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Reported by Annette Kreuger, Industrial Info Resources (Sugar Land, Texas)--In today's Pharmaceutical & Biotech Industry, where construction costs for an advanced manufacturing plant can top $1,000 per square foot, proper maintenance is of the utmost importance. The last thing any drug, medical device or toiletries manufacturer needs is equipment failure or malfunction within the production process.
In North America, there are currently 924 active projects for maintenance, repair and overhaul (MRO), according to Industrial Info's project database, representing $1.6 billion in total investment value (TIV). The average TIV is $1.7 million. The actual projects range from a $500,000 maintenance program for a clinical scale active pharmaceutical ingredients (APIs) plant in Portland, Oregon, to a $14 million plan at major vaccine-manufacturing plant in Durham, North Carolina. For more information, see Industrial Info's project reports on the API plant and the vaccine-manufacturing plant.
Click on the image at right for a graph detailing North American MRO projects in the Pharmaceutical-Biotech Industry.
Regular maintenance protocols are essential for a number of reasons, including equipment protection and to avoid a "shutdown" of another sort--by, say, the U.S. Food and Drug Administration (FDA). Just one piece of aberrant equipment in an entire production line can bring the wrath of the FDA upon a product, the company and the plant that produced it. Not one drug manufacturer wants to receive the dreaded FDA Form 483.
The official name of the FDA Form 483 is a "Notice Inspectional Observations." The 483 is issued at the end of an on-site inspection if there were any observed conditions that violate the Food, Drug or Cosmetic Act.
All roads of investigation for a bad drug lead to the plant of origin. If the maintenance records are not current, what could have been a limited run of bad PR turns into a corporate nightmare. By the time a manufacturer has to pull a product off the shelves, the damage is already done.
Akorn Incorporated (Lake Forest, Illinois) is a good example of just how things can escalate from bad to worse. A $4.3 billion buyout deal by Fresenius Kabi (NYSE:FMS) (Bad Homburg vor der Höhe, Germany) is in serious jeopardy. Akorn's sterile manufacturing site in Decatur, Illinois has received a number of 483s, including one issued last spring.
One of the problems was a concern that particles that could contaminate injectables appeared to be shedding from a conveyor belt. Akorn had been attractive to the German drugmaker to expand its sterile manufacturing capacity. As further regulatory issues have come to light, there is speculation that the deal will not close in April 2018, as originally planned. For more information, see Industrial Info's plant profile.
It truly does not matter where the plant is located. If the products are sold as being FDA regulated, location makes no difference. Case in point: Sun Pharmaceutical Industries Limited, India's largest drug maker, received a 483 during an inspection earlier this month. Its plant at Haolo in Gujarat, India, received three observations for failing to meet good manufacturing practice standards.
The facility at Halol, one of Sun Pharma's biggest units, holds the key to its U.S. formulation business. Sun Pharma gets about half of its revenue from the U.S. market and the Halol unit contributes a majority of its drug filings. For more information, see Industrial Info's plant profile.
For these reasons and a host of others, the majority of industry manufacturers adhere to a regular maintenance, repair and overhaul (MRO) program to ensure that process and supporting equipment and utilities will continue working in optimal condition. Typically, but by no means always, the industry's plant shutdowns occur once during the summer and again in late December. Others have a rolling program, with shorter maintenance schedules occurring on a more frequent basis. Many companies also use the maintenance shutdowns, and sometimes part of the MRO budget itself, to tie in or finish off capital projects.
These figures are expected to increase, as new project schedules are uncovered and reported. A declaration made by plant personnel of "never using outside contractors" is invariably followed by the allowance of "sometimes," or "perhaps" using contractors, depending on the job. So "no," in this case, does not necessarily mean "no." With fiscal accountability tighter than ever before, it would be a rare company indeed that would not at least consider the qualified goods and/or services of a new provider.
These figures only tell part of the story in regards to earnings potential at the plant level. Knowing who, what, when, where and how much is being invested is a great source of potential work for a multitude of vendors, including suppliers and contractors. In addition to performing the maintenance itself, the shutdowns also provide a time that companies can identify equipment that may be nearing the end of its useful life and needs to be replaced. Knowing who the maintenance planners and schedulers are, and initiating regular contact with them and others at the plant, could lead not only to being included in the maintenance program but also going on to be a part of a future capital project.
In some cases, other vendors so impress the company with work performed during a maintenance shutdown that they land an alliance or long-term service agreement (LTSA) contract with the plant. Upon securing such a contract, the vendor is the designated contractor for in-house maintenance operations. In some cases, an office is opened on-site and staffed by the contractor.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
In North America, there are currently 924 active projects for maintenance, repair and overhaul (MRO), according to Industrial Info's project database, representing $1.6 billion in total investment value (TIV). The average TIV is $1.7 million. The actual projects range from a $500,000 maintenance program for a clinical scale active pharmaceutical ingredients (APIs) plant in Portland, Oregon, to a $14 million plan at major vaccine-manufacturing plant in Durham, North Carolina. For more information, see Industrial Info's project reports on the API plant and the vaccine-manufacturing plant.
Click on the image at right for a graph detailing North American MRO projects in the Pharmaceutical-Biotech Industry.Regular maintenance protocols are essential for a number of reasons, including equipment protection and to avoid a "shutdown" of another sort--by, say, the U.S. Food and Drug Administration (FDA). Just one piece of aberrant equipment in an entire production line can bring the wrath of the FDA upon a product, the company and the plant that produced it. Not one drug manufacturer wants to receive the dreaded FDA Form 483.
The official name of the FDA Form 483 is a "Notice Inspectional Observations." The 483 is issued at the end of an on-site inspection if there were any observed conditions that violate the Food, Drug or Cosmetic Act.
All roads of investigation for a bad drug lead to the plant of origin. If the maintenance records are not current, what could have been a limited run of bad PR turns into a corporate nightmare. By the time a manufacturer has to pull a product off the shelves, the damage is already done.
Akorn Incorporated (Lake Forest, Illinois) is a good example of just how things can escalate from bad to worse. A $4.3 billion buyout deal by Fresenius Kabi (NYSE:FMS) (Bad Homburg vor der Höhe, Germany) is in serious jeopardy. Akorn's sterile manufacturing site in Decatur, Illinois has received a number of 483s, including one issued last spring.
One of the problems was a concern that particles that could contaminate injectables appeared to be shedding from a conveyor belt. Akorn had been attractive to the German drugmaker to expand its sterile manufacturing capacity. As further regulatory issues have come to light, there is speculation that the deal will not close in April 2018, as originally planned. For more information, see Industrial Info's plant profile.
It truly does not matter where the plant is located. If the products are sold as being FDA regulated, location makes no difference. Case in point: Sun Pharmaceutical Industries Limited, India's largest drug maker, received a 483 during an inspection earlier this month. Its plant at Haolo in Gujarat, India, received three observations for failing to meet good manufacturing practice standards.
The facility at Halol, one of Sun Pharma's biggest units, holds the key to its U.S. formulation business. Sun Pharma gets about half of its revenue from the U.S. market and the Halol unit contributes a majority of its drug filings. For more information, see Industrial Info's plant profile.
For these reasons and a host of others, the majority of industry manufacturers adhere to a regular maintenance, repair and overhaul (MRO) program to ensure that process and supporting equipment and utilities will continue working in optimal condition. Typically, but by no means always, the industry's plant shutdowns occur once during the summer and again in late December. Others have a rolling program, with shorter maintenance schedules occurring on a more frequent basis. Many companies also use the maintenance shutdowns, and sometimes part of the MRO budget itself, to tie in or finish off capital projects.
These figures are expected to increase, as new project schedules are uncovered and reported. A declaration made by plant personnel of "never using outside contractors" is invariably followed by the allowance of "sometimes," or "perhaps" using contractors, depending on the job. So "no," in this case, does not necessarily mean "no." With fiscal accountability tighter than ever before, it would be a rare company indeed that would not at least consider the qualified goods and/or services of a new provider.
These figures only tell part of the story in regards to earnings potential at the plant level. Knowing who, what, when, where and how much is being invested is a great source of potential work for a multitude of vendors, including suppliers and contractors. In addition to performing the maintenance itself, the shutdowns also provide a time that companies can identify equipment that may be nearing the end of its useful life and needs to be replaced. Knowing who the maintenance planners and schedulers are, and initiating regular contact with them and others at the plant, could lead not only to being included in the maintenance program but also going on to be a part of a future capital project.
In some cases, other vendors so impress the company with work performed during a maintenance shutdown that they land an alliance or long-term service agreement (LTSA) contract with the plant. Upon securing such a contract, the vendor is the designated contractor for in-house maintenance operations. In some cases, an office is opened on-site and staffed by the contractor.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
