Pharmaceutical and Biotech Company Practices and Strategies That Create Efficient Global Clinical Supply Logistics BSMA Conference Mary Jo Lamberti, PhD Tufts CSDD April 26, 2017

About Tufts CSDD                        An independent, academic, non-profit research group at Tufts University Our mission is to develop strategic and actionable information to help stakeholders in the research-based drug development industry improve quality, efficiency and performance Primary Objectives To monitor and report on the development, regulation, and utilization of new drugs and biopharmaceuticals. To explore the economic, legal, scientific, and public policy issues affecting pharmaceutical and biopharmaceutical innovation worldwide To raise the level of national and international debate on issues related to new drug and biopharmaceutical product development and regulation. To hold forums and educational programs that bring together the perspectives of  government, industry, academia, and the public health community.

Rationale for Study Increasing pressure on clinical supply professionals as economics of supply chain management and distribution have grown substantially. Little to no historical data on performance, measuring impact of new processes and solutions and identifying areas of improvement within clinical supply logistics. Tufts CSDD study gathered data to examine current management practices and strategies that enhance efficiency and productivity within this area.

Overall Success Rates and Cycle Time in Years Cycle Time in Years from IND Filing to NDA Approval Source: EvaluatePharma

Number of Unique FDA-Regulated Clinical Investigators ‘08-’15 CAGR ‘12-’15 CAGR 4.6% 5.5% Source: Getz K, Brown C, Stergiopoulos S, Beltre C. Baseline assessment of a global clinical investigator landscape poised for structural change. Therapeutic Innovation & Regulatory Science. Online publish date: March 30, 2017

Global Distribution of Unique FDA-Regulated Clinical Investigators Source: Getz K, Brown C, Stergiopoulos S, Beltre C. Baseline assessment of a global clinical investigator landscape poised for structural change. Therapeutic Innovation & Regulatory Science. Online publish date: March 30, 2017

Study Overview Tufts CSDD 2014/2015 global logistics study kick off meeting was held in London in October 2014 with 14 working group companies. The study comprised both a comprehensive survey and study data gathered from working group companies. Our survey was conducted across a diverse group of organizations including biopharmaceutical companies, clinical supply logistics providers and suppliers.

Executive Summary A total of 17 respondents completed the logistics survey with three-quarters representing biopharmaceutical companies and one-quarter from clinical supply logistics providers and suppliers. Over 2/3 of the respondents were managers or directors from large companies while the remainder worked in mid-sized companies. Nine companies provided logistics data for 73 clinical studies across a diverse group of therapeutic areas including oncology, neuroscience/CNS, immunology and respiratory studies.

Executive Summary What are the preferred distribution strategies among organizations and what are standard practices? How is distribution managed? Companies manage their distribution by outsourcing nearly 40% of shipments, more than 25% are managed internally, and 20% use a mixed model. Overall outsourced/external costs (72%) were reported as a proportion of total supply costs Courier/depot (49%) and storage/distribution costs (40%) Supply distribution is global and concentrated in North America (78%), Western Europe (66%) and Eastern Europe (63%). Distribution is nearly evenly spread across regions of Latin America (29%), Asia Pacific (22%),and Rest of World (18%).

Respondent Organization Type Total Surveys n:Total Bio-pharmaceutical company 13:17 Clinical Supply Logistics Service Provider 3:17 Clinical Supply Logistics Product Supplier 1:17

Distribution Strategy and Execution

Key Performance Indicators of Distribution Success *Respondents selected multiple items

Improved Efficiencies Resulting from Company Practices *Respondents selected multiple items

Organizational Risk Assessment Response n=16 Yes 11 No 5 *Respondents selected multiple elements

Mean Percent Usage Per Method Management of Returns Mean Percent Usage Per Method Destruction at Site 37% Return to a Local Depot by Region 22% Return to a Local Depot by Country 18% Return to a Central Location 17% n=16

Challenges to Managing Returns N:Total Reconciliation and Document Destruction 4:15 Complexity of Managing Returns 3:15 Regulatory Requirements Costs 2:15 Highly Manual Process Site Compliance 1:15 N=15 Respondents selected multiple options

Pooled Supply Management Use Pooled Supplies N=16 Yes 9 No 7

Top Challenges to Implementing Pooled Supplies   N:Total Regulatory System 4:12 Labelling 2:12 Shipping Documentation Other System Planning Complexity 1:12 Reconciliation at Site n=12

Key Distribution Metrics Respondents selected multiple options

Product Waste/Overage- Average waste of packaged goods approximately 50% Mean Standard Deviation CoV Minimum Maximum Median Range Percent of Total Manufactured Product Packaged 89.9% 10.1% .1 70% 100% 90% 30% Percent of the Total Packaged Product that was Shipped to Sites 74.1% 21.0% .3 19% 80% 81% Percent of the Product Shipped that was Dispensed 67.8% 24.5% .4 5% 85% N = 12 Companies, 57 Studies

Study Overage - Strategies Accounting for Overage N:Total % is added into each study forecast 9:12 % is added into aggregated study forecast 2:12 % or actual used (based on historical use) 1:12 Respondents selected multiple options Yes No Overage Throughout Study 2 9

Organizational Training Areas in Which Training Is Offered N:Total IMP Handling 11:12 Returns 10:12 Reconciliation/ Accountability 9:12 IRT Inventory Management 4:12 Other Technologies GDP 3:12 Overage/ Waste 1:12 8 out of 12 of organizations train investigative staff on clinical supplies. Respondents selected multiple options.

Measures to Improve Training Effectiveness Visits to investigative site to capture feedback from site and pharmacy staff to enhance IP processes and identify areas for improvement. Measure compliance improvement after training. Examine trends and error rates in trip reports and address issues. Use of email blasts and newsletters to reinforce issues. Requirement of training certificate as part of site initiation. Close tracking of completion of required training by key study staff that manage IP. Provide IP manual with information and surveys on IP processes and training. Use of WebEx / Lync technologies to hold training sessions.

Study Update Article published in Applied Clinical Trials, October 2016 Lamberti MJ, Hsia R, Mahon C, Milligan C, Getz KA. Assessing global clinical supply logistics. Applied Clinical Trials. 2016;25(10)26-34. Plan to revisit metrics gathered on waste, shipping times, error rates (product impact) in a follow up study – Fall 2017

Thank You Mary Jo Lamberti, PhD mary_jo.lamberti@tufts.edu