CSL facilitated the most recent benchmarking session of asset management programs (AMP) with nine peer pharmaceutical companies in September 2024. Prior to the session, CSL received interest in two specific topics to discuss: CMO Asset Management and Obsolescence Management.
The conversations were held over two sessions, totaling almost four hours of collaboration. There was a very open and transparent exchange of information by all participants. Some participants chose to present on their company’s success or challenges with a particular topic and all were highly engaged for the open discussion and Q&A portions.
While each participating company was reflecting on their own unique journey, the following topics stood out as highlights from the benchmarking sessions:
Managing Obsolescence Risk through Asset Assessments
- Some form of regular assessment of an asset’s condition is necessary in order to manage and plan for obsolescence.
- There were varying ranges of maturity of these programs across the participating companies.
- Companies use these asset assessments to score an asset for easy tracking and comparison at both a site and global level.
- Some common threads that companies look at when determining scores:
- Regulatory requirements – does it meet all current GMP and local regulations?
- Business priorities – does it promote or fulfil current business needs?
- Hardware/software technology – is the accompanying IT system outdated?
- Availability of spare parts – how easy are spare parts to obtain?
- Age – is the asset outside of its useful life?
- Maintenance history – is the asset a “bad actor” or is it considered reliable?
Challenges with Integrating Assessments into Computerized Maintenance Management Systems (CMMS)
- Interest was expressed by multiple companies in being able to store information about asset assessments and obsolescence risk in the CMMS.
- A number of challenges were discussed about why this is not easy:
- Data Quality – current data isn’t consistent or complete.
- System Compatibility – CMMS is not set up to store or receive the related data.
- Multiple CMMS per company – some companies have multiple CMMS systems globally, usually due to acquisitions or mergers, making it difficult to standardize or manage this data globally.
Capital Expenditure (CapEx) versus Operational Expenditure (OpEx) Mitigations
- OpEx mitigation measures are short-term maintenance fixes which do not end up altering an asset’s risk priority number (RPN) but can help manage the risk until a longer-term mitigation can be implemented.
- CapEx mitigations are those longer-term overhauls, revamps, or replacements of obsolete assets that would significantly reduce a high RPN. For overhauls or revamps, it could also extend an asset’s useful life.
- Utilizing both types of mitigation strategies was an agreed effective technique for managing obsolescence risk. Finding the right balance of CapEx and OpEx mitigations and costs is important to ensuring assets are kept in the best form.
- Potential future discussion topic: how much companies spend on CapEx mitigations as a percentage of their total CapEx budget.
Current State of Contract Manufacturing Organization (CMO) Asset Management
A survey was conducted among the participants to establish the current state of CMO asset management for participating companies. The results were reviewed with the group.
- Only about half had started discussing asset management with their CMOs, though all had internal management practices, demonstrating an opportunity to engage these CMOs going forward.
- For those that do discuss asset management with their CMOs:
- These companies rely on the CMOs to have their own asset management programs rather than impose their own programs on the CMOs.
- They typically only discuss these programs when signing initial contracts and do not revisit them at renewal discussions.
- They do not typically perform a thorough audit of the CMOs practice, rather just discuss that one exists.
Benefits and Challenges of CMO Asset Management
Benefits
- Work with CMOs on asset management strategies can reduce the risk of single points of failure to ensure continuity of supply.
- Benefits are not only for the originating pharma company, but also other companies that CMO contracts with as the policies and programs should be applied to all their equipment.
Challenges
- CMOs are not always willing to share their business continuity plans or their asset management strategies with their contract partners.
- CMOs may take a defensive stance when asked about the topic by their contract partners, which can stall the discussions.
- Asset management is not always considered when vetting new CMO partners, or if it is, it is not a topic of priority.
All participating companies were keen to continue the discussions on a semiannual or annual basis. CSL has agreed to continue to facilitate these discussions, with the next session targeted for March/April 2025. Any individuals or companies who are interested in participating or have a topic idea to suggest for a future session are welcome to send an email to communities@ispe.org.
Disclaimer: iSpeak Blog posts provide an opportunity for the dissemination of ideas and opinions on topics impacting the pharmaceutical industry. Ideas and opinions expressed in iSpeak Blog posts are those of the author(s) and publication thereof does not imply endorsement by ISPE.
