by the participant in the left column
during the process step in the top row. Cells with dashed boxes indicate responsibility
and leadership for the process step. Cells with I indicate that this participant is kept
informed during the process step; whereas C means that the participant is actively
consulted and thus slightly more involved.
Due to its non-technical nature, the process step Registration was not further
considered; it is mostly regulatory-driven and therefore not influenceable by the
company in a meaningful way.
It was obvious that in companies with the highest early manufacturing process
performance (P) the involvement of the main future customer the receiving/first
manufacturing or simply launch site started earlier during process development than in
lower performing companies (Figure 22, Figure 40). Also, the extent of cross-functional
collaboration was greater, meaning the different functions (mainly Development and
Production) are actually collaborating and finding solutions together.

66

Integrated Development in Practice

As expected, the analysis showed that mass work load, and with it responsibility,
switched from Development to Production around the technology transfer step.
However, the true lead switched just after the technology transfer, after the process has
physically left development facilities and entered launch and commercial production
plants.

4.2.5 Success Factors

Prior to the industry survey the topic itself, the reference framework used, and the
questionnaire were discussed with representatives from the pharmaceutical industry with
many years of experience in cross-functional projects. Based on these discussions, not all
success factors mentioned in the reference framework were further tested in the
international survey. Namely team reward, resources / mix, commitment,
communication / interaction, trust & respect, and informal interpersonal
relationship / social cohesion were omitted either due to according to industry experts
negligible impact or because their effect was already integrated in other parts of this
research (e.g. interaction is integrated in cross-functional collaboration itself).
The remaining success factors proved to be important and beneficial for cross-functional
team success. As the majority of earlier studies focused on very few industries (e.g.,
electronics, automotive), success factors were tested for their relevance in the
pharmaceutical industry. Table 10 shows by how many participants they were mentioned
to be beneficial for success of cross-functional collaboration.
In general, only selected success factors of each group were considered to be important.
Of great influence, and widely implemented in the pharmaceutical industry are mainly
contextual, enabling, and technical success (Figure 41, Figure 42, Figure 44). Team
behavior factors seem to be less important (Figure 43).

Integrated Development in Practice

67

Team behavior
factors

Technical factors

Common goals and visions

70%

72%

80%

70%

Organizational culture fostering crossfunctional collaboration

63%

68%

80%

60%

Co-location of team members

37%

47%

20%

35%

Strong top management support

70%

70%

20%

50%

Selection and education of team leaders

53%

63%

40%

50%

Formal process

30%

49%

40%

55%

Clear roles and responsibilities

80%

73%

60%

65%

Encouragement to work creatively

70%

69%

40%

60%

Team autonomy

40%

56%

40%

55%

Cross-team coordination

50%

57%

40%

45%

Formal process for (forward)

knowledge transfer

33%

50%

0%

40%

Formal process for (backward)

knowledge transfer

15%

41%

20%

30%

Equipment representing first

manufacturing site

44%

60%

60%

65%

Knowledge of launch/first
manufacturing site capabilities and
equipment

73%

75%

80%

85%

Knowledge of secondary
manufacturing site capabilities and
equipment

52%

64%

25%

65%

High performers
average

High performers

Enabling factors

Industry average

Context factors

All participants

Table 10: Positive perception of success factors of all and of high performing participants
(n=30 for all participants, n=5 for high performers)

68

Integrated Development in Practice

70%

Common Goals and Visions

80%

Organizational Culture Fostering

Cross-Functional Collaboration

63%

All participants

80%

High performers

37%

Co-Location of Team Members

20%
0%

20%

40%

60%

80%

100%

Figure 41: Positive perception of contextual success factors (n=30 for all participants, n=5 for
high performers)

70%

Strong Top Management Support

20%

Selection and Education

of Team Leaders

53%
40%

All participants

30%

Formal Process

High performers
40%
80%

Clear Roles and Responsibilities

60%
0%

20%

40%

60%

80%

100%

Figure 42: Positive perception of enabling success factors (n=30 for all participants, n=5 for
high performers)

Encouragement to
Work Creatively

70%
40%
40%
40%

Team Autonomy

50%

Cross-Team Coordination
Formal Process for (Forward)
Knowledge Transfer
Formal Process for (Backward)
Knowledge Transfer

All participants

40%

High performers

33%
0%
15%
20%
0%

20%

40%

60%

80%

100%

Figure 43: Positive perception of team behavior success factors (n=30 for all participants, n=5
for high performers)

Integrated Development in Practice

Development Equipment
Representing Equipment
at First Manufacturing Site

69

44%
60%

Knowledge about Capabilities

and Equipment at Launch /
First Manufacturing Sites

73%
80%

Knowledge about Capabilities

and Equipment at Secondary
Manufacturing Sites

All participants
High performers

52%
25%
0%

20%

40%

60%

80%

100%

Figure 44: Positive perception of technical success factors (n=30 for all participants, n=5 for
high performers)

Common goals and visions, organizational climate supporting cross-functional teams,

and clear roles and responsibilities proved to be the most important success factors
across all and high performing participants. High performers rate the former two factors
even higher than the average.
Top management support is found to be important, though its effect is not crucial for
high performance. The same applies to creativity. Both top management support and
creativity are mentioned with a below-average frequency by top performers.
Interestingly, team co-location is rated very low across all participants, and even below
average by top performers. This corresponds to the fact that most companies operate
internationally, and often have separate sites for development and for (first)
manufacturing. Thus, ways to bypass this distance seem to have been found.
High performing companies have a higher degree of similarity of equipment in pilot and
commercial manufacturing plants. This of course facilitates development of processes
tailored to the future commercial environment. Knowledge of capabilities of launch/first
manufacturing site is a tremendous advantage for similar reasons, and therefore widely
spread across the industry. Secondary manufacturing site capabilities knowledge is less
important during development, especially for high performing companies.
During the first development steps up to product launch, almost half of all companies
have shared knowledge management solutions in place (Figure 45). Such platforms help

70

Integrated Development in Practice

to make knowledge available to everyone involved, independent of when or by whom it

has been originally acquired. By this, prior knowledge can be re-used and certain
development steps shortened by avoiding replication of effort. Interestingly, only one of
the high performing companies has such a solution in use.

47%

Pilot Scale

20%
55%

Full Scale

20%
55%

Technology Transfer
Launch

All participants

20%

High performers
48%

0%
32%
25%

Routine Production
0%

20%

40%

60%

80%

100%

Figure 45: Knowledge management solution in different development stages (n=30 for all
participants, n=5 for high performers)

Excursus: Quality by Design in Industry

The survey was also used to assess the status of QbD implementation in the industry.
Therefore, QbD was split into minimum QbD elements (minimum requirements, basic
scientific approach), DoE, and PAT. Both DoE and PAT are enhanced QbD elements,
meaning that their implementation and usage is part of a full QbD implementation. From
this data it is to some extent possible to identify the participants current status in QbD
implementation, as most companies chose to first implement minimum QbD
requirements to build up a general base and then move on with the implementation of
enhanced QbD elements. Companies that only use enhanced QbD elements usually do
not follow the QbD approach as it is proposed by regulatory authorities, but rather us
these elements for their own science-based gathering of process knowledge and
understanding.

Integrated Development in Practice

71

Minimum QbD elements are used throughout all development steps (Figure 46). It is
most often used during pilot scale development. However, even at routine production
over one-third of all participants use minimum QbD elements. As expected, this is more
spread than specific enhanced QbD elements such as DoE and PAT. DoE is used
extensively (over 60% of all participants) applied during pilot scale development, usage
then goes back especially during full scale development and technology transfer (Figure
47). PAT is even used fewer: around one third uses this enhanced QbD element during
early development steps, usage then decreases during launch and routine production
(Figure 48). This is somehow unexpected since PAT could ease launch and routine
production by eliminating delaying IPCs (in-process-control) and allowing real-time
releases. However, it would in turn require to be registered with regulatory authorities
exactly this way and could thus only be produced at sites with the PAT capabilities, i.e.
equipment and set-up. The following figures indicate how many of all and of top
performing participants only have mentioned the elements to be beneficial for success of
cross-functional collaboration.

53%

Pilot Scale

40%
45%
40%

Full Scale

52%
60%

Technology Transfer

All participants
High performers

41%

Launch

25%
33%
33%

Routine Production
0%

20%

40%

60%

80%

100%

Figure 46: Application of minimum QbD elements during selected development stages (n=30
for all participants, n=5 for high performers)

72

Integrated Development in Practice

66%
60%

Pilot Scale
42%

Full Scale

20%
35%

Technology Transfer

Launch

Routine Production

All participants

20%

High performers

26%
0%
14%
0%
0%

20%

40%

60%

80%

100%

Figure 47: Application of DoE during selected development stages (n=30 for all participants,
n=5 for high performers)

35%

Pilot Scale

60%
34%

Full Scale

60%
33%

Technology Transfer

Launch

Routine Production

All participants
60%

High performers

26%
0%
21%
0%
0%

20%

40%

60%

80%

100%

Figure 48: Application of PAT during selected development stages (n=30 for all participants,
n=5 for high performers)

Very few companies deliberately refuse to use QbD elements such as minimum elements
or DoE (Figure 49). They are valuable during development to gain more knowledge in a
systematic way. PAT has the lowest value to development, its use is rather intended for
routine production to decrease losses and delays due to quality issues, and is thus refused
by more companies (30%). The most prominent reason to use either minimum or
enhanced QbD elements is to pursue a scientific approach (Figure 49). QbD elements
and especially DoE is used to generate knowledge and to gain process understanding. As
previously seen (Figure 47), this is mainly of interest during early development steps.

Integrated Development in Practice

73

Over 50% use especially minimum QbD elements because of regulatory requirements
(Figure 49). More and more regulatory bodies do expected such minimum elements,
such as e.g. design space, to be included in registrations. Between one third and half of
all participants include minimum QbD elements or DoE in their registration documents,
PAT is only included by around one quarter (Figure 49). These numbers are rather low
but do reflect the companies desire to be flexible then it comes to transferring products
from high tech (e.g. with PAT-capable equipment) to low tech sites.

100%
79%

80%

68%
60%
50%

50%
44%
38%

40%

DoE
26%

20%

minimum QbD

18%
18%

21%
18%

26%

21%
15%

PAT

9%
3%
0% 0%

0%
Top
Meet
Scientific
Management Regulatory Approach
Decision Requirements

Regulatory
Relief /
Operational
Flexibility

others

Included in
Registration
Documents

Figure 49: Reasons for practicing minimum QbD, DoE, and PAT.

4.3 Insights from Current Industry Practices

In general, the industry has already adapted some concepts of integrated development
known from literature and other industries. However, the characteristics are not yet fully
developed and there still is a lot of potential to be harvested.
The following are the main reasons for that:
Inconsistent implementation: Many approaches found in todays practices are
not consistent and continuous. They are missing complete systems and are
mostly not based on holistic and integrated concepts.

74

Integrated Development in Practice

Too much loss of information and knowledge at interfaces: Transfer from one to
another group within cross-functional teams or changes of cross-functional team
compositions at hand-over points are the main source of information loss due to
unclear hand-over guidelines. In other cases guidelines might be suitable but are
not followed.
Cultural differences at interfaces: During changes of responsibility at interfaces
different cultures clash. Different groups have different ways of thinking,
working, and problem solving. This is mainly the case for inter-departmental
interfaces (e.g. Development and Production) and to a lesser extent also for
intra-departmental interfaces (e.g. formulation development and process
development).
Only few success factors proposed by literature appear to be important in the
context of pharmaceutical technical development.
Technical success factors are not found in the literature; however, they proved to
be very important in this study. Especially the knowledge about first
manufacturing sites capabilities and equipment seems crucial for successful
transfers.
Nonexistent knowledge exchange: Especially knowledge gained later during the
development process is not exchanged backward and thus might not be available
in future development projects. This way the same errors may occur repeatedly
and no general knowledge base is built up.
Nonexistent holistic knowledge management solutions: Often knowledge
management solutions are in place, but they are not based on a holistic system.
Each group or department has its own IT-based system and compatibility as well
as data-exchange are limited.
QbD application is still not established: Many companies more and more start to
implement QbD elements. However, these efforts are still small compared to the
potential benefits originating from a complete QbD supported science-based
approach to development and also routine production.

5 Successful Approaches to Integrated Development

This chapter introduces two practical approaches to integrated development in the form
of two case studies. First, case study selection and concept are described. This is
followed by the actual two case studies. The chapter is concluded by a comparison of the
two case studies, a comparison with literature, and insights from case study research.

5.1 Selection of the Case Study Companies

Based on a broad and representative sample of pharmaceutical companies, the industry
survey analysis led to first insights into integrated development in general and into
success factors and performance measurement in particular. The survey results provide a
clear and comprehensible answer to the question How can efficiency of newly
introduced production processes be measured (operationalized)? However, the question
Can selected approaches from other industries be applied to the pharmaceutical industry
(e.g. cross-functional teams)? can only be answered in terms of identification of
relevant success factors. It is not answered how the development process is to be shaped
to adopt integrated development. The latter can be answered by the case study research
presented in the following sub-chapters. The ultimate objective is to identify how to
shape and manage integrated development in the pharmaceutical industry.
In a pre-screening phase telephone interviews were conducted with various technical
development leaders from the pharmaceutical industry. After assessment of their current
situation, two companies were selected for participation in a profound analysis in the
form of a research collaboration.
For detailed and in-depth investigations of the two selected companies, at least three onsite workshops (in total three or more days) were conducted. The process was to first
discuss the companies development process in general and then assess technical
development in more detail. Focus thereby was on late stage development, technology
transfer, and subsequent activities (such as validation, registration, launch, and postlaunch improvements) within the scope of drug product development. At both companies
most workshop participants were from Late Stage Development, however, there were

76

Successful Approaches to Integrated Development

also other stakeholders present, e.g. members from Early Stage Development and
Transfer Organization. Additional to the workshops an internal survey was conducted at
each company. This was mainly to assess cross-functional collaboration during technical
development: which functions are involved to what extent during which development
step. The analyzed development process and contributing functions were more detailed
and company-specific than in the general industry survey. These company-specific
surveys were conducted internally to also analyze other functions perception of
technical development. The surveys at both companies had supplemental companyspecific questions about their current perceived situation in technical development and
about on-going improvement initiatives. They are not presented in detail; however, the
results are integrated in the cases.

5.2 Conception of the Case Studies

Both case study companies have implemented a highly sophisticated approach to
integrated development. The data generation was guided by the reference framework
derived from literature. Integrated development and the management thereof is the unit
of analysis for the qualitative case study research.
The research aims at providing guidance with a generic concept for integrated
development in the pharmaceutical industry. Therefore the companies were selected to
share certain similarities as well as differences. This concerns both overall characteristics
as well as specifics of the companys individual approach. In order to guarantee the
utmost possible confidentiality, the companies are simply called Pharmaco121 and
Pharmaco2. Furthermore, specific products, product families, or therapeutic areas will
not be revealed. Also, exact locations and groups, functions, or the true names of
departments will not be mentioned. Generalizations are used instead.
Both case studies are structured in five sections:
1.

Company: in this section the companys field of operation and markets, its plant
network, general organization, and products are described.

21

The term Pharmaco is simply derived from pharmaceutical company.

Successful Approaches to Integrated Development

2.

77

Development process: this section provides an overview of the companys

general development process with focus on technical development. Meetings,
development phases, and milestones are explained.

3.

Organizational set-up: this section presents the companys organizational set-up,

e.g. functions, teams, and groups and where they are organizationally affiliated.
Relevant teams and their compositions are described.

4.

Cross-functional collaboration: in this section the management of crossfunctional activities is described in more detail. Changing team compositions
and involvements along the development process are introduced.

5.

Potential for further improvement: this section discusses identified potential for
further improvement of the current approach.

The first case study has two additional sections: (1) improvement initiatives describes
on-going or past initiatives undertaken to improve the process itself and collaboration in
technical development and (2) QbD in practice.

5.3 Case Pharmaco1

5.3.1 The Company
Pharmaco1 is a global company focusing on human pharmaceuticals and animal health.
It was founded over 100 years ago with the purpose of fabricating chemical and
pharmaceutical compounds. The company is family-owned and has its headquarter in
Europe. In total, Pharmaco1 has more than 40,000 employees at over 145 sites or
affiliated companies worldwide. About 17% of all employees work in R&D, whereas
almost 30% work in Production.
There are three main focus areas at Pahrmaco1: Prescription medicines, consumer health
care, and animal health. Prescription medicines is the biggest area and generates by far
the most revenue, however, consumer health care is growing rapidly.
Pharmaco1 covers a broad range of research areas. There are seven research centers in
Europe, the Americas, and Asia. Each of these centers focuses on specific research areas
and disease groups. Pharmaco1 maintains intensive research collaboration with academia
at one of its European research centers.

78

Successful Approaches to Integrated Development

Development activities are split in two: Early development activities are undertaken at
the companys research centers across Europe, the Americas, and Asia. Each of these
locations has specific areas of expertise and focus in their development portfolio, mainly
aligned with the research centers respective focus areas. Late development activities are
bundled and concentrated in the companys main development site near headquarter.
This split also reflects the collaboration needed for early and late development activities:
During early phases, mainly interaction with research is needed, whereas during late
phases, information exchange primarily happens with commercial Production.
Pharmaco1 has two designated launch sites used for introducing new products in either
the European or the American market. After successful launch, the launch sites produce
for the worldwide demand. Products can at a later stage be transferred to other, usually
technologically less sophisticated secondary manufacturing sites. Pharmaco1 is present
with manufacturing activities at 20 sites in 13 countries.
Technical development, including all development activities except clinical and medical
activities and spanning early and late stage development as well as technology transfer
and pre-launch activities, is, in comparison to other companies from the pharmaceutical
industry, further advanced than the average state-of-the-art. The systems currently in
place, namely their approach to seamless transfers, harmonization, and other
improvement initiatives, mark a desirable state for many companies. Internally, they are
perceived to be beneficial and are thus widely accepted among all involved employees.
However, in the sense of continuous improvement, the available approaches should be
kept up-to-date to reflect the ever changing circumstances.
With late development activities in focus, it can be said that the defined process is
working and established in practice. An internal survey has shown that all participants
rate Late Stage Developments performance to be high, 60% even very high. The fact
that over 50% of all participants noticed an increase in performance since implementing
the concept of seamless transfers is a good indicator for the effectiveness of recent and
current improvement efforts.

5.3.2 The Development Process

The development process follows a distinct 8-point-milestone concept (Figure 50),
effectively combining clinical and technical aspects as gatekeepers, leading to successful

Successful Approaches to Integrated Development

79

submission. This concept is documented in detail in an internal guideline of drug product

development. The guideline covers all aspects like team structures, responsibilities,
hand-overs, interfaces, etc. The document is reviewed every 2-3 years ensuring to reflect
the current situation and to cover either internally or externally driven adaptations.
The hand-over of a product candidate from Research to Development marks the start of
development. At that time, a compound exists, all research activities are completed, and
it is decided to advance into early development. A transition team, composed of
employees from both Research and Development, is formed and elaborates a predevelopment concept. This covers pre-formulation for use in animal studies in order to
profile the compound toxicologically and pharmacokinetically. Successfully matching
defined criteria as well as the final release by the International Development Committee
initiates the start of development and qualifies the compound to be used in future human
studies.
As a result, Trial Formulation 1, usually a simple drinkable solution or powder-in-abottle, is developed and finally used to supply clinical phase I. During phase I, Trial
Formulation 2 is developed. This form usually is close to the commercial or Intended
Final Formulation, e.g. in the form of a pill if a solid is anticipated. The end of clinical
phase I marks Drug Product Milestone 1. In order to successfully pass this milestone, a
strategic concept for further development must exist, covering aspects like the final
market formulation (composition, administration form, dosage forms, theoretic
manufacturing process, etc.) (by Formulation Development) and decision of the initial
launch site in order to be prepared for its specifics (by Production). Usually, passing of
Drug Product Milestone 1 is just a formality.
Clinical phase II is then initiated, supplied with Trial Formulation 2. During this phase,
Intended Final Formulation, closely resembling the future commercial product, is
developed. A proposal for the manufacturing process already exists and is defined by
key data. Following development of Intended Final Formulation, a hand-over batch is
produced. Focus is on process, product, and analytical performance in pilot scale
environment (compared to previous laboratory scale), shortcomings22 result in an

22

In most cases the change of manufacturing scale coincides with a change in equipment (size, location,
environment, manufacturer, etc.). Such changes always need intense testing, as process parameters might change
with even minor changes in equipment.

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Successful Approaches to Integrated Development

improvement and adaptation loop. If the final formulation and its process performance
are as intended, the project passes Drug Product Milestone 2 and moves from Early to
Late Stage Development.
During pilot scale development, the process is optimized to be ready for
commercialization. The adaptations to the process are rather minor and manufacturing
techniques are not changed, only if commercialization seems rather impossible23. First
in-process-control specifications and general process parameters are defined. Drug
Product Milestone 3 marks the start of development in commercial relevant scales.
During the scale-up of the manufacturing process from pilot scale to full scale, the
process is further optimized in order to meet conditions at commercial scale. Material
from full scale development is used as initial supply of clinical phase III. This phase is
used to gather more data on process parameters. Its primary goal is the development of a
robust and efficient manufacturing process, also considering QbD principles. When the
process is completely defined, running smoothly, and performance in a commercial
relevant scale is as intended, Drug Product Milestone 4 is reached and transfer to the
launch site is initiated.
During technology transfer, the product and the process as well as all accompanying
acquired knowledge are transferred from Development to the dedicated launch site.
Originally, it can be divided into two distinct phases: During evaluation (1) explorative
batches are produced to review and possibly adjust process parameters. This is mainly
due to the change in environment from Development to the launch site. Actual transfer
batches (2) are then produced exactly to the specifications. Acceptance of these marks
Drug Product Milestone 5 and concludes the technology transfer.
The following registration batches are used to generate data for the registration dossier as
well as to re-supply the still ongoing clinical phase III. Alternatively, previous
technology transfer batches can also be used24. Upon successful completion, the project
passes Drug Product Milestone 6.

23

This can have various causes: Usage of a new technology for which not enough commercialization knowledge
exists, early process development was made under time pressure and is not implementable in a larger scale, etc.

24

Initial supply of clinical phase III can be made with products from development. However, it is important that resupply is produced at the same site as the registration batches (usually the launch site). Otherwise it has to be
proven that the product from different environments is bioequivalent in the form of a bioequivalence study.

Figure 50: Development process of Pharmaco1.

Development
Meetings

Joint
Manufacturing

Work
Contributions &
Interfaces

Development
Phases

Development
Milestones

Clinical
Development

Development
Responsibility

MS1

MS2

Hand-Over
Batches

Early Stage Development Centers

Formulation Development

Phase I

Early Stage Development

Process Development

MS3

TechnologyTransfer

Launch Teams

MS4

Phase III

MS5

Registration /
Validation

MS6

Launch Teams

Late Full Scale Technology Transfer Registration Batches

Late Stage Development Center

Phase II

Late Stage Development

Successful Approaches to Integrated Development

81

82

Successful Approaches to Integrated Development

Primary stability studies25 are then initiated. In parallel, the registration dossier is
prepared. Drug Product Milestone 7 is reached as soon as a concept for PAT application
as well as strategies to potential regulatory questions is defined.
When all relevant data is collected and the registration dossier is complete, it is finally
submitted to the regulatory authorities for registration. Upon successful acceptance,
launch batches are produced for product launch, followed by established commercial
manufacturing and initiation of clinical phase IV. Drug Product Milestone 8 marks the
review of the robustness of the commercial manufacturing process and possibly needed
improvements.
In general, all products are transferred from Development to one of the two launch sites.
There is no standardized process for the decision on additional or replacing secondary
manufacturing sites. Strategically important products usually remain at a launch site, but
are also transferred to a secondary manufacturing site in order to ensure contingency and
back-up capacity. Reasons for transferring products away from a launch site to
secondary manufacturing sites may include, but are not limited to: capacity at launch site
needed for another, more important product; high volume, low tech; low-cost
manufacturing; etc. Rather accurate market forecasts as well as clinical data must be
available for such decisions to be taken, usually after Drug Product Milestone 8.
Pharmaco1s development process is currently undergoing a transition from the
described process towards a process supporting the new validation guideline (FDA,
2011). Generally, the process in its entirety does not change; however, some phases will
be less rigid. The whole system will be more flexible and have an underlying continuous
flow towards registration. As implementation is still in progress and will not have
finished in the near future, it is not covered here.

5.3.3 The Organizational Set-Up

Most teams at Pharmaco1 are built as matrix structures and thus recruit their members
from different departments.

25

Primary stability studies assess the long-term stability of the final packaged drug product.

Successful Approaches to Integrated Development

83

The most important development unit at Pharmaco1 is the Core Team Development. It is
built up in a matrix structure and involves stakeholders from all major departments. The
team is led by the International Head of Development and consists of the following Core
Team Members: Medicine, Regulatory Affairs, R&D, Operations, and Marketing. All
core team members contribute to a different amount according to the development
progress. In the beginning, the team is influenced the most by the Core Team Member
R&D. As soon as clinical development starts, the Core Team Member Medicine takes
over. All others are rather supporting, e.g. providing clinical trial supply, publishing
clinical studies and their results, etc. The Core Team Member Operations is part of the
core team; however, Productions interest in the project in the very beginning is rather
small due to the high attrition rate at that stage. The core team is responsible for
advancing the development project through the Drug Product Milestones and reports to
the International Development Committee. This steering committee is finally responsible
for all decisions taken. Each R&D Project Leader directs around one to three
development projects. In core team meetings input from the various sub-teams is
presented by the respective core team member. On a quarterly basis, the R&D Project
Leader presents project results as well as team recommendations for decisions that need
to be taken to the steering committee, who are then taking these decisions. If milestones
are reached, the steering committee decides about milestone approval and senior
management initiates the next project phase.
All core team members lead an individual sub-team and take their sub-teams inputs into
the core team.
All team members of the Sub-Team Operations are from the Production department. The
core Team Member Operations is involved from the beginning and always part of any
decisions (especially regarding manufacturing technologies). However, their contribution
is limited in the beginning and is only increased when launch is approaching. Project
leaders of the Sub-Team Operations usually lead ten and more projects, so their attention
to single projects is very limited. This sub-team covers mainly quality topics, supply
chain management, logistics, purchasing and is mainly concerned about design to cost
as well as launch preparedness and launch readiness (e.g. how to best plan launch in
order to penetrate the markets in a most efficient way. The Sub-Team Operations is
formed around Drug Product Milestone 5.

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Successful Approaches to Integrated Development

The Sub-Team R&D is organized as a matrix structure and involves representatives from
both Development and Production. It is divided into a CMC and Bio Sub-Team, of which
only the first one is covered further. Among others, the CMC Sub-Team consists of
employees from Chemical Development and Production, Pharmaceutical Development,
process engineers (equivalent to Pharmaceutical Development but inside Production),
Analytical and Medical Sciences, QA and QC from both Development and Production,
and Packaging Development.
The team member

representing pharmaceutical development (Team Member

Pharmaceutics) changes over the course of the project: during early development the
Team Member Pharmaceutics is represented by a member of Early Stage Development,
in later development phases it is substituted by a member of Late Stage Development.
Early Stage Development is divided into different groups due to their different locations.
During early development activities, team leaders function as Team Member
Pharmaceutics in the superordinate Sub-Team R&D. Early Stages responsibilities
include trial formulations development, dosage finding, early formulation and process
development, definition of early in-process-control specifications, and final formulation
development.
Late Stage or Process Development consists of three project teams and one supporting
and enabling team. In the project teams the processes are developed. The team leaders
are representing the project in the superordinate Sub-Team R&D. They pass on the
current project status, next steps, and everything else discussed in the project team. The
supporting and enabling team mainly provides services such as risk assessments,
documentation, and other supporting functions to the project teams. There is a significant
amount of job rotation in Late Stage Development. The main reason is to educate
employees in other areas so that they better understand requirements and demands from
either Early Stage Development or Launch Teams. Besides this valuable learning, it may
also provide additional capacity when needed. In case of larger capacity shortages,
external employees can be acquired in order to still be able to deliver results. Late
Stages main tasks include: development of robust and efficient manufacturing
processes; consideration of QbD aspects; consulting during formulation development,
especially regarding manufacturing technologies, to facilitate commercialization;
responsibility of technology and know-how transfer from Development to launch sites;
support of activities up to registration and submission; manufacturing of material usable

Successful Approaches to Integrated Development

85

for clinical trials; preparation of contributions to documents for clinical studies and
submission.
Process developments counterpart in the Sub-Team R&D is a Process Engineering
Team at the launch sites. This team is responsible for the development project after
successful technology transfer, forms the Launch Team, and is the direct partner of Late
Stage Development. Although this is an often used interface, they are differently
organized: Productions engineering team has substantially more employees than
Developments process development team.
Process Development is part of Developed and located at Pharmaco1s main (late stage)
development center. Transfer from Development to Production occurs from Late Stage
Development to a special Launch Team; however, there is no intermediate organization.
The Launch Team is part of Production and reports to the launch site. Pharmaco1 has
two designated launch sites with high technological standards.

5.3.4 Cross-Functional Collaboration

Cross-functional collaboration has a long standing tradition in Pharmaco1. A few years
ago, an initiative was formed out of the Process Development department. It was the
direct result of repeated discrepancies at interfaces and hand-overs. The initiatives
ultimate goal was not to change the process itself but rather to smoothen the existing
work flow and to improve the cross-functional collaboration and interfaces. It followed
an idea of having seamless transfers along the technical development process by
eliminating obvious boundaries, interfaces, and hand-overs of responsibility as well as
actual work contributions between different functions. Mainly, following teams are
involved earlier and longer after completion. Thus it is ensured that information is
passed on correctly and backwards learning is possible. Involvement usually begins with
information being shared, then collaboration grows more intense until responsibility is
taken over. In the end, the replaced function supports the project in a consulting function.
The initiative was immediately implemented and in its context several guidelines and
other documents were adapted in order to reflect the new way of collaboration. Although
meanwhile in action for several projects, implementation is still not fully completed.
Along the development process the Team Member Pharmaceutics of the Sub-Team R&D
holds responsibility for technical development. However, on the technical level this team

86

Successful Approaches to Integrated Development

member changes through the process, there is no single person responsible from end-toend, mainly to ensure that the project leader also holds specific expertise during all
development steps. R&D Project Management leads the project rather administratively
and mainly towards the upper steering committee.
All interfaces and hand-overs are well documented. The process is formal yet flexible
and tailored to Pharmaco1s situation and requirements.
For the internal survey about the collaboration along the development process it was
simplified into the most important steps (Figure 51).

Early Stage
Development

Pilot Scale

Full Scale

Technology
Transfer

PPQ* /
Validation

Registration

Launch

Post-Approval
Improvements

Figure 51: Development process steps at Pharmaco1 (*Process Performance Qualification).

In total, 30 employees from Late Stage (9) and Early Stage Development (8), Production
(8), and R&D Project Management (5) participated in the internal survey. This provides
a representative assessment. The results show Pharmaco1s very intense and seamless

Early Stage Development

Late Stage Development
Production
R&D Project Management

100%
C
I
C

9%
91%
C
C

I
52%
48%
C

Pr
oc
e
Q ss P
ua
lif erfo
ic
a t rm a
io
n nce
La
un
ch
Po
st
Im App
pr ro
ov va
em l
en
ts

at
io
n
Re
gi
str

hn
ol
og
y

Tr
an
s

I
100%
C
C

Te
c

le
Fu
ll
Sc
a

Ea
rly
D Sta
ev g
el e
op
m
en
Pi
t
lo
tS
ca
le

fe
r

way of collaborating (Figure 52).

41%
59%
C

12%
88%
C

I
100%
C

100%
I

Figure 52: Results of the internal survey: cross-functional collaboration at Pharmaco1.

When a project enters technical development, the Early Stage Development group takes
over the lead. The Team Member Pharmaceutics is represented by an Early Stage
Development project leader at one of the Early Stage Development sites. Before Drug

Successful Approaches to Integrated Development

87

Product Milestone 1, Early Stage confronts Late Stage with project plans and intentions.
Although this is only a paper assessment (no technical details are considered), it ensures
that development goes into a direction that is suitable for larger scales as well. Late
Stage is further informed from Drug Product Milestone 1 meeting on. During technical
development of the Intended Final Formulation, the Early Stage Development group is
doing all the work in lab scale by themselves. After around 60% of the work is done, a
member of the Process Development group (Late Stage Development) inspects the
process and its performance in lab scale at Early Stage facilities and defines further
measures to be taken before transfer to Late Stage as well as the upcoming transition
phase. Concluding early stage development, the transition phase begins: a hand-over
batch is produced by Early Stage at Late Stage facilities in pilot scale in order to analyze
product and process performance. Unsatisfactory analytical or performance data may
result in an additional re-work loop for Early Stage.
The project lead, represented by the Team Member Pharmaceutics, then switches from
Early to Late Stage Development. The currently available information and timelines are
discussed with both major involved functions Early Stage and Launch Group. Early and
Late Stage commonly perform a risk analysis which is derived into a development plan.
From then on Early Stage is only informed about the project. The development plan is
shared with the Launch Group so that they can prepare for potential technologies used
during later commercial manufacturing. During rather informal information meetings all
involved functions are regularly informed about the project. The Launch Group is
actively involved during full scale development. Representatives of the Launch Group
observe final full scale batches. The focus is on PAT technologies, mainly because these
technologies are taken over by commercial manufacturing. Often they measure data with
their own equipment in order to gain process knowledge applicable to commercial
manufacturing. With the successful conclusion of full scale development technology
transfer starts. Work is equally distributed between Late Stage and the Launch Group
and done in full collaboration.
If the conjointly produced transfer batches are accepted by the Launch Group,
responsibility (except for the drug registration) is handed over to Production. Late Stage
is supporting further activities from a consulting role and is on-site as trouble shooter.
Today, knowledge transfer along the development process is assured by (1) meetings
(milestone meetings, team meetings, preview meetings, etc.), (2) joint studies (e.g.

88

Successful Approaches to Integrated Development

conjointly manufactured demonstration and hand-over batches), and (3) reports

(development report, master batch records, correlation matrices, safety report, etc.).
Especially meetings have proven to be an effective way of sharing information. For
example between Drug Product Milestones 1 and 5 there are six appointed meetings: a
hand-over preparation and an actual hand-over meeting between Early and Late Stage; a
simple informative, an informative and planning, a transfer planning, and a transfer
review meeting between Late Stage and the Launch Group. In general, hand-over of
documentation is established in practice. Furthermore, early involved groups can always
be consulted in case of upcoming issues.
However, this only covers forward knowledge transfer. Backwards transfer or learning is
not established. New insights gained or problems solved during commercial
manufacturing do not go back to Development and thus problems and issues cannot be
prevented from happening again. Also, different groups use different IT tools for
documentation of their data. Often they are not compatible and therefore information is
only available in one system and to one specific group.

5.3.5 On-going or Past Improvement Initiatives in Late Stage Development

There have been numerous improvement initiatives in Late Stage Development in the
recent past which are all consequences of identified deficiencies. In general, there is a
strong culture of continuous improvement present and improvements are not only
planned in theory, but also implemented and measured in practice. All following
initiatives were widely accepted and perceived to be beneficial (Figure 53):
Reduction of API usage during technical development: There are efforts to
combine different development phases in order to save API. As API is rather
expensive, there is increasingly less of this resource at disposal for technical
development. This requires higher resource usage efficiency as well as time
savings. Accompanying risks can be calculated and controlled. As an example:
manufacturing of clinical trial supply and manufacturing development can be
combined. For this, process parameters during clinical trial batches are varied in
order to describe procedural aspects.
Enhanced implementation of PAT applications: This initiative aimed at
increasing the usage of PAT in early development. The result is more process

Successful Approaches to Integrated Development

89

understanding and easier transfer to commercial Production. Additionally it

helps to build up a solid data base and improve and refine existing models (e.g.
scale-up model).
Revision of the Early Late Stage hand-over guideline & revision of
transfer concept from Late Stage Development to Production: Both
initiatives addressed interfaces of Late Stage Development. In the context of the
seamless transfer approach it was of course mandatory to also adapt existing
guidelines in order that they reflect the current situation. Solid definition of
interfaces and hand-overs is the key to minimizing losses during hand-overs.
Both initiatives are

perceived to be beneficial; however, especially

representatives from Early Stage Development sometimes do not feel adequately

represented. For the interface between Late Stage Development and Production
the unequal organizational set-up of both organizations constitutes minor
differences.
Harmonization initiatives addressing gaps in manufacturing process and
equipment: This initiative improves transfer processes from development to
commercial scale when there are no significant differences in equipment in the
environments. These initiatives are all perceived beneficial. However, it is
believed that further efforts to even higher harmonization would only provide
minimal improvements and thus not return enough benefit.
Introduction of new risk assessment tools and IPC26 strategy: The new risk
assessment tools are a valuable help in taking decisions during technical
development. They are perceived beneficial.

26

IPC stands for In-Process-Control and means the measurements undertaken in running processes in order to
measure quality during rather than after manufacturing processes.

90

Successful Approaches to Integrated Development

Enhanced Implementation of
PAT Applications

26%

74%

Revision of the Early - Late Stage

10% 15%
Hand-Over Guideline

75%

Revision of Transfer Concept from

Late Stage Development to
4%9%
Manufacturing

dis-advantageous
87%

beneficial

Harmonization Initiatives Addressing

Gaps in Manufacturing Processes 4% 19%
and Equipment

77%

Introduction of New Risk Assessment

4% 22%
Tools and IPC Strategy

74%

0%

20%

neutral

40%

60%

80%

100%

Figure 53: Internal perception of on-going and recent improvement initiatives at Pharmaco2.

5.3.6 Potential for Further Improvement

Pharmaco1 is very advanced in both planning and implementation of integrated
development. There is a deep understanding of continuous improvement and employees
never rest but always strive for further optimization. Following this concept, there is still
some potential for further improvement of Pharmaco1s approach. Following, some
potential fields of action are listed, however, this list is not exhaustive and more potential
can always be identified:
Resource shift for selected work packages: More effort in early process steps
(e.g. pilot scale development) in order to gain more process knowledge at an
early stage in the development process. This leads to more process
understanding and to the refinement of existing scale-up models. As a
consequence, major parts of later process steps, namely full scale development,
may be integrated into technology transfer and thus API usage can be optimized.
Further enhance the seamless transfer approach to smoothen actual handovers: by widening interfaces even more, by overlapping different groups, and
by involving individual groups earlier and longer. Furthermore, the seamless
transfer approach could be globalized by starting earlier (including late
research), ending later (e.g. also covering early commercial manufacturing), and
including more participating groups, functions, and departments. Also, the

Successful Approaches to Integrated Development

91

approach should be adapted so that it meets not only Late Stage Developments
but also at least Early Stage Developments and Productions requirements and
constitutes a real benefit to these groups as well.
Improving the knowledge exchange culture between Early and Late Stage
Development as well as Production. This also includes trainings in other groups
activities and tasks (e.g. members of Early Stage Development should be trained
in late stage development activities in order to better understand requirements of
Late Stage Development and Production).
Implementation of an advanced knowledge management system. This can be
accomplished by either harmonizing existing systems (e.g. IT tools) or by
implementing a new system in order to facilitate knowledge exchange and data
access (one single, central place for storage with appropriate access rights). Such
a system is a valuable help in acquiring and reusing gained process and scale-up
knowledge.
Extended harmonization of equipment and processes between Development
and Production will further optimize and shorten the transfer process. However,
it has to be considered that the benefits must always be higher than the needed
efforts, thus excessive harmonization cannot be the ultimate goal.

Excursus: Quality by Design in Practice

So far, there are no general roadmaps for practical implementation of QbD. Furthermore,
due to different definitions and understandings, there is not even consent regarding the
topics a successful QbD implementation should cover. Two general challenges can be
identified: (1) Each development and manufacturing site in a companys network has
different capabilities and thus QbD technologies cannot easily be adopted between
manufacturing sites. (2) QbD registrations are only accepted by certain regulatory
authorities and thus double effort is required to also cater for those demanding classic
registrations.
Pharmaco1s QbD approach covers enhanced QbD elements (such as Design Space and
PAT). It is used to gain operational flexibility and deeper process understanding.
Furthermore, it facilitates scale-up and transfers of processes.

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Successful Approaches to Integrated Development

In 2009 an initiative was started with the objective to define a new roadmap for
manufacturing evaluation, transfer, and registration batches. The concept titled
Optimization of Transfer from Late Stage Development to Launch Site had the
intention to optimize transfer processes in order to enhance common product and process
understanding as well as the implementation of joint manufacturing teams.
In 2011, this transfer concept was further developed by means of a concept paper
revision, including QbD aspects in the revised roadmap. QbD as a systematic approach
to development that begins with predefined objectives and emphasizes product and
process understanding and process control, based on sound science and quality risk
management (ICH, 2009, p.16) not only enhances pharmaceutical quality but also
increases process understanding and thus helps to develop robust processes.
This was reached with an early and consistent implementation of PAT to optimize scaleup and transfer. An additional benefit was to minimize the number of evaluation and
transfer batches, the batch size, and the transfer time. The focus of PAT application is to
understand and control the manufacturing process. A process is robust when all critical
sources of variability are identified, understood, and managed by the process and product
quality attributes. Pharmaco1 applies PAT early in process development in order to
acquire process knowledge and thus improve processes. It is also used to support IPC,
however, it does not substitute it and it is not planned to file PAT parameters with
regulatory authorities, unless required. PAT is used during technology transfer to get the
final data for registration. Overall, PAT application is widely distributed for internal use.
Concluding, PAT is mainly used for scale-up and transfer of processes: adjustments are
easier when process parameters can be monitored.
Pharmaco1s desired state of an early and consequent implementation of PAT to
optimize scale-up is not fully reached yet. One reason for not filing PAT with regulatory
agencies is that as of today the technologies and know-how are only available in
Development and at launch sites. Secondary manufacturing sites are not equipped
appropriately. As a consequence, filing of post approval changes including conventional
IPC methodologies would be mandatory.
There are potential advantages of implementing QbD in development. Mainly process
understanding is increased and thus scale-up is smoother. Full QbD will not be included
in registration because not all regulatory authorities accept it and thus completely

Successful Approaches to Integrated Development

93

different concepts would have to be registered for different markets. Applying QbD or
related concepts (such as e.g. PAT) early in development improve scale-up and
technology transfer and also have a great impact on operational excellence in
commercial manufacturing.
In an internal survey at Pharmaco1 different obvious benefits in implementing QbD
elements were identified (Figure 54). Early and extended application of enhanced QbD
elements, such as PAT, will add to an increased process understanding and help build up
a valuable knowledge base to simplify future development projects. Consistent
application will further optimize scale-up and technology transfer (the impact of
implementing enhanced QbD elements is to get a beneficial process understanding).

Operational Flexibility 7%

Reduction of
7%
Post-Approval Changes

24%

69%
dis-advantageous

33%

60%

neutral
beneficial

Process Understanding 0%
0%

100%
20%

40%

60%

80%

100%

Figure 54: Impact of implementing enhanced QbD elements.

Gaining process knowledge and monitoring and control of manufacturing processes are
the most beneficial aspects of PAT (Figure 55). Additionally, efficiency increase during
process development and transfer is perceived to be a further benefit of PAT
implementation.

94

Successful Approaches to Integrated Development

Gain of Process Knowledge 4%11%

86%

Monitoring and Control of

3%
3%
Manufacturing Processes

93%
dis-advantageous
neutral

Risk Mitigation during

Process Development 4% 21%
and Transfer
Efficiency (Timeline / Reduced
API Consumption) Increase during
Process Development and Transfer

18%
0%

75%

25%
20%

40%

beneficial

57%
60%

80%

100%

Figure 55: Impact of implementing PAT.

QbD should be supported by an integrated knowledge management solution in order to

profit from previous knowledge in a most effective way. However, Pharmaco1 still does
not have such a solution but rather different systems without thorough synchronization.
Furthermore, data access cannot is not provided to all involved scientists and engineers.

5.4 Case Pharmaco2

5.4.1 The Company
Pharmaco2 is a highly specialized, research-oriented global biopharmaceutical company
focusing on human pharmaceuticals. It was founded in the 1950ies with the purpose of
providing treatment to life-threatening conditions. At that time the company became a
pioneer by applying novel biopharmaceutical techniques to develop and manufacture
pharmaceutical products. Over the last 20 years it showed a double-digit growth rate.
The company is completely family-owned and still managed by a direct descendant of
the original founder. It is headquartered in Europe and has more than 4,500 employees
worldwide. It has a direct presence in over 50 countries and its products are distributed
in over 90 countries.
Pharmaco2 specializes in several key therapeutic areas, all of them related to human
health. There are no distinct activities in the field of animal health.

Successful Approaches to Integrated Development

95

Pharmaco2 covers a focused range of research areas. There are six research centers in
Europe, the Americas, and Asia. Each of these centers focuses on specific therapeutic
areas as well as market access to specific regions. Pharmaco2 actively collaborates with
various research institutes and other pharmaceutical and biotechnology companies across
the globe.
All research centers are involved in early development activities related to their focused
therapeutic area. However, there are two distinct Science Centers, located in Europe
and the USA respectively, coordinating all development activities undertaken at the
different research centers. This set-up allows vast interaction mainly in the transition
phase between late research and early development activities while simultaneously
following a centralized approach. Late development activities are mostly done by the
Science Centers, where late stage development capabilities are concentrated and
connections to commercial Production are most efficient.
In Pharmaco2 there are several pilot plants, each representing a scaled-down commercial
production environment. This allows adapting to commercial requirements in a rather
sub-commercial scale during an early phase of development and optimizing processes
for the transfer to commercial manufacturing. However, these plants are often not
available due to limited capacities. In such cases, either external or commercial capacity
has to be acquired. The use of pilot plants implicates a rather early decision about the
future manufacturing site.
A substantial number of development projects are outsourced at Pharmaco2. As a
general rule, development is done internally if capacities are available, (technological)
capabilities already exist, or costs of building-up technology capabilities and knowledge
are beneficial. In general, external development needs much less internal resources and
does not influence the critically observed headcount. Often the outsourced development
projects are not internalized but rather manufactured by a third-party-manufacturer as
well.
Pharmaco2 has a network of production sites in 11 countries. Transfer of commercial
products between different manufacturing sites occur and follow a similar concept as
technology transfer from development to first manufacturing sites.
There exist powerful and above-average concepts for pharmaceutical development and
technology transfer towards more cross-functional collaboration and less silo-thinking

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Successful Approaches to Integrated Development

and -acting. The main challenge for Pharmaco2 is to thoroughly implement and live
these concepts as well as to continuously adapt them to the ever changing circumstances.

5.4.2 The Development Process

The development process at Pharmaco2 follows a distinct system consisting of 8
milestones and 7 gates (Figure 56). It is defined in the Development Project Manual,
which covers all development aspects (technical, clinical, analytical, etc.) in a rather
undetailed form and without specifying reference-timelines. An IT-based project plan
template as well as additional detailed documents complete the development project
documentation. This project plan is adapted in the beginning of a project and reflects the
kind of project and other specifications (e.g. drug type, formulation type, etc.). The more
a project advances, the more this project plan becomes an accurate tool. The plan is
continuously updated and adapted to reflect on-going changes.
There is a separate corporate SOP for technology transfer defining phases, work
packages, deliverables, responsibilities, and involvement. It splits technology transfer in
four phases: Tech Transfer Pre-Phase, Tech Transfer Phase 1 & 2, and Tech Transfer
Post-Phase. This SOP was originally issued in 2004, since then continuously optimized,
and majorly improved in 2010. However, it is not always followed strictly and activities
beyond fulfilling regulatory requirements are sometimes handled with less priority.
Different documents, such as the Development project Manual, project plan template,
technology transfer SOP, and manuals from Production, are mostly not aligned and
milestones not linked (e.g. both Development and Production have their own project
plans). The contents are similar but generated independently and an overall flow through
all documents is missing. In the future, all documents shall fit together and each details a
certain step or involvement. Such an alignment and revision is planned for the near
future.
The documented development process begins in late research with promising ideas for
new or improved products. The first two Milestones cover topics such as scientific and
clinical rationale, commercial potential and attractiveness, assessment of IP27 situation
and competition as well as the demonstration of the chemical and biological feasibility.

27

IP stands for intellectual property and basically means the patent protection by law.

Successful Approaches to Integrated Development

97

Based on this and additional data, at Gate 1 it is decided whether to proceed to drug
discovery or to abort the project. The activities leading to the following two Milestones
deal with further research, pre-formulation, and regulatory strategy. Gate 2 marks the
decision to proceed to Early Stage Development. At that time, detailed strategies for
regulatory, CMC, and clinical are defined and a global development plan specifying
early dosage form, time-to-market, costs, etc. is created. Gate 2 triggers official project
initiation, where a concept including timings, costs, and risks and a development plan
(project plan) are created. Project execution then follows after approval by the highest
board. The project and its major outcome, a clinical candidate, are transferred to
Development, which is now responsible.
This marks the start of Tech Transfer Pre-Phase. Formulation development starts by
screening different formulations in order to identify the best one. In parallel, the
manufacturing process associated with the chosen formulation is developed. During that
phase, there is a tremendous overlap between formulation and process development. It is
also used to develop analytical methods (e.g. for stability tests). First considerations
regarding primary and secondary packaging are made. Generally, all processes are in lab
scale, meaning a few hundred grams up to one or two kilos. More extensive process
development (e.g. kind of granulation, kind of coating, etc.) starts with a one kilo scale
and includes screening technologies, general process investigation, and identifying
process parameters. During Tech Transfer Pre-Phase non-clinical safety studies (the
results mark Milestone 5), clinical phase I (the results mark Milestone 6), and clinical
phase IIa are conducted.
Right before the end of clinical phase IIa and when the process is ready to be upscaled, the development project moves to Tech Transfer Phase 1. The goal of this phase
is to develop and scale-up capable processes, meaning they are robust and controllable
within specified ranges. Therefore Pharmaco2 uses a scientific approach: in (scale-up)
experiments it is assessed what parameters vary, then the reasons are identified, and in
the end strategies for controlling these variations are developed and applied. At the end
of clinical phase IIa POC is reached. This marks Milestone 7 and means that the
manufacturing strategy as well as estimated manufacturing costs are determined. The
manufacturing strategy also contains the decision on the first commercial manufacturing
plant. Information about the (potential) receiving (first manufacturing) plant is gathered
in order to consider these specific settings and equipment. Reaching POC also means

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Successful Approaches to Integrated Development

that the project moves from Early Stage to Late Stage Development. When the final
formulation development is finished, the manufacturing process scale-up starts: in pilot
plants the process is scaled-up from a few hundred grams to 5-20 kilos. The environment
in pilot plants is very close to the one in the first manufacturing plant. The process is
continuously adapted to meet the specifications. Material from pilot plants (pilot scale)
can be used to supply on-going clinical studies. If the quality is right, it can later even be
used as initial supply for clinical phase III. In the case of internal development and
extensive technology knowledge, controllable risks, and capabilities at the first
manufacturing plant, the pilot scale can be omitted and scale-up is done from few kilos
to few hundred kilos. Further scale-up to commercial scale occurs at the first
manufacturing plant. During scale-up, primary and secondary packaging development is
finalized and stability data is collected. Clinical phase IIb runs in parallel to process
scale-up. At Gate 3, based on clinical phase II results, it is decided whether to proceed
with development and start clinical phase III.
Tech Transfer Phase 2 marks the actual transfer from pilot or intermediate to full or
commercial scale and along with this from Development to the first manufacturing plant.
It starts when it has been shown that scale-up is possible and process development is
completed. Tech Transfer Phase 2 is usually executed prior to or during clinical phase III
to assure that (re-)supply is in a relevant scale and can be used for validation and
submission. Material from commercial scale production is used to (re-)supply clinical
phase III (initial supply can be from pilot scale production). Tech Transfer Phase 2
covers the development of analytical procedures, scale-up to commercial relevant scale,
further process adaptations, and stability testing. Full scale batches show that the process
works (can be used for clinical re-supply). While clinical phase III is running, a detailed
commercial and pre-launch plan is established at Gate 4. Milestone 8 marks the end of
clinical phase III, where results are analyzed. At the end of this phase the project
responsibility is transferred to the Transfer Organization.

Successful Approaches to Integrated Development

Figure 56: Development process of Pharmaco2.

99

100

Successful Approaches to Integrated Development

During Tech Transfer Post-Phase, the transferred process is validated and the
submission documents are generated. Eventually, the project is filed for submission at
Gate 5. After a successful launch phase, the product is transferred to business at Gate 6.
The project then enters post-approval continuous verification and improvement: the
process and especially the critical process parameters are monitored and controlled so
that the specifications are constantly met. Upcoming manufacturing issues are usually
handled by the manufacturing site; however, in case of analytical or regulatory issues
Developments Maintenance Team is involved.
Pharmaco2 does not yet follow a complete QbD approach. So far, a scientific approach
and singular QbD elements are used and it is planned to adopt more of QbDs general
ideas. Reasons for this are mainly to obtain more robust processes, to gain more in-depth
process knowledge, to meet regulatory requirements, and to get easier approval with a
QbD aligned development process. However, Pharmaco2 has yet not finally concluded
whether a full blown QbD approach is really paying off.

5.4.3 The Organizational Set-Up

Pharmaco2s development teams are often an assembly of specialists from different
departments each representing a function involved at certain development steps.
In general, there is a committee responsible for all development activities. It initiates a
project at Gate 2 and takes all important decisions thereafter as the ultimate instance.
The actual development teams constitution changes along the development process. In
the beginning it is dominated by Pharmaceutical Development which also holds project
responsibility. Right from the start, the teams include members from the central Transfer
Organization, usually a production project manager. However, in the beginning, the
interaction is limited to information exchange. In case of third party development
projects, external specialists are also part of development teams. They are leading
through all development steps until technology transfer. In case of complete external
development projects, these teams function as the point of contact for the external
developer and therefore uses only very few internal resources (as no work is done inhouse).
In the beginning of Tech Transfer Phase 1 the Tech Transfer Team (TT Team) is
formed. It is responsible for successfully guiding the development project through

Successful Approaches to Integrated Development

101

technology transfer and thus from Development to Production. It has members from Late
Stage Development and from the Transfer Organization as well as from the final
receiving site.
The Transfer Organization is the major bridge between Development and commercial
Production. The organization is part of central Production, which also holds other
functions like global supply chain, global purchasing, etc. Central Production is without
any manufacturing site, it is mere a service organization within Production.
There exist several pilot plants for specific product families. They are all used during
internal development according to their capabilities. Thus they fully belong to
Development.
Another functional unit is called Maintenance. It is part of Development; however, it is
not involved in primary development activities. Its main tasks are related to commercial
manufacturing with focus on analytical and regulatory issues (compared to processrelated problems handled by the manufacturing site).
Process development is part of Pharmaceutical Development (R&D) and to a large
extent concentrated at Pharmaco2s two science centers. Transfer from Development to
Production occurs from Late Stage Development via an intermediate organization to a
commercial manufacturing team. The intermediate or Transfer Organization is part of
central Production, but does not report to a specific manufacturing site. Its main task is
the coordination between Development and commercial Production. It is the
Development counterpart in Production and closely collaborates with commercial
Production. Pharmaco2 has no designated launch sites the first manufacturing site is
chosen for each project specifically, based on capacity and capabilities.

5.4.4 Cross-Functional Collaboration

Interfaces and hand-overs are documented in separate SOPs or other documents. In the
past it was demonstrated that the individual documents in some cases do not match
others; however, this was subject to optimization at the time of analysis. The process is
loosely formally defined and often not strictly followed. This cannot solely be attributed
to wrong or incomplete planning, but to a high degree of flexibility of the process. This

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Successful Approaches to Integrated Development

is mainly due to Pharmaco2s rather small size and thus limited resources as well as
intense collaboration with CROs28 and CMOs29.
For the internal survey about collaboration along the development process, Pharmaco2s
development process was consolidated into seven simple but representative process steps
(Figure 57).

Early Formulation
Development

Early Analytical
Development

Early Packaging
Development

Early Process
Development
(Lab Scale)

Final Formulation
Development

Early Stage Development

Final Process
Development
(Pilot / Full Scale) /
Process Verification

LateStageDev.

Technology
Transfer
Document

Technology
Transfer

Technology Transfer

Late Process
Development
(Lab / Pilot Scale)

Final Analytical
Development /
Analytical
Validation

Final Packaging
Development

Late Stage Development

Development
Report

Process
Validation

Report of
Equivalence

Product Launch

Post-Launch
Improvements

LateStageDev.

Early Stage Late Stage

Technology
Development Development Transfer

Process
Validation

Report of
Equivalence

Product
Launch

Post-Launch
Improvements

Figure 57: Development process steps at Pharmaco2.

In total, 15 employees from Pharmaceutical Development (6), Production (including the

Transfer Organization as well as manufacturing sites) (7), Regulatory (1), and Quality
(1) participated in the internal survey. This provides a representative assessment. The
results show Pharmaco2s very intense and cross-functional way of collaborating (Figure
58).
Early stage development activities are entirely led by Development. Later involved
functions, such as QA, Regulatory, and Marketing, are kept informed in order to be
prepared when the project advances further and their contribution is needed. Tech

28

CRO stands for contract research organization. Basically this denotes a company offering research and
development services.

29

CMO stands for contract manufacturing organization. Such a CMO or third party manufacturer offers
manufacturing as service.

Successful Approaches to Integrated Development

103

Transfer Phase 1 start is when the Transfer Organization is joining the project team. This
is also around the transfer from Early to Late Stage and when clinical POC is reached. In
the beginning, the collaboration is limited to extended information sharing from
Development to Production (e.g. receiving meeting minutes). The collaboration then
intensifies the more late stage development advances. At the beginning of scale-up,
information about the receiving plant is being collected (e.g. exact equipment, setting,

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capabilities, etc.).

Pharm. Development
Transfer Organization
Production
QA
Regulatory
Marketing

100%
I
I
I
I

78%
12%
10%
C
I

54%
29%
17%
C
I

22%
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48%
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28%
27%
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C
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19%

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62%
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Figure 58: Results of the internal survey: cross-functional collaboration at Pharmaco2.

Technology transfer starts when entering commercial manufacturing scale. It is mainly

about establishing cooperation (between Development and Production), handling
coordination (by the Transfer Organization), and transferring knowledge. There exists a
detailed corporate SOP (issued in 2004, revised in 2010) regulating interactions and
responsibilities; however, it is not always followed (except for e.g. regulatory
requirements). Responsibility of technology transfer still is with Late Stage
Development. Other than the Transfer Organization, the receiving or future
manufacturing site is also involved in order to represent the commercial environment.
Responsibility changes after the actual transfer is done and validation is about to start.
Process validation is mainly driven by Production.
Post-launch (analytical) issues are addressed in collaboration with Maintenance from
Development. Although organizationally they belong to Development, there is no
transfer back to Pharmaceutical Development. General process adaptations and
improvements are done by manufacturing engineers and do not flow back to

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Successful Approaches to Integrated Development

Development. In general, commercial manufacturing issues are handled in a siloed

structure and knowledge gained in this phase is not shared with other functions.
Knowledge management is most intensively occurring during technology transfer.
Generally, it is resource-dependent: after responsibility is handed over, no resources
from the previous owner are assigned in order to receive backwards knowledge transfer.
Outside of technology transfer the knowledge transfer is not standardized and occurs
rather unstructured. Backwards transfer almost never occurs, especially not from
commercial Production back to Development.
There is no integrated and IT-based knowledge management solution in place.
Knowledge management consists mostly of a combination of different tools that often do
not fit entirely. However, a so-called QbD loop is perceived to be beneficial: lessons
learned and insights from one project should be documented and managed in order to be
accessible for future projects rather than being with single persons that have to be
consulted.

5.4.5 The Potential for Further Improvement

Pharmaco2 has developed a very advanced concept of integrated development and is in
the process of implementation. This also implies that some aspects still have to prove
effectiveness in daily business. In the current theoretical and practical concept some
potential for further improvement was identified:
Overall Late Stage Development to commercial Production concept: A
general revision of the overall concept from Late Stage Development to
commercial Production could define more intense collaboration and broader
interfaces. This could include the following adaptations: Earlier and clearly
specified involvement of the Transfer Organization, earlier involvement of first
manufacturing site, and longer involvement of Development past launch and into
commercial Production. A revised solution with clearly defined interactions,
responsibilities, and hand-overs improves collaboration at interfaces. Early
involvement results in better preparation for future commercial manufacturing
capabilities and equipment.
Harmonization: Further harmonization of capabilities and along with them also
the equipment between pilot plants and first manufacturing sites would be

Successful Approaches to Integrated Development

105

beneficial. The harmonization could even be extended further in both directions

by further aligning Late Stage Development labs and secondary manufacturing
sites. Obvious benefits would be better harmonization of Late Stage
Development and future commercial Production as well as fewer adaptations
needed at scale-up and technology transfer.
Knowledge transfer and knowledge management solution: A formalized
knowledge transfer process should be defined. Importantly, both directions have
to be covered, meaning not only to define the process of knowledge transfer
along the development process but also the transfer back. As the amount of
knowledge generated during each project is immense, this process has to be
supported by an integrated knowledge management solution. An IT-based
solution should connect all participating groups and enable easy knowledge
exchange. As a consequence, knowledge generated would not be lost and be
accessible to everyone at any stage, more cross-project learning would be
occurring throughout development projects in different stages, and knowledge
would be accumulated and built-up.
Training: Special training and information for all involved employees, groups,
and departments. This would result in better understanding and awareness of
overall and detailed responsibilities and contributions during development
projects.

5.5 Insights from the Case Study Research

5.5.1 Cross-Case Comparison
Both companies have their own, individual approaches to technical development;
however, they do not differ substantially. The following list provides an overview of all
commonalities and differences:
Both Pharmaco1 and Pharmaco2 have their process development group
organizationally in Development. In both companies, this is the last development
group involved along the process; all following groups are organizationally
affiliated with Production.

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Successful Approaches to Integrated Development

Both companies do not transfer from Development to commercial Production

directly, but via an intermediate organization or group. However, while
Pharmaco2 has a real Transfer Organization (with the sole purpose of supporting
transfers and connecting Development and Production), Pharmaco1 has Launch
Teams exhibiting a similar function. It is notable that these are temporary teams,
only assembled for transfers before product launches. Therefore they often lack
the routine. In order to compensate this, the process development group in
Pharmaco1 is more involved in transfer activities than in Pharmaco2.
They both have development facilities representing commercial equipment to
some degree; however, Pharmaco1 shows a higher degree of harmonization.
The overall approach to integrated development is comparable. Pharmaco1 has
started earlier and is therefore advanced further regarding implementation.
Pharmaco2 is still in the process of implementation.
Pharmaco1 therefore has executed more initiatives with the goal of improving
the current approach. Most notable is the concept of seamless transfers: as a
direct result of issues at hand-overs, this concept was designed and implemented.
Both companies stress the significance of a holistic knowledge management
solution, both without having such an effective tool in use.

5.5.2 Comparison with the Literature

The importance of cross-functional teams mentioned in literature is also seen in both
companies (Koufteros et al., 2005; Gerwin and Barrowman, 2002; Droge et al., 2000;
McDonough, 2000; Griffin, 1997b). However, success factors differ slightly from
literature findings:
Whereas in the literature all previously mentioned success factors proved to be
important, in both case studies is becomes obvious that mainly top management support
and a culture supporting cross-functional collaboration are important (McDonough,
2000; Holland et al., 2000). All others are not irrelevant; however, their influence is very
limited.
Furthermore, in the literature rather technical success factors are not mentioned
(McDonough, 2000; Cooper and Kleinschmidt, 2007; Holland et al., 2000; Kim and
Kang, 2008). Especially harmonization found in Pharmaco1 proves to significantly

Successful Approaches to Integrated Development

107

improve transfers. Knowledge management was mentioned in the literature, but not with
the importance it was found to be mentioned by both companies.

5.5.3 General Insights

From these two case studies the following general conclusions and consequences can be
drawn:
Development and Production are clearly separated in pharmaceutical companies.
Both major functions work as silos with different organizational cultures and
mindsets. However, in advanced companies they are connected by special
organizations and teams. Such Transfer Organizations and launch teams are not
only important to ensure smooth transfer from Development to Production, but
also to bridge both functions on a less technical level.
A clearly defined approach to development and interface handling further
supports smooth transfer as well as cross-functional collaboration and exchange.
The chosen approach should not be biased in favor of one participant but rather
be beneficial for all functions in the same manner.
A general continuous improvement culture and mindset facilitates crossfunctional collaboration. Top management support is crucial for building up and
fostering such a culture.
Knowledge management grows increasingly more important, especially
considering

QbDs

growing

popularity.

However,

todays

knowledge

management only covers forward learning. Backward knowledge transfer and

general knowledge and know-how accumulation are very rare. Furthermore, no
holistic knowledge management solutions are in place. Todays systems rather
consist of different, not synchronized IT-supported tools. Thus, data exchange
and access are difficult.
QbD is becoming increasingly important, mainly because it also stands for a
more scientific and systematic way to drug development. However, its full
implementation demands for immense changes and resources. Therefore, the
chosen approach is to rather implement those parts with the most benefit first
and then decide whether further efforts are beneficial.

6 Design Characteristics of an Approach to Integrated

Development

This chapter introduces a descriptive model for integrated development. Insights from
the case studies and the industry survey refine the reference framework and transform it
into a descriptive model.
The first sub-chapter provides an overview of the benefits of integrated development
concepts. The second chapter presents the descriptive model built upon the reference
framework and findings from the empirical investigation as well as case study research.
Finally, in the third sub-chapter general conclusions are drawn.

6.1 Integrated Development as Facilitator

Summarized, the most important findings of both the industry survey and the case
studies are:
Despite on-going efforts to eliminate the clear boundary between Development
and Production, both functions still operate in silo-structures. Projects are often
organized across these two main functions and cross-functional teams exist, yet
the work is done individually without much consideration of what was before
and what follows after a certain process step.
Standardized approaches to development exist, but are often not strictly
followed. This in itself does not have to be inefficient, but often it is because
most surrounding company structures do not allow for such flexibility.
Knowledge management is recognized as an important topic and in many
companies efforts are undertaken to address this issue. However, a general
company internal way of thinking and learning as an organization as well as
acquiring and preserving knowledge does not exist. In terms of supporting
solutions, i.e. IT-based, it is often tried to build them on top of existing
structures, which inevitably leads to ineffective patchwork solutions.
To many people in the industry it is not clear whether QbD really is
advantageous and if so, what their advantages are. Therefore it is often

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Design Characteristics of an Approach to Integrated Development

approached with a certain reservation. The accompanying changes and benefits

are not yet recognized and embraced. One of the major hurdles to QbD is
knowledge acquisition and knowledge management. Both is often done already
to some extent and would only have to be brought in line with QbDs
requirements.
Generally, the predominant culture is not yet open enough. Understanding of the
concept of continuous improvement has not yet reached all parts of the
organizations. This can be considered as the key prerequisite for organizational
change to happen and to succeed.
As a result of these findings, integrated development is obviously a facilitator for more
effective development, transfer, and launch of new products as well as more efficient
production processes.

Figure 59 : Integrated development.

A structured concept adapted to a companys current set-up facilitates intensified

collaboration of both Development and Production and leads to the following processrelated or technical advantages:
1.

Manufacturing processes are not adapted as late as technology transfer; instead,

future manufacturing characteristics are considered earlier during process
development and scale-up.

2.

Early consideration of commercial manufacturing environment and equipment as

well as a more scientific approach to process development lead to more efficient
manufacturing processes.

3.

Efficient manufacturing processes have a direct positive influence on

manufacturing costs. In addition, less post-launch adaptations arise and process

Design Characteristics of an Approach to Integrated Development

111

improvements and optimizations are not needed during the first years of
commercial manufacturing.
4.

During emerging manufacturing issues support by development specialists is

more effective.

Implementation of such a concept comprises side-effects that are valuable for the
development of organizational properties:
1.

Boundaries are broken and silo-structures are eliminated by improved and

intensified overall intra-organizational collaboration.

2.

Learning and knowledge build-up are supported. Furthermore, knowledge

availability increases.

3.

More exchange between departments leads to higher social interaction between

employees.

4.

There is increased organizational learning.

6.2 Design and Configuration of Integrated Development

The insights from the industry survey and case studies lead to a review of the reference
framework. It is transformed into a descriptive model that is adapted to reflect practical
issues. This can assist managers to shape their individual approach of achieving high
integration in drug product development.

Figure 60: Transformation from a reference framework to a descriptive model.

112

Design Characteristics of an Approach to Integrated Development

The model is extended to also incorporate the important topic of knowledge management
and is now comprised of four main components (Figure 60): (1) The actual management
of the development process within integrated development approaches, (2) the
characteristics of the organizational set-up of involved organizations and departments,
(3) supporting and enabling success factors, and (4) knowledge management. Also, to
reflect a true management perspective, the component cross-functional collaboration in
the research framework is transformed into managing cross-functional collaboration
and deals with management aspects rather than with actual team composition.

6.2.1 Organizational Set-Up

Ideally, Development and Production are connected through an intermediate Transfer
Organization. If no such organization exists, its function can be taken over by launch
sites. They too have the knowledge about their capabilities and can represent commercial
Production in development projects. Due to this representing role, a Transfer
Organization is best organizationally affiliated with Production. It ensures close
collaboration with both the development as well as the commercial production side and
guides transfer projects through this tough environment. Furthermore, it bridges the
different mindsets of development and manufacturing engineers. This is achieved by
maintaining formal and informal relationships with both functions. It is beneficial for all
employees around this interface to be trained in other functions activities and
requirements; however, for the transfer group it is essentially important. This is easiest
done by working in another team for a period of time. In the end, it is better understood
what the previous or the following teams challenges and requirements are and thus the
own work can be adapted in order to better fit into the overall value chain.
Generally, process development is under Developments responsibility, whereas the
Transfer Organization is organizationally affiliated with Production. However, to avoid
too much influence of commercial production, the Transfer Organization should
maintain its independence and not report to a production or launch site.
Differently scaled development labs help during the scale-up process. As they are used
during early process development, it is favorable if they are under Developments
responsibility. However, their set-up should be closely aligned with launch sites or

Design Characteristics of an Approach to Integrated Development

113

commercial production. Moreover, the more commercial the scale is, the more they
should also be available to transfer group or even production engineers.
Launch sites are typically multi-purpose sites and are thus very flexible regarding
manufacturing capabilities. This is beneficial for product launches and can be used to
quickly start-up commercial production. Still, to maintain this flexibility, products
should be transferred to secondary manufacturing sites. In the case of a low degree of
alignment of manufacturing capabilities, this transfer can be very expensive. Therefore it
is important to have some level of harmonization across all manufacturing sites.
Development teams are organized as matrix-teams and thus truly cross-functional. It is
important that technical responsibility is always with the function or department leading
all work related activities. However, it is favorable for the overall project success that
responsibility during development projects does not change. This also prevents
knowledge loss and effort at responsibility hand-overs.

6.2.2 Managing Cross-Functional Collaboration

Generally, development projects are long-term projects and therefore need proper
management. One singular leader must be responsible for the overall project during its
entire lifecycle from early development up to launch. Ever changing general
responsibility hinders smooth project flow and fosters uncertainty in the different project
teams. This clear-cut responsibility and lead strategy is also reflected on the level where
the actual work is done. All activities, independent of whoever does the major work
share, are under clear responsibility: from the beginning up to technology transfer a
single representative from Development and from successful technology transfer until
launch a single representative from Production should assume responsibility.
All major teams during development projects are of course cross-functional. However,
their composition and the individual members involvement and contribution changes
with each sub-task. Figure 61 shows the generalized process steps and the team
members involvement according to important outcomes.
Early development activities, such as lab scale process development and final
formulation development, are all dealt with by Early and Late Stage Development
groups. All other functions, e.g. the Transfer Organization and the first manufacturing

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Design Characteristics of an Approach to Integrated Development

site, are kept informed. This way they can start to prepare their increasing involvement at
later stages.
When a project enters scale-up, meaning the transition from lab to pilot scale, first
considerations about the future manufacturing site must be made. Thus, the Transfer
Organization, in possession of the manufacturing sites capabilities and equipment, must
be involved when the first manufacturing site is determined and the manufacturing
strategy is developed. Traditionally, development engineers are influenced by research
and are therefore rather open to innovation and new technologies. Manufacturing
engineers on the other hand, know their existing and proven technologies and, for
economic reasons, rather want to use what already exists and what is understood.
Therefore it is important that both engineering groups discuss whether Developments
ideas can be operationalized on existing equipment and capabilities or whether new
technologies have to be built up. When manufacturing engineers are involved in
selecting new technologies and also see the advantages, they are more open to adopting
them. Moreover, the earlier technologies are built up, the more effective they can be used
in commercial production.
During full scale development it is important that the chosen first manufacturing site is
involved and contributes to the success of the project. This can be achieved by providing
either development capacity (e.g. commercial equipment) in a commercial scale
environment or knowledge about commercial scale behavior and properties. In the end it
is important that the outcome is a full scale manufacturing process that is adapted to
commercial productions capabilities and equipment. During this phase commercial
production gets ready for the following technology transfer: composing a manufacturing
engineering team, assigning capacities for technology transfer, adapting long-term
planning for commercial production after launch, etc.
Technology transfer is still under Development responsibility; however, it is functionally
led by the Transfer Organization. This organization is also coordinating the technology
transfer. Both Development and Production are collaboratively executing technology
transfer and conjointly manufacturing first evaluation batches at the first manufacturing
site. As this is the phase with the most exchange and where two different approaches
meet, it is most important that collaboration is fostered and the functionally leading
Transfer Organization coordinates and connects both functions. Developments goal
must be to transfer a nearly optimal full scale process with only minor needs of

Design Characteristics of an Approach to Integrated Development

115

adaptations, in order to successfully launch the product in the end. On the other hand,
Production also wants to take over adapted processes and thus sees the need of
collaboration also during earlier phases (e.g. pilot scale, as mentioned).
The following validation is under Production responsibility. It coordinates all efforts
between Development and Production. During validation a mixed team of Development
and Production validates the process at commercial manufacturing. This also helps to
build up further process knowledge.
Technically, Production is responsible for registration. However, the relevant work is
carried out by regulatory. Both Development and Production provide the data necessary
for successful registration. Technical aspects of the launch are done by commercial
production.
Post-launch improvements and changes are handled by engineers from commercial
Production. However, the Transfer Organization is coordinating the acquired knowledge.
It is passed on to Development and thus ensures company-wide learning. Moreover,
Development can directly benefit from such inputs as they can be applied in future projects.
It is important that all major hand-overs, i.e. from Early to Late Stage Development and
from Late Stage Development to the Transfer Organization or commercial production,
are considered carefully. Rather than one group finishing work and handing it over
abruptly, the goal is to collaborate around and across the interface. The closer a handover comes, the more the succeeding group is involved and exchange increases. Ideally,
some hand-over batches are produced conjointly. After the actual hand-over, the giving
group assists the receiving group by consulting. This involvement then decreases as the
receiving group acquires more knowledge. By applying this process adaptation the
interfaces will blur and the transfer will be seamless and smooth.
Other functions and departments are constantly informed and updated as the
development project progresses and masters milestones. They are involved when needed
and according to their expertise. For example: After the definition of the final
formulation, primary and secondary packaging development starts. Marketing is then
involved as they have all the market insights and knowledge about how to design
packages in order to reach optimal customer acceptance. Moreover, these other functions
often support processes secondary to technical development and are therefore not
explained in detail.

116

Design Characteristics of an Approach to Integrated Development

Figure 61: Proposal for optimal cross-functional collaboration in development projects.

Design Characteristics of an Approach to Integrated Development

117

Management of cross-functional collaboration does not only include management of

daily procedures, but also regular improvements and adaptations to the current approach.
This is best achieved by annual or bi-annual assessments of the current processes and
concepts. They traditionally cover questions such as: What has changed in the process?
Do changes in the process need adaptations in the concept? Where are the challenges in
the current approach? What could be improved in the current approach? It often results
in initiatives for process improvements or revisions of internal SOPs or guidelines. Such
initiatives are helpful in streamlining the organization to optimally fulfill its purpose.
However, it has to be considered that the resources available for assessments and
initiatives are linked to the company size: the bigger a company is, the more likely it is
that it can afford some fulltime employees dedicated solely to continuous improvement.
Smaller companies should instead foster a culture where every employee follows this
philosophy and continuous improvement is a natural part of the daily business.

6.2.3 Success Factors

Relevant success factors are best divided into organizational and technical factors. While
the first describe organizational requirements and behavior, the latter describe favorable
technical adaptations.
The most important success factors for integrated development and cross-functional
collaboration are top management support and a culture fostering cross-functional
collaboration. They both set the right environment for cross-functional teams to be
highly productive. Consistent support of cross-functional collaboration by top
management demonstrates the believe in cross-functional collaboration. Employees will
only take it over and follow this concept if they feel that it is indeed wanted and believed
to be the right path. Therefore top management has to demonstrate that despite a high
effort, cross-functional collaboration is the right way.
It is further important to define clear roles and responsibilities so that everyone knows
his/her part and no one feels lost in the process. Especially clear responsibilities are
crucial for successful transfers and hand-overs. Common goals and visions also help all
participants to see their part without losing sight of the overall goal. It is important that
the focus is not on the performance of individual contributions but on overall project

118

Design Characteristics of an Approach to Integrated Development

performance. This can be achieved by a common goal, e.g. to develop a technically

superior manufacturing process in order to hit the market with a better product.
Encouragement to work creatively may lead to new technology usage and by this to
improved manufacturing processes. However, it is crucial to discuss the adoption of new
technologies in collaboration with commercial production.
On the technical level there are two important success factors that can be summarized by
the term harmonization: equipment representing the first manufacturing site and
knowledge of first/launch manufacturing site capabilities and equipment. The first ones
benefit is obvious: alignment of equipment of development facilities and first
commercial manufacturing sites leads to easier transfer of processes from Development
to Production. However, this might be costly as each first manufacturing site needs a
development pendant. It is more efficient to harmonize critical equipment. At least the
Transfer Organization or commercial manufacturing engineers must possess knowledge
about first commercial manufacturing sites equipment and capabilities. This influences
the development during development of the manufacturing strategy and also improves
the transfer.

6.2.4 Knowledge Management

The more data is generated, the more important effective knowledge management
becomes. So far IT based knowledge management systems often are used in isolation in
single departments, e.g. both Early and Late Stage Development have their own
knowledge management solutions. They are not compatible and thus data exchange
constitutes immense efforts. As a consequence, knowledge created during one stage of
the process is often not available in another and thus company learning cannot occur.
Ideally, there is a single, integrated, holistic, and IT based knowledge management
system spanning the entire development process. Each user has access according to its
function. All relevant data is entered into the system and thus preserved.
Insights and scientific data can be re-used and replication of efforts can therefore become
obsolete. It also ensures the back-transfer of knowledge acquired in commercial
manufacturing. An effective knowledge management helps build an immense scientific
data base. This is also beneficial for QbD, as over time a lot of data will already be
available and thus development is accelerated and the scientific understanding increased.

Design Characteristics of an Approach to Integrated Development

119

Moreover, effective knowledge management enables organizational learning and the

organization becomes less dependent on knowledgeable employees.
However, very few companies are in the situation where they can dismiss their current
different knowledge management solutions and instead implement a new one. To
improve the usage of existing solutions, it is important to enhance data exchange.
Furthermore, when solutions are replaced, one should consider an already existing
solution. Although requirements are different by all users and departments, a solution
optimal to all should be implementable.

6.3 Conclusion
In a successful approach to integrated development in the pharmaceutical industry,
development projects follow a formal process with clear roles and responsibilities.
Process development is under responsibility of Late Stage Development. Ideally, a
Transfer Organization exists, belonging to the Production department and thus really
representing productions capabilities. The Transfer Organization is involved in process
development and represents the commercial manufacturing or launch site. Thereby it is
assured that the environment, equipment, and capabilities of commercial production are
considered and processes are specifically developed to be efficient in commercial
production. The Transfer Organization takes over responsibility from Development after
successful technology transfer. As soon as commercial production is established,
responsibility is transferred from the Transfer Organization to routine production. The
Transfer Organization becomes active again in case the production is transferred to a
secondary site at a later stage.
Top management commitment and an organizational climate fostering cross-functional
collaboration are important for successful concepts. Thereby all needed resources are
available and employees are encouraged to collaborate with other departments.
Furthermore, common goals and visions are important for development project success,
to eliminate silo-thinking and to foster individual interest in overall project success. This
overall team and project performance can also be rewarded. The more equipment and
capabilities of development and commercial production are aligned, the smoother the
transfer runs. Harmonization efforts further increase process stabilization.

120

Design Characteristics of an Approach to Integrated Development

Not yet widely established but crucial are singular, integrated knowledge management
solutions. They help to build up and preserve valuable knowledge, which can then be reused for new development projects, speeding up development time and decreasing
efforts. However, it is important that there is only one system in place, and that data is
available to all responsible employees at all time. This knowledge can then also be used
to resolve manufacturing issues. A scientific approach to development is based on an
accessible, large amount of data and empowers preventive process stabilization.
Generally, it is highly beneficial to establish a culture and common understanding of
continuous improvement philosophy throughout the company. This means all employees
on all levels act towards the goal of increasing effectiveness and efficiency of all
processes. To achieve such a general mindset of continuous improvement, it must be
demonstrated by leaders. Furthermore, employees must be trained in order for all to
share the same understanding and to see the benefits. If it is routine to regularly question
the current way, what has changed, and what could be improved, a true culture of
continuous improvement is established.

7 Summary and Outlook

This chapter concludes this thesis by summarizing theoretical and managerial

implications. The research findings extend the current theory about integrated
development both in a general and in an industry-specific way. Also, known limitations
do exist and are listed in the third sub-chapter. The forth sub-chapter gives an outlook
where further research is possible for future scientists.

7.1 Theoretical Implications

As mentioned in the introduction of this thesis, an overall model for integrated
development in the pharmaceutical industry is missing. A theoretical and practical model
is introduced by this research, building upon existing approaches found in literature and
adapted

according

to

empirical

findings.

The

model

contributes

to

the

R&D/manufacturing interface, integrated development, and literature on cross-functional

teams.
Furthermore, literature about integrated development and cross-functional collaboration
is extended with empirical data from an industry survey and two case studies from the
pharmaceutical industry. So far, this industry was underrepresented in literature.
Operationalization of a measurement for both integration and performance of newly
launched manufacturing processes is introduced. Especially the empirical findings
demonstrate a correlation of these two indicators. This leads to research finding 1a:
Research finding 1a: The higher the degree of integration, the higher the performance of
newly launched manufacturing processes.
In fact, all participating companies with high level of integration did perform better
regarding process development and thus were able to transfer better and more efficient
manufacturing processes from development to commercial production. As a
consequence thereof, Production was involved earlier in the development process. This
is stated in research finding 1b:

122

Summary and Outlook

Research finding 1b: The earlier production is integrated into the development process,
the higher the process development performance is.
This finding is tightly connected to the first finding and extends it further. The high
performing companies all showed very early integration: a gradual increase of
production involvement and final complete hand-over after technology transfer.
Improvements after launch were also found to be very integrated, meaning Development
was again involved and could thus also learn for future projects.
Earlier involvement of production requires excellent coordination. A Transfer
Organization can exhibit this function and operate as a bridge connecting Development
and Production. It can be an organization on its own or this role can be taken over by
launch sites. From the importance of this function, research finding 2 is derived:
Research finding 2: To bridge Development and Production, a Transfer Organization is
needed.
Existing known success factors critical to integrated and cross-functional development
are tested and in some cases found to be highly relevant for the pharmaceutical industry
as well. However, others do not apply to this specific industry, or at least their effect is
not as expected from examples of other industries. From this, research finding 3a is
formed:
Research finding 3a: The four organizational success factors top management
commitment, organizational culture fostering cross-functional collaboration, common
goals and visions, and clear roles and responsibilities are most influential.
Contrary to expectation, team co-location and formal knowledge transfer process proved
to be negligible for high process development performance in the pharmaceutical
industry.
Additionally, an additional group of success factors, i.e. technical success factors, is
introduced and their importance demonstrated. Especially equipment harmonization is a
perspective not considered in literature so far and thus generally extends theory. It forms
research finding 3b:
Research finding 3b: Harmonization and knowledge about capabilities are crucial
technical success factors.

Summary and Outlook

123

Moreover, knowledge management, in literature often found as another success factor, is

demonstrated to be very important for pharmaceutical development. Therefore it is
elevated from yet being solely a success factor to being a substantial part of integrated
development. This most likely also applies to other industries. It is stated in research
finding 4:
Research finding 4: Effective knowledge management enables learning and is thus
crucial to successful process development.
In addition, theory about QbD implementation is extended by a general model on how to
shape development in a way suitable for QbD and its intense demand for data.

7.2 Managerial Implications

This research is derived from managerial problems observed at manufacturing
pharmaceutical companies (with development activities) and therefore research results
are practice-relevant and applicable. The developed descriptive model can serve as a
management model for the implementation of integrated development in the
pharmaceutical industry.
It is important that activities and initiatives concerning internal transformation are based
on a holistic system. The model proposed in this thesis covers organizational, process,
and management aspects as well as accompanying success factors.
As managers embrace learning from other managers experiences, the following
recommendations are enriched with topics from discussions and workshops conducted
with participants of the industry survey and the management of the case studies
companies. These recommendations for managers are clustered into the following five
groups:
Organizational Set-Up: It is important that the organizational set-up follows the
concept of integrated development. Therefore, it is advisable to install an
independent Transfer Organization connecting Development and Production.
Furthermore, silo-thinking of both Development and Production departments
must be avoided by fostering conjoint activities during development projects and
later adaptations of commercial manufacturing processes.

124

Summary and Outlook

Management of Cross-Functional Collaboration: Effective management of

cross-functional collaboration needs clear responsibilities. Ideally, one single
person is responsible for a project from beginning to end. Also, involvement of
manufacturing specialists, either from the Transfer Organization or commercial
production, must start as early as a manufacturing strategy is being developed.
From then on, collaboration must slightly be increased until technology transfer,
when the official transfer from Development to Production occurs. Following
this transfer, Developments involvement decreases continually. Furthermore,
management should regularly start initiatives with the clear goal to analyze the
current set-up, find improvement potential, and really improve the current
approach.
Success Factors: It is most important to create an organizational environment
fostering cross-functional collaboration. Top management support functions as
empowerment of employees to embrace cross-functional collaboration and to see
its benefits. This is most likely achieved by building a shared base of
understanding of cross-functional collaboration and integrated development and
by demonstrating its positive effects with so-called quick wins or lighthouse
measures: simple activities towards integration show its obvious benefits, e.g.
involvement of production during development of manufacturing strategy leads
to a strategy for commercial manufacturing truly considering existing
capabilities, equipment, and technologies and therefore eliminates later
surprises. Furthermore, managers should consider a high degree of
harmonization

between

development

facilities

and

first

commercial

manufacturing plants. If this is not possible due to too many sites or limited
resources, at least detailed information about capabilities, capacities, equipment,
and technologies of each commercial manufacturing plant should be collected
and taken into account early during development.
Knowledge Management: Knowledge management proved to be increasingly
important. Todays more scientific approach to development generates immense
amounts of data. It is only efficient to collect them all if they are made accessible
for other projects. Therefore management should implement a single, integrated,
and holistic knowledge management solution. Such an effective system increases
the value of knowledge by making it highly re-usable and therefore generating
potential to eliminate previously performed experiments.

Summary and Outlook

125

QbD: Crucial for QbD implementation is the generation of data that can be reused for future development projects. A growing scientific data base unfolds
QbDs potential as its initially high efforts (mainly for data generation) decrease
significantly. Whether management should aim for QbD-submissions cannot be
answered and is probably a question of a companys philosophy. However, even
if QbD is used for internal purposes only, it greatly increases process
understanding and fosters the scientific approach to development.

7.3 Known Limitations

There are some limitations known to the research presented in this dissertation. The most
prominent is of course the focus on the pharmaceutical or life sciences industry. As this
may hinder other industries from adopting presented concepts and strategies, it was also
unavoidable to have this focus: This way, a specific process 100% representative for the
pharmaceutical industry could be investigated. Had there not been an industry focus, the
results would be rendered unusable due to the high generality and low specificity. Also,
the research on QbD is by definition industry focused.
The industry focus can again be brought up as a second limitation: The focus implies the
pharmaceutical industry to be homogenous, when in fact there are differences between
e.g. the generics, biologics, or traditional pharmaceutical industry. However, they all
share the key concepts of high regulation as well as the proceedings of the development
process.
In general, the research of this topic was difficult due to the immense duration of
development projects: They could not be accompanied from beginning to end, instead
single representative projects were re-created from industry experts experiences and
knowledge. Furthermore, activities and concepts in development are often considered as
competitive advantage and therefore underlie high confidentiality. Thus many interested
industry experts decided not to take part at all or only with assured anonymization.
However, the quality of presented results is thereby not affected at all and many industry
representatives confirmed the findings.
In particular, the method used for the internal surveys has some disadvantages that
constitute minor limitations: General data was gathered by conducting semi-structured
interviews and workshops with persons directly involved in drug product development.

126

Summary and Outlook

Furthermore, data representing the current situation regarding cross-functional cooperation was gathered by internal surveys. Therefore a RACI-matrix-style questionnaire
listing all process steps as well as participating functions was widely distributed to
representatives from Development, Production, and other functions within Pharmaco1
and Pharmaco2. Participants provided information to what degree or amount they are
involved in certain process steps along drug product development. A clear advantage of
this method is that all involved functions get a chance to describe the situation from their
point of view. However, the main disadvantage is that there is no agreement in the end.
There is not one single collaboration and involvement process for the participating firm,
but rather multiple different versions, all to some extent biased by the participants.
However, significant discrepancies in single process steps can be taken as problem
indicator. Usually, after discussion, it turns out that some participants have either used a
different definition of that particular process step, some participants have not filled out
the way it is in reality but rather in theory (which indicates that either theory or
execution has to be reviewed), or that some participants do not know the theory and have
not yet adapted to it. The result is either adaptation of the theory or education and
training of the desired state. It also has to be taken into account that all results are mere
perceptions of the individual participants.

7.4 Further Research

The main research question is answered by answering all sub-questions. However, the
research presented in this dissertation is by far complete. Following four areas are
proposed, each extending the research topic in a different direction.
1.

The pharmaceutical industry can be divided into the generics, biologics, and
traditional pharmaceutical industry. They all share a very similar development
process, but there are also some minor differences. Investigations of all three
sub-industries could reveal differences or similarities in the way cross-functional
collaboration is organized. Furthermore, it could be that each sub-industry has
unique combinations of success factors driving efficiency.

2.

So far very few pharmaceutical companies have holistic and integrated

knowledge management solutions in place. Therefore efficient implementation is
not known. This could be investigated and taken even further: What is the effect

Summary and Outlook

127

of integrated knowledge management and thus company learning abilities on

development performance? As proposed in this dissertation, it is expected that
effective knowledge management has a tremendous beneficial influence on
development performance.
3.

QbD is still not very widespread in the industry. A holistic investigation of how
to implement it, what resources are needed, and what the real benefits are would
certainly help, in case it is favorable for QbD implementation, to increase its
popularity. There exist studies in some of these fields; however, to date it has not
been researched in a holistic approach.

4.

Integrated development is an established concept for some industries. However,

there are also industries, like the pharmaceutical industry, where development is
integrated only to a very small degree. Research could be undertaken to identify
whether existing concepts are easier to transfer to other industries compared to
the pharmaceutical industry. Furthermore it could be investigated, whether the
concepts used for adoption of integrated development by the pharmaceutical
industry presented in this dissertation could facilitate adoption by other
industries.

Concluding, it is believed that this research is highly relevant to both management

practice and management theory. The latter is significantly extended through the holistic
model for integrated development. This research can serve as a starting point for future
scientists aiming at supporting pharmaceutical companies in increasing effectiveness and
efficiency of their development process through integrated development.

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Curriculum Vitae

Name:

Reto Marc Ziegler

Date of birth:

April 21st 1983

Place of birth:

Basel, Switzerland

Education
2008 2013

University of St.Gallen, St.Gallen, Switzerland

Doctoral programme Management - Business Innovation

2007 2008

University of Basel, Basel, Switzerland

Master of Science (M.Sc.) in Molecular Biology, Major in
Molecular and Developmental Immunology

2004 2007

University of Basel, Basel, Switzerland

Bachelor of Science (B.Sc.) in Biology, Major in Molecular
Biology

1993 2002

Gymnasium Kirschgarten, Basel

High-school studies, specializing in Latin (Matur, Typus B)

Professional Experience
2008 2013

Institute of Technology Management, St.Gallen, Switzerland

Research Associate

2007 2008

Center for Biomedicine, Basel, Switzerland

Master thesis (M.Sc.) in Molecular Immunology

2001 - 2006

iRIX Software Engineering AG, Basel, Switzerland

Software Developer

2002 2004

Novartis Pharma AG, Basel, Switzerland

IT Support