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When pharma deliveries involve a multicomponent kit, contractors offer dedicated services
Most pharmaceuticals are packaged in bulk bottles for delivery to pharmacies, or as dose-specific packages that are in turn packed in cartons and pallets. But nearly any pharmaceutical in the market also has a varied list of special packaging requirements, such as sample packages, combined drug and delivery components (such as syringes), along with promotional materials, medication guides and the like. The clinical trial world brings an order-of-magnitude increase in testing and component combinations. For these and other applications, a kit-assembly process, or “kitting” is the order of the day. And rather than adding to labor- and equipment-intensive processes, manufacturers are increasingly relying on contractors—primarily contract packagers and third-party logistics (3PLs) providers—to supply kitting services more efficiently.
“Utilizing logistics providers like ourselves is essentially one-stop shopping for our customers,” declares Jeff Luthman, VP, life sciences solutions at MD Logistics (Plainfield, IN). “Our service offerings improve repackaging cycle time and reduce overall costs.”
Kitting is said to offer drugmakers a convenient and cost-effective way to deliver products to market while making drug administration easier. Instead of receiving individual components from multiple suppliers required for a given therapy, caregivers receive a self-contained package offering all the necessary components for drug administration.
“Clinical trials are a huge market for kitting,” notes Jim Saponaro, VP for the life sciences and healthcare industry, Exel Logistics (Westerville, OH). “In this instance, several components are bundled together into one package—such as medication, supplies and directions—and then shipped to patients involved in the trial.”
FIG. 1. INJECTABLES KIT ON THE ASSEMBLY LINE AT ANDERSON PACKAGING
Components found in kits may include items such as a syringe, vials, swab, delivery devices, and product literature, which are automatically, semi-automatically, or manually sealed into kit units. “It varies, depending on the drug indication, delivery form, and whether it is intended for home use or administered in a clinical setting,” says Justin Schroeder, senior director, marketing and development services, Anderson Packaging (Rockford, IL). “Manufacturers look to us in assembling the kitted components because we offer a turnkey solution, being able to source many of the components, as well as the sophisticated inspection systems we employ to ensure a high level of quality.”
Determining what gets bundled with the Rx drug often depends on the type of medication. For example, kits that treat chronic illnesses such as MS, diabetes and rheumatoid arthritis, contain product, delivery devices, alcohol swabs and instructions. Many parenteral delivery forms, such as injectable drugs and transdermals, involve a cross section of components necessary to complete unit treatment. “It’s common to see complex, high-cost therapy programs that require ancillary components to support the delivery system utilizing kit presentations,” says Daniel Stehn, director of biotechnology packaging, Sharp Corp. (Allentown, PA). “Home-administered products are also common candidates for kit applications.”
Kitting provides a real benefit in connecting the physician and patient by providing educational, practice-related and compliance-oriented materials. Kitting of patient starter kits for oral-solid delivery forms often include a compliance prompting package, compliance and adherence supporting materials, rebate or discount cards, and literature to facilitate patient education. “The intent is to maximize the first-time patient experience with the drug,” Anderson’s Schroeder points out. “We have even been asked to assemble promotional marketing kits designed for demonstration purposes only, by virtue of our ability to consistently and reliably ensure every piece is present and in the correct location.”
“Customers can receive information on new products or discounts for current products by attaching these to kits,” says Denise Odenkirk, VP, O&M HealthCare Logistics, a division of Owens & Minor (Mechanicsville, VA). “Pharmaceutical companies can extend their reach and enhance sales through the simple step of including another piece to the kit.”
FIG. 2. WHERE KITTING HAPPENS AT O&M HEALTHCARE LOGISTICS
Packages utilized for bundling drugs and relevant components together range from plastic trays and bags to corrugated boxes and totes. Packaging for temperature-controlled pharmaceuticals may also include insulation to maintain temperature standards.
Kitting solutions providers say they are well positioned to sourcing the necessary medical components and delivering them in a suitable package for end users. They represent a valuable resource for clients to outsource traditional in-house activities, or companies who have a limited packaging and distribution infrastructure. “Our ability to handle the kitting process efficiently and effectively is a way to leverage our variety of products and services into what we call our ‘value multiplier effect,’” explains Joe Lally, sales manager, pharmaceutical packaging, Howell Packaging (Elmira, NY). “We gain a significant competitive advantage when we bundle our products and services.” Howell offers project management and supply chain specialists who are utilized for projects that require coordination of the many complex elements in kitting production, assembly, storage and distribution.
Pharma companies often tap into kitting services offered by third-party sources because the planning and logistics of all required materials can be quite an undertaking, observers say. The labor-intensive process involves, among other things, sourcing and assembling various components and coordinating scheduling with multiple manufacturers. 3PLs claim to offer scale and expertise for kitting that drive down costs for pharmaceutical manufacturers compared to in-house options.
“Kitting can also be an equipment- and labor-intensive endeavor, so 3PLs take on this capital investment and also have the expertise to scale up or scale down labor with demand and provide much-needed flexibility,” Exel’s Saponaro says. “As pharmaceutical companies concentrate more and more on their core business, 3PLs like Exel can offer value in their supply chain expertise and provide synergies between kitting and other supply chain activities.”
There are various factors impacting whether a pharma company would outsource kitting services, experts say, with cost and efficiency among the most logical. Packaging postponement strategies, product sample creation, and unit of use deployment are additional drivers. “Additionally, shipping larger bulk quantities to the distribution center is more cost-effective and allows for just-in-time (JIT) production,” MD Logistics’ Luthman says. “We are then able to repackage product into the appropriate sizes for the customer.”
The process can vary widely, depending on the package and run volume. Small runs could be very manual, whereas larger runs could involve automation and elaborate filling systems. “But regardless of size, our processes feature extensive inspection systems throughout,” Anderson’s Schroeder says. “These are critical for ensuring the proper contents for every pack produced. We also provide value in being able to source the many components, leveraging our purchasing power to reduce costs with turnkey supply.”
“Whenever possible, the ability to position components in their sequence of use can provide advantages, and designing cavities for each component can also provide a quick visual aid to ensure all materials are enclosed,” says Sharp’s Stehn.
By comparison, 3PLs offer a wide range of supply chain activities — from analysis to execution — and are often able to identify and provide synergies between kitting and the supply chain. For pharma companies, this can mean shared warehouses, labor and systems, as well as less shipping, handling and damage. “By leveraging these existing assets, a 3PL is closer to the customer and gives the pharmaceutical customer both one point of contact for all supply chain activities,” Exel’s Saponaro says. A trend toward “postponement”—the practice of sending partially assembled kits to various depots around the world, and then finishing them with country-specific documentation, provides cost efficiencies and supply chain flexibility, since one depot can serve multiple countries in a region, and can help moderate inventory swings among different national markets.
UPS Healthcare Logistics (Atlanta) operates a packaging group in Louisville, KY, which manages planning and logistics of purchasing and distribution/utilization of packaging for many of its customers. “We are able to add value to these customers by consolidating or aggregating their requirements and leveraging our purchasing power,” notes Alan Amling, director, global logistics and distribution. “The knowledge we gather on customer utilization of packaging and working closely with the customer allows for efficient planning and execution.”
MD Logistics manages the kitting process by providing a value-added turnkey solution within the four walls of its facility. It regularly has its customers’ products and collateral material in-house, as well as any required packaging components, enabling the firm to schedule production with a JIT mindset. “This provides immediate savings in transportation and handling costs for our customers,” Luthman says. “By providing kitting services in-house, we can mitigate security and product monitoring concerns by utilizing a streamlined process that allows products to remain in our custody and at our facility throughout the supply chain.”
Kit assembly shares many of the same warehousing and packaging processes of conventional distribution, so there are efficiencies when the service provider has these processes and equipment already in place. “Our skill set allows us to perform kitting through picking, packing, and shipping a variety of products either built to specification or through customization for each order,” O&M’s Odenkirk says. “We are able to assemble kits based on drawings or instructions from clients for standard medical procedures, or alter a kit based on what a surgeon needs for a given patient.”
As 3PLs move into value-add services like kitting, contract packagers are expanding their logistics and fulfillment capabilities. Some companies, such as Sharp, offer primary and secondary packaging as well as 3PL standard services. “By combining these services, we can partner with our customers and assist them with minimizing their working capital requirements, as well as assist them in fulfilling customer demand requirements,” Stehn says. “By providing these combined services, we streamline their supply chain.”
Contract packagers and 3PLs say they maintain close ties with suppliers of various components and products for kitting. In some cases, pharma companies may designate or specify suppliers they have audited and approved, experts say. “Pharmaceutical companies are very disciplined about sourcing and often provide all components to 3PLs, or tell us exactly who to buy them from,” Exel’s Saponaro says. “The ability to plan effectively really comes down to the accuracy of the forecast and being able to predict demand, while taking seasonality and other factors into account.”
In other situations, third-party service providers are given complete latitude to source components. “We typically work with suppliers that our customers already have in place, or we provide turnkey solutions using our own qualified vendors,” MD Logistics’ Luthman says. “In order to uphold the integrity of the kitting process, we prefer to coordinate the ordering and delivery of components to ensure we are time-sensitive and cost-effective.” When ordering materials, MD Logistics utilizes an in-house MRP (materials resource planning) system to manage its processes.
Howell Packaging implements a program which qualifies and measures the performance for all of its outside sources, Lally says. Supply chain specialists utilize custom software to plan and manage the logistics of all required materials. These specialists are also capable of electronically connecting with customers and collecting their orders. “This allows us to assemble to the market instead of assembling to a forecast,” Lally explains. “This streamlined mode enables tighter response and achieves ultimate ‘postponement’ of final product assembly.”
During the sample-build process, assembly or special instructions are created. Once the client has approved the sample and assembly instructions have been approved, production of the kit can begin. There are controls built into the process to handle the intricacies of kitting services while distributing within FDA and DEA guidelines, industry members say. For example, maintaining a master device record of the components placed in the kit and supporting documentation is a necessary control. “Device specifications, production methods, quality assurance procedures, and packaging and labeling requirements may be contained in the device record,” OM HealthCare Logistics’ Odenkirk says.
Another key component specific to a kitting operation is strict control over the labels, product inserts and similar material. “This would include inventory control, secure storage, and end-of-line clearance and accountability of all items,” UPS’ Amling says. “This process helps ensure that all units created or kitted are done so in accordance with the work instructions and with the original master record.” Kitting of DEA-controlled substances requires another level of security and accountability requirements mandated by the DEA for reporting and inventory control as well.
In addition to maintaining necessary quality certifications and licenses, the requirements to perform a function such as kitting are the same cGMP type of guidelines followed for the warehousing and distribution of finished goods in healthcare, industry members say. All such activity must be done under the guidance of a compliant quality system that would include general inventory-control aspects such as cycle counting, traceability and product identification.
FIG. 3. A MULTI-COMPONENT KIT FROM ANDERSON PACKAGING
“Packaging needs to be performed in a cGMP environment with appropriate technologies to ensure the safety of the drug supply,” Anderson’s Schroeder says. “Mistakes can have serious implications for the patient and the drug company.” Anderson says its packaging operations, systems, and facilities are audited by governmental agencies.
Frequent training is also a control maintained to keep employees aware and
well-informed of the proper precautions and procedures for processing kits. “All employees should be trained on the specific work instructions for the jobs they will be performing,” Amling says. “General requirements such as sanitation, pest control, change control, and vendor qualification all apply to a kitting operation, the same as with handling finished goods.”
A key area of expertise third-party service providers can bring is regulatory and compliance knowledge. For an operation such as kitting, regulations mandate strict double checks of the process to ensure accuracy of the finished goods to the approved master record. “This would include random inspections and spot checks along the assembly line, as well as random inspections of the finished items themselves,” Amling says. “This ensures all products were kitted as outlined in the work instructions and that all product, lot and other specific information is accurately maintained and traceable.”
Expiration dates of all components are tracked, so no product is placed in a kit that is outside of the allowable shipping window, or has already passed expiration. “As part of our batch record process, we work closely with our clients to ensure that the dating of the drug drives the expiration date for the kit presentation and that FIFO is used,” Stehn says, noting that due to the nature of its client base, Sharp sees a range of international regulatory inspections from MHRA, EMEA, and ANVISA. “It is not uncommon to exhaust one lot of a particular component and introduce a second lot when packaging a kit presentation.”
Compliance with pedigree standards relative to the process of kitting and supply chain management is a major challenge, experts say. This pertains to being able to trace individual components of a kit in the event of a recall, as well as meeting state agency requirements to show the origin and chain of possession of each component in an effort to prevent adulteration and counterfeiting. The tracking of pharmaceuticals through pedigree is still in the early stages of development and thus, not all of the rules have been defined yet.
“This presents a challenge in the interim of ensuring conformity with current legislation,” OM HealthCare Logistics’ Odenkirk says. “As pedigree rules evolve, 3PLs will take the proper steps to incorporate standards while managing the chain of custody of products within a kit.” PC