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Abstract

US pharmaceutical manufacturers are increasingly requiring their active pharmaceutical ingredient (API) suppliers to sign quality agreements. This trend — if properly managed by finished-dosage manufacturers — should enable them to enhance the quality of their products without unduly burdening API suppliers. As many of these suppliers are now located in developing industrial countries, this trend will have a significant impact on global supply chains in the pharmaceutical industry. This paper, examining quality agreements from the vantage point of the contract lawyer, will discuss (1) the regulatory basis for requiring quality agreements, including recent changes prompting more finished-dosage manufacturers to require API suppliers to sign quality agreements, (2) hot-button issues in quality agreements and (3) best practices for drafting effective quality agreements. Because the authors are US lawyers, the paper is written from the perspective of US federal laws except where specific reference is made to the laws of other jurisdictions.

Keywords

quality agreement technical agreement active pharmaceutical ingredients

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References

See 21 CFR §210.3(4), defining ‘drug product’ to include only ‘a finished-dosage form, for example, tablet, capsule, solution, etc’.

Food and Drug Administration Compliance Program Manual (Program 7356.002F), dated 13th February, 2006, Chapter 56, Drug Quality Assurance at 4.

21 CFR §210.3(b)(12).

Unless specifically defined otherwise in the commercial supply agreement, the most authoritative and widely accepted definition of Good Manufacturing Practice as applied to API suppliers is ICH Q7A Good Manufacturing Practice Guidance for Active Pharmaceutical Ingredients published by the following agencies of the US Government: Department of Health and Human Services, Food and Drug Administration, Center for Drug Evaluation and Research, Center for Biologics Evaluation and Research and ICH. This Guidance was developed within the Expert Working Group (Q7A) of the International Conference on Harmonisation of Technical Requirements for Registration of Pharmaceuticals for Human Use (ICH). As stated by the FDA, ‘ICH Q7A represents the Food and Drug Administration's (FDA's) current thinking on cGMPs for API's. Food and Drug Administration Compliance Program Manual (Program 735.002F), dated 13th February, 2006, Chapter 56, Drug Quality Assurance at 4.

In Europe, on the other hand, quality agreements have been required by regulations such as Directives 2003/94 EC and 91/412/EEC, which provide that outsourced work be subjected to a written contract setting forth each party's responsibilities with respect to Good Manufacturing Practices.

The Quality Guidance Document was published by the following US Government agencies: Department of Health and Human Services, Food and Drug Administration, Center for Drug Evaluation and Research, Center for Biologics Evaluation and Research, Center for Veterinary Medicine and Office of Regulatory Affairs. Although the Quality Guidance Document states that it ‘may also be useful to manufacturers of components (including active pharmaceutical ingredients)’, it only directly ‘applies to manufacturers of drug products (finished pharmaceuticals)’. See § II.C. (Scope of Guidance).

Quality Guidance Document, § I (Introduction).

Quality Guidance Document, § II.B. (Goal of the Guidance).

It should be noted that ICH Q7A also contains at least one statement urging API suppliers to use written quality agreements with their subcontractors. Section XVI of that Guidance (Contract Manufacturers (including Laboratories)) provides as follows: ‘Where subcontracting is allowed, a contractor should not pass to a third party any of the work entrusted to it under the contract without the company's prior evaluation and approval of the arrangements’.

10.

See Section 506A of the Act (Manufacturing Changes) and 21 CFR, Part 314.70(a) (Changes to an approved application).

Attention API Suppliers: Quality Agreements are here to Stay

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