Outsourcing APIs And GMP Consulting
In the past decade, many pharmaceutical companies have outsourced ingredient production to Asian countries including China and India in the hope of lowering production costs and increasing profits. But now GMP Consulting firms are seeing companies move this production back onto US soil. The reasons behind the move back to the US are varied and they will be discussed in this article.
Pharmaceutical companies believed they were getting a good deal as they outsourced the production of Active Pharmaceutical ingredients or APIs to Asia. Production costs like labour and premises rent is better value than in the US. However, now manufacturers are beginning to realise that there are many costs and logistical issues which make this outsourcing more expensive than first thought.
Problems With Quality
Ever since a contaminated batch of Heparin entered the US market and was responsible for the deaths and illness of hundreds of people across the nation, the quality of Asian imports has been in doubt. And we have seen a bigger demand for quality products made on American soil from consumers, healthcare professionals and the pharmaceutical companies. US manufacturers are forced to produce ingredients of the highest quality because they are subject to thorough GMP regulations.
Logistics
Oversees outsourcing requires a massive amount of logistics to be in place and they can cost a lot of money. And now the pharmaceutical companies are truly beginning to realise the true cost of this outsourcing. There are costs for employing solicitors, for hiring offices and for travel. You are looking at very expensive additions when you factor these in to the standards costs of outsourcing.
Communication Problems
Translation is often the most difficult factor to overcome when you use a foreign company to produce ingredients. And when you can barely get through a daily conversation without becoming confused, how are you supposed to clearly convey technical information. Manufacturers also need to factor in the time it takes for communication to occur between two different countries which are in a different time zone. You are putting your company at a poor position when you have to wait for time zones to align in order for you to be able to communicate with your suppliers abroad.
Now that the production of APIs has been outsourced to Asia for a number of years, the massive financial windfalls that companies expected have not proved to be realistic. GMP consultants are seeing that companies can make a bigger profit by guaranteeing their customers high quality drugs that comply with FDA and GMP regulations.
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