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MAXLife ERP | White Paper
1 Managing Quality and Compliance: Life Sciences ERP Software
Managing Quality and Compliance:
Life Sciences ERP Software
MAXLife ERP | White Paper
MAXLife ERP | White Paper
2 Managing Quality and Compliance: Life Sciences ERP Software
TABLE OF CONTENTS
Background ………………………………………………………………………………………………………………………….. 3
Key Life Sciences ERP Features …………………………………………………………………………………………….. 4
Electronic Batch Records / Electronic Device History Records ……………………………………….. 4
Quality Document Management Portal ………………………………………………………………………….. 5
Corrective and Preventive Action (CAPA) ……………………………………………………………………….. 5
Material Control and Traceability …………………………………………………………………………………… 6
Training and Certification Management ………………………………………………………………………… 7
Cost of Quality Management …………………………………………………………………………………………. 8
Audit Trials and Electronic Signatures ……………………………………………………………………………. 9
Software Validation ………………………………………………………………………………………………………... 9
Conclusion ...………………………………………………………………………………………………………………………... 10
About Us ……………..……………………………………………………………………………………………………………... 11
MAXLife ERP | White Paper
3 Managing Quality and Compliance: Life Sciences ERP Software
BACKGROUND
The Life Sciences industry is often considered a leader when it
comes to the utilization of new, innovative technology to drive
major advancements in R&D. However, we have found that when it
comes to inventory, manufacturing, and supply chain management
business processes – many Life Sciences companies still find them-
selves buried in paper or using 20 year old technology.
While regulatory reporting and compliance requirements historical-
ly drove these organizations to work manually with paper, there
have been many advancements in software technology that should
be too compelling to ignore. Unfortunately, once manual, paper -
based, and legacy systems are in place, executives tend to stay with
these systems in order to stick with their “tried and true” ways of
working. And once they are awash in paper, these companies are so
consumed in managing paper trails that they cease to see how crip-
pled their operations really are.
By maintaining the status quo, these companies are ignoring the
significant cost savings, efficiencies, and competitive advantages
that new, innovative Life Sciences ERP systems can provide.
The obvious challenges with historical paper-based processes and
systems are that they take a great deal of time, effort, and space to
manage and maintain. Then take into consideration the added risk
of human errors, overlooked requirements, and forgotten process-
es. And don’t forget about the raw materials and finished products
sitting in the warehouse waiting for manual and paper-based pro-
cesses to be completed. This represents tied up working capital and
fewer inventory turns.
MAXLife ERP | White Paper
4 Managing Quality and Compliance: Life Sciences ERP Software
All of this adds up to higher costs and lost profits.
KEY LIFE SCIENCES ERP FEATURES
Executives who recognize these challenges are using Life Sciences
ERP Software to achieve compliance, eliminate costly paperwork
errors, speed up information distribution and collaboration, and
enable strategies for improving product quality and process effi-
ciency.
Electronic Batch Records (EBR) / Electronic Device
History Records (EDHR)
Many Life Sciences companies today still rely on paper-based pro-
cesses to document every step in production to comply with GMP
or FDA regulations. There are many disadvantages to this ap-
proach, including: increased operating costs, higher corporate risks,
slower and inefficient manufacturing processes, and limited data
visibility.
Electronic Batch Records and Electronic Device History Records
provide Life Sciences companies with an electronic way to efficient-
ly document any procedure, process, transaction, journal, COA, for-
mula or recipe in a way that is compliant with 21 CFR Part 11 Reg-
ulations.
EBR / EDHR systems should have built-in full document lifecycle
capabilities, complete with automated workflows, audit trails, elec-
tronic signatures, approvals, versioning, and archiving. When imple-
mented properly, EBR / EDHR systems can do all of this without
paper printouts.
Up to 30%
Productivity increase
by removing manual,
paper-based
processes
- Nucleus Research, 2010
In January 2010, Nucleus
Research found that users
moving from disparate and paper
-based systems could expect user
productivity to increase by up to
30% simply by moving to
Microsoft Dynamics AX.
MAXLife can amplify this
increase for life sciences
companies by also removing
paper-based processes around
quality control, compliance, and
electronic document
management.
MAXLife ERP | White Paper
5 Managing Quality and Compliance: Life Sciences ERP Software
Quality Document Management Portal
Two of the biggest operational risks for Life Sciences companies
are compliance with 21 CFR Part 11 and Part 820 regulations. Fail-
ing to adhere to these regulations can hinder shareholder confi-
dence, erode your bottom line, and cause irreparable damage to
brand equity. As a result, many regulated companies seek to imple-
ment enterprise-wide compliance and quality document manage-
ment solutions that can quickly address customer and regulatory
issues consistent with worldwide requirements, while simultaneous-
ly being leveraged to automate and enhance business processes.
Although many solutions claim 21 CFR Part 11 compliance sup-
port, the cost of these systems is often prohibitive for all but the
largest Life Sciences organizations. At the same time, many solu-
tions are difficult to deploy and even harder to use, which further
limits their ability to create compliant-environments quickly and
effectively.
Life Sciences companies need an integrated quality document man-
agement solution with full document management lifecycle capabili-
ties, including automated workflows, audit trails, and full versioning
support. The document management solution needs to help compa-
nies address the regulatory requirements of FDA 21 CFR Part 11
and Part 820, as well as SOP management, clinical document man-
agement and a range of quality functions including CAPA, audits
management, non-conformance and complaint management!
Corrective and Preventive Action (CAPA)
Life Sciences companies are required to detect and react to inci-
dents and non-conformances and ensure that appropriate actions
$3,085,000
Total potential
annual savings of
document
management
- Aberdeen Group, Jan 2012
Cost of document capture:
19 cents per document x 1.5M
documents = ($285,000 per year)
vs.
8 cents per doc and $120,000 per
year
Savings of $135,000 per year!
Error Remediation:
22 errors per 1000 x $3 to fix an
error = $990,000 per year
vs.
10 errors per 1000 equals
$450,000 per year
Savings of $450,000 per year
Time spent on Document
Capture:
4.1 mins per document x 102,500
man hours x 51 FTE = $3M in
salary / benefits
vs.
45 second per document x 18,750
man hours x 9.4 FTE = $564,000
in salary / benefits
Savings of $2.5M per year
MAXLife ERP | White Paper
6 Managing Quality and Compliance: Life Sciences ERP Software
are taken to correct current and prevent future occurrences. Still,
more than half of the FDA Form 483 observations and warning let-
ters cite Corrective Action / Preventive Action (CAPA) incident
management deficiencies.
Every Life Sciences company needs to have an effective CAPA sys-
tem in place to minimize risk and ensure compliance with regula-
tions, but maintaining an effective CAPA process can be challeng-
ing. Challenges can occur at every step of the CAPA process and it
requires vigilance to ensure that they don't derail the process and
expose the company to unnecessary or excessive risk.
The biggest challenge Life Sciences companies find themselves
caught with is a silo’d CAPA system (or multiple CAPA systems) in
which the data in the CAPA system(s) cannot be effectively shared
across the company or cross-referenced with other data. This makes
it hard for companies to link related problems – and even harder to
generate metrics and perform trend analysis on elements like prod-
ucts, problem types, root causes, costs, and more. These companies
need to break down their CAPA silos to achieve a single, managed,
integrated and complete view of the process - and enable a common
way for them to do trending and put preventive action in place
across the company.
Material Control & Lot Traceability
Life Sciences product recalls are not predictable - they can happen
at the best of times, or the worst of times. At any given moment,
companies must be able to quickly and effectively recall products
that have been deemed unsafe for the market. How a company re-
sponds to these situations is critical: failure to handle a recall suc-
2012 FDA Statistics:
9,469 recalled products
4,075 recall events
4,882 warning
letters
17 injunctions
8 seizures
20 debarments
FDA Warning Letters:
Recalled Products:
Source: U.S. Food and Drug
Administration, 2012
MAXLife ERP | White Paper
7 Managing Quality and Compliance: Life Sciences ERP Software
cessfully (either voluntary or mandatory) can have serious economic
and legal consequences. With the ever increasing levels of press and
public backlash associated with consumer safety and product re-
calls, it is becoming even more important for FDA-regulated com-
panies to have preventative tools and controls in place to monitor
quality, measure the potential impact of any quality incidents, and
quickly and effectively perform investigations.
This is not to say that all Life Sciences companies must have end -to
-end Life Sciences ERP or recall management systems. In fact,
there are more companies running on spreadsheets and manual pa-
per processes than on industry-specific ERP. However, as these
companies grow, as their business processes and supply chains be-
come more complex, as customers become more demanding, and as
regulatory compliance becomes increasingly stringent - it will be-
come more difficult for these companies to manage the two key re-
quirements for a good recall process: recall accuracy and response
time.
Recalls are expensive - both in terms of product cost and brand /
reputation damage. Having the right systems and processes can ena-
ble companies to minimize the costs of a recall, and prevent further
damage. Unfortunately, many companies today do not have ade-
quate systems in place and are putting their company at unnecessary
risk.
Training and Certification Management
Constantly changing government regulations force Life Sciences
companies to employ and continually train highly skilled and quali-
fied team members in order to maintain compliance and ensure
$30,000,000
Estimated financial
impact of a recall in
the past 5 years, as
identified by 77% of
respondents
- Ernst & Young, 2011
In the report, E&Y found that a
recall, particularly a “Class I,” or
health and safety recall, is usually
a significant event for a consumer
products company. For
companies that have faced a
recall in the past five years, 77%
of respondents estimated the
financial impact to be up to $30
million dollars; 23% reported
even higher costs.
MAXLife ERP | White Paper
8 Managing Quality and Compliance: Life Sciences ERP Software
product safety. This requirement for a skilled workforce creates
higher costs in salaries and benefits - and also is a contributing fac-
tor to the turnover rates Life Sciences companies experience.
Technology platforms can play a critical role in reducing a Life Sci-
ences company’s training costs while streamlining and speeding the
employee onboarding process. Training and Certification Manage-
ment systems make it easier to track employee training and pro-
gress, maintain employee certifications, perform training assign-
ments while tracking and archiving results, and implement employ-
ee quizzes and surveys.
Life Sciences companies that rethink their learning, training, and
onboarding strategies and put in place systems and processes to
drive continuous learning will develop and maintain a competitive
advantage.
Cost of Quality Management
Most executives believe that their company's Cost of Poor Quality
is less than 5% of gross sales, or just do not know what it is. In re-
ality, experts estimate that the COPQ can amount to 30% of gross
sales for Life Sciences manufacturers. Independent studies also re-
veal that COPQ is costing companies millions of dollars each year
and its reduction can transform marginally successful companies
into highly profitable ones.
We believe that a company can significantly reduce the total cost of
quality by as much as 50% simply by implementing software that
automates quality management and regulatory compliance process-
es, and tracks the costs of quality tests, investigations and correc-
tive and preventative action steps associated with quality incidents.
$130 Billion
Global corporate
spending costs for
training last year—up
9.5% from 2011
- Bersin by Deloitte, 2012
MAXLife ERP | White Paper
9 Managing Quality and Compliance: Life Sciences ERP Software
This feature provides companies real-time visibility into their com-
plete product costs, including important quality processes, enabling
them to make better decisions timelier.
Audit Trails and Electronic Signatures
Life Sciences companies must have very tight control over data in-
tegrity and security. Although corporate governance has largely
been portrayed as an issue of compliance, analysts and business
leaders increasingly are seeing good governance as good business.
Sound corporate governance can reduce market volatility, encour-
age investment and promote sustainable productivity and growth.
The push today is toward putting into place a combination of inter-
nal controls, explicit businesses processes and risk management
systems for corporate governance that can also build business
value.
An Audit Trail system provides tracking, tracing, and reporting ac-
countability capabilities that enables Life Sciences organizations to
capture and archive changes to all electronic data and documents
required for maintaining regulatory compliance. Electronic Signa-
tures help organizations improve security and enhance data valida-
tion with preventative controls that can be activated at any place in
the system where data is changed. Before they can change data,
Electronic Signatures presents employees with a window that re-
quires authorized user identity information.
Software Validation
The FDA defines validation as “a process of demonstrating,
through documented evidence, that <software applications> will
consistently produce the results that meets predetermined specifi-
Second
Reducing Cost of
Quality was identified
as the second most
important pressure
facing executives.
- Aberdeen, 2008
MAXLife ERP | White Paper
10 Managing Quality and Compliance: Life Sciences ERP Software
cations and quality attributes.” Although the principle of software
validation is simplistic, the application of these principles in real
life tends to be daunting, time-consuming, and expensive.
For many years, validation engineers struggled with manual, paper
based processes while conducting validation exercises. Today's
technological advances have made it easier and more practical than
ever to implement, validate, and deploy enterprise Life Sciences
ERP systems. Software validation tools can streamline and auto-
mate traditional validation processes, including test script develop-
ment, validation testing and validation reporting.
CONCLUSION
Many Life Sciences companies still find themselves struggling with
disparate systems, legacy applications, paper-based processes, and
redundant data entry. Unfortunately, business processes driven by
manual processes or old ERP become constrictive and hinder most
companies from profitably scaling, growing and expanding, and
efficiently adapting to constantly changing business demands.
In order to maintain quality and profitability in such a competitive
market, Life Sciences companies need to reduce the manual pro-
cesses that hinder productivity and automate and streamline stand-
ard methodologies for quality and compliance processes. Lot trace-
ability, QA testing, product change controls, FDA compliance, and
managing product formulas are all examples of the many challenges
Life Sciences companies face every day in order to run their busi-
ness.
Life Sciences ERP software can help reduce the time and effort
required to maintain FDA compliance and enable companies to fo-
$6.2 Trillion
Worldwide cost of IT
failures - making it
critical to work with
trusted partner.
- Roger Sessions, 2009
Key Validation Deliverables:
Validation Plans
Risk Assessments
Requirements Specifications
Validation Test Plan
Migration Plan
Disaster Recovery Plan
Installation Qualification (IQ)
Test Scripts
Operational Qualification (OQ)
Test Scripts
Performance Qualification (PQ)
Test Scripts
Trace Matrix
Validation Test Script Execution
(IQ/OQ/PQ)
Automated Validation Testing
Validation Summary Document
Other documents as required by
the client
MAXLife ERP | White Paper
11 Managing Quality and Compliance: Life Sciences ERP Software
cus more time and effort on producing the highest quality products
and speeding time-to-market. Today’s industry leaders are using
Life Sciences ERP Software to achieve compliance, eliminate costly
paperwork errors, reduce operating costs, speed up information
distribution and collaboration, and enable strategies for improving
product quality and process efficiency.
ABOUT MAXLife ERP
MAXLife is based on Microsoft’s most advanced and feature -rich ERP
system, Microsoft Dynamics AX, and extends the solution to help Life
Sciences companies improve product quality and safety, reduce organiza-
tional risk, and maintain FDA compliance. By utilizing MAXLife ERP,
Life Sciences companies can automate, grow, and transform their busi-
ness with innovative, high quality business process and IT consulting ser-
vices designed specifically for FDA Regulated companies. MAXLife has
passed the Software Solution Test for Microsoft Dynamics AX, which is
a major requirement for Certified for Microsoft Dynamics® (CfMD).
ABOUT MERIT SOLUTIONS
Merit Solutions is a focused-strategy business process consulting and IT
services company with a goal of being the very best at helping clients au-
tomate, grow, and transform their business using enterprise technology
solutions. Our preference has always been to be deep, not wide, in what
we do for clients, and to provide an overwhelming value for cost rela-
tionship that makes it easy for them to use our services repeatedly. Our
clients are medium to global enterprise businesses that want to leverage
Microsoft Dynamics and surrounding technologies to standardize busi-
ness processes and eliminate risk - and then continuously improve their
business. With more than 800 clients representing over a dozen indus-
tries spread worldwide, our longevity and success within the Microsoft
technology is proven.
100%
of customers likely to
recommend and / or
repurchase from
Merit Solutions.
- Microsoft CSAT Scores, 2012
Merit Solutions, Inc.
We know our success is directly
dependent upon the success of
our customers - so we go out of
our way to make sure our
Customers are completely
satisfied with the work we've
done.
Our clients understand the value
of working with a trusted partner.
More importantly, they
understand the potential risks and
costs associated with failed or
drawn out business
transformation projects that are
the result of working with the
wrong business partner.
See our Satisfaction Scores.
Contact us to learn how we
can help transform your Life
Sciences quality and control:
1749 S Naperville Rd., Ste. 200
Wheaton, IL 60189
+1 630-614-7133
www.meritsolutions.com