As the pharmaceutical industry embraces the Electronic Common Technical Document (eCTD) standard for drug licence submissions, companies with foresight are seizing this as an opportunity to streamline their internal submissions-related processes to achieve multiple gains.
Drug licence submissions are a necessary evil for the pharmaceutical industry. Fall foul of stringent industry specifications and your company could be closed down. Getting the processes and documentation right is paramount.
Yet processing paperwork is hardly core business for experts in science. An integral activity it might be, but it is a rare pharmaceutical enterprise that sees efficient process-logging as a competitive differentiator. Instead, the discipline is laborious, resource-intensive and costly and is something most pharmaceutical companies would gladly offload to a third party if only they could make that final leap of faith required to let someone else co-manage it.
Remote systems become the norm
The good news is that this has now become much easier. Worldwide, cross-industry acceptance of the benefits of centralising and remotely hosting IT systems, and buying software functionality as a service, using the now accepted Software as a Service (SaaS) sourcing model, is giving organisations unprecedented freedom in the way they prioritise and manage their business operations.
With access to broadband communications now taken for granted, and network security now so integral to companies’ IT infrastructures, organisations large and small are taking the opportunity to move out and centralise their systems, so that these can be managed more cost-effectively, properly secured, and shared more readily. The benefits and practicalities of hosting email servers and other core applications remotely are now taken as a given, to the point where this is becoming common practice even in markets sectors once considered overly conservative and risk-averse, such as financial services and government.
Indeed, respected global analyst firm Gartner Group believes that the SaaS model of software delivering will become the sourcing model of choice by 2008, with more than 50percent of all software purchases being made on a subscription rather than licence basis.
The pharmaceutical industry provides no exception to the growing interest in on-demand software, itself now starting to embrace the opportunity as a means of unburdening itself of some of the regulatory commitments to which it is bound.
While relinquishing control is out of the question, the opportunity to let external experts host and even co-manage the submissions process is a welcome one.
Relieving the burden
Using the familiar interface of the web, yet passing through many layers of security, users can access, work on and share documentation from their office desks as usual. The difference is that the company no longer needs to own and the software, or even many of the processes involved in managing a licence submission.
Organisations’ ability to benefit from the associated cost efficiencies need not begin and end with licence submission, either. Professional managed services are now available to support every function, from clinical trials to post-submission tracking.
Given the immensity of the molecule-to-market drug development lifecycle, and the relatively sporadic need for different software systems at different stages within this, remotely hosted on-demand software enables companies to switch on and pay for the functionality they need only when they need it.
The rest of the time, instead of lying dormant and incurring support and possible upgrade costs, the software is simply ‘switched off’, remaining someone else's responsibility.
Vast savings
The cost benefits alone are enormous. Whereas in the traditional software purchase scenario, every US$1 spent on a software system typically generates a further US$3 in administration and support costs, these figures are radically reduced with the SaaS model. With access to exactly the same functionality, yet none of the associated headaches, organisations eliminate each US$1 in ownership costs along with US$2 of the US$3 spent on support. Instead, they pay a nominal set-up charge, and a modest and predictable pay-as-you-go service charge. This could amount to savings of hundreds of thousands of Euros for some companies.
Speed to market is a substantial advantage, too. Organisations implementing their own software systems internally may have to wait six to 12 months before a new system has been specified, fully validated and rolled into production, which for many will be too long. In the US, for example, where organisations are rushing to comply with new eCTD guidelines before the deadline of 31st December, this is a real problem.
With the externally hosted business model, however, they could have access to the functionality they need tomorrow!
Smaller, biotech companies are unlikely to have the budget to buy in all the software they need, in any case. Then there is the burden of the staff needed to run and support the systems.
Maximising internal talent
In a remote, managed service model, the burden on internal staff is massively reduced, allowing internal experts to focus on core activities which have a more direct bearing on the performance of the company. This is of substantial appeal to pharmaceutical companies of all shapes and sizes – from the giant global firm that might have a submissions team of 10–12 full-time employees on large salaries, to the small biotech firm with scarce if any internal IT resource.
Clearly, harnessing SaaS in the complex environment of drug development, validation and licensing is more complex than with simple business applications such as the highly popular customer relationship management solution, salesforce.com. In contrast, licence submissions management requires expert backup.
A wealth of services to draw on
Under-resourced or efficiency-conscious organisations may also want to tap into additional important yet
non-core services (such as medical writing, regulatory consulting and training), so will need to assess potential hosted software providers on their ability to provide a full service, which encompasses their chosen range of applications, and the full range of selected skills which have been earmarked to be outsourced.
Above all, they will need to identify a service provider they can trust as a partner: a company with the history, experience and process and security certifications they require to give them the confidence they need to extend their team of experts to include external members.
The upside of all of this is that recent changes in submission regulations and guidance have enabled pharmaceutical companies to change the way they think about and manage their related business processes, creating new options that did not exist before. Those that simply replace manual, paper-based activities with expensive electronic systems, only to arrive at much the same results as before, will be doing themselves and their business as a disservice – closing the door on a rare opportunity to make some far-reaching changes whose benefits could be widely felt.
By shaking out distracting, time-consuming, resource-draining support work, organisations have a chance to clear themselves of clutter, reign in some otherwise substantial costs, and move forward more dynamically.
CIOs who want to prepare their companies for the future should be researching, piloting, and selectively deploying elements of SaaS over the coming months. Careful consideration should be given to where deployment should begin. Although one school of thought is to start small in scope, pharmaceutical companies may want to target core business areas, using SaaS to facilitate process transformation.
This is an accepted strategy now, too. Indeed, a growing per centage of pharmaceutical IT services, along with other back-office operations, are being outsourced as companies attempt to refocus their time and energy on their core competencies.
Research firm EquaTerra notes that this is partly because the leading technology outsourcing partners are increasingly offering enhanced support around process improvements – designed to smooth technology uptake and reduce the time it takes to obtain true benefits. This points to a golden opportunity for CIOs to work with partners to bring value in the forms of cost savings and improved processes.
Even the largest pharmaceutical giants are realising they cannot do it all – at least not successfully – with the result that the pharmaceutical company of the future may look very different than the one we are familiar with today.
Companies may ultimately outsource much of their core business – such as drug discovery, clinical trials, manufacturing, and even regulatory approvals – to domestic and offshore business partners in China, India, South Asia or Eastern Europe.
Shedding much of what they do will enable pharmaceutical companies to evolve into pure marketing or pure drug discovery organisations, with targeted disciplines in particular therapeutic areas.
Letting an external company take care of software ownership, management and related support services is just another step in the same direction. The advantage in making the leap now is all about timing.
Gilbert Kampfner is managing director of Image Solutions Europe GbmH, Eschborn, Germany, www.imagesolutions.com
