In 2009, drug recalls reached an unprecedented high of 1,748. These recalls are attributable, in large part, to outsourcing and indiscriminate cost cutting. Today, more recent drug recalls and the resulting bad press are forcing the pharmaceutical industry to shift their focus to the manufacturing aspect of the drug production process. This latest rash of drug recalls has also intensified both consumer and media backlash against the pharmaceutical industry. A few examples of the most recent incidents:

  • 9 October 2010 – Reports of an uncharacteristic odor prompted Pfizer to recall the 40-mg bottles of LIPITOR. (
  • 8 October 2010 – FDA pressure led Abbot Laboratories, the manufacturer of Merida (sibutramine), to recall the drug in the US, Canada, and Australia due to the possibility of cardiovascular events after long-term use. (
  • 7 October 2010 – FDA violations of its anti-aromatase ingredient resulted in Gaspari Nutrition recalling all lot codes of the testosterone enhancer Novedex XT. (
  • 25 September 2010 –Amgen is voluntarily recalling certain lots of EPOGEN and PROCRIT because of possible contamination by glass flakes. (

Coming on the heels of a massive triple recall by Johnson & Johnson, however, these recent events have created a new opportunity for the pharmaceutical industry to emphasize manufacturing and implement much needed lean manufacturing solutions. With the current scarcity of new blockbuster drugs, and the cost of bringing new drugs to market running in the neighborhood of $1.5 billion, drug companies are struggling. The opportunity for them to benefit from a new image and from lean manufacturing implementation is at hand.

Lean manufacturing techniques do work, but effective implementation in the pharmaceutical industry requires knowledge of the special circumstances that exist in the industry, i.e. the difficulties involved in altering batch sizes, the fact that 75% of drug recalls can be attributed to manufacturing defects, the compartmentalized nature of the departments within the process, and burdensome regulatory compliance concerns among others. Further complicating the situation is the growing use of contract manufacturing organization’s (CMOs) which require companies to manage increasingly complex external relationships without compromising quality.

According to Nigel Smart, Managing Partner of Smart Pharmaceutical Consulting, “With so much talk about outsourcing off-shore, American jobs are being lost at an alarming rate in an area where there’s been traditional strength. Strategically, this is a problem for the US Pharmaceutical industry. Perhaps now’s the time for us to re-assert this strength? However, we’ll only be able to do that if we apply the appropriate techniques and methods in a logical and consistent fashion.” Fortunately, manufacturing is the one aspect of drug production most amenable to change and improvement, thereby enabling manufacturers to rebuild their image and reputation. It is also the arena in which lean manufacturing consultants are beginning to play a vital role in the transformation of a struggling industry. Decreased outsourcing combined with implementation of lean manufacturing solutions can help pharmaceutical manufacturers polish up their tarnished image, and regain their competitive edge.

To learn more about how lean manufacturing strategies can streamline your business and improve your bottom line, visit Smart Lean Manufacturing.