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Enterprise Optimization in the Pharmaceutical Industry
Understandably, in the pharmaceutical industry, market forces continue to drive the adoption of the latest
advancements in enterprise optimization solutions. The latest generation of solutions is capable of generating
more value in each value-creation process chain, and offers the advantage of presenting new opportunities in
the Internet era.
A more pragmatic approach is to employ new process improvement solutions that will lead to sustainable
increases in NCE discovery rates as well as other internal efficiencies that will increase effective patent protec-
tion time. Increased earnings unlocked by these internal improvements can fund additional NCE launches.
While there are billions of dollars of opportunity inside pharmaceutical organizations, the value remains
trapped in time-to-market opportunity costs, research and development inefficiencies, under-developed
processes for matching supply with demand, poor manufacturing cycle efficiency and discontinuous
workflows. Unlocking the value isn’t simple. It requires knowledge and implementation of the latest
technologies coupled with deep process knowledge across the pharmaceutical organization. This is the
essence of AspenTech’s Enterprise Optimization™ solution for the pharmaceutical industry.
Our specialized expertise provides an extraordinary understanding of the unique requirements of the pharma-
ceutical industry. AspenTech’s Enterprise Optimization solution employs best-in-class technologies such as
neural networks, chemical process simulation, statistical process control, expert systems, stochastic simula-
tion, linear programming and other advanced planning methods. We are the only supplier to provide such a
rich portfolio of advanced solutions designed to maximize and harvest the pharmaceutical industry’s True
Potential™.
Here are some ways Enterprise Optimization enables pharmaceutical industry leaders to improve business
performance:
• Innovation improving workflows to increase the NCE pipeline, and increase the number of NPIs while
reducing time-to-market.
• Collaboration actively involving customers, suppliers and partners to help improve value creation
across the extended supply chain, in process engineering/innovation and manufacturing.
• Integration creating more agile and responsive business processes both internally and among
external partners eliminating delays, costs, and dramatically improving organizational efficiency.
• Automation decreasing human errors, assisting in decision-making, speeding the scale of production
to meet clinical requirements and commercial production levels, extending beyond the effective
automation of the manufacturing assets and deriving more utility out of existing Enterprise Resource
Planning systems.
• Optimization enabling the enterprise to operate at globally optimal performance levels as opposed to
a series of local optima, which may not represent the best performance for the business as a whole.
Between 2000 and 2005, 130 pharmaceutical drugs are expected to lose their patent protection, opening the
floodgates for generic manufacturers to begin sales of their versions. Generic manufacturers begin planning
their production of these drugs years prior to the patent's expiration. As an example of the potential lost
market share, Glaxo Wellcome’s patent for Zantac expired at the end of July 1997. After only three months,
generic versions grabbed 60% of the prescriptions, dramatically impacting sales and earnings.
Many of the guidelines and regulations are complex and subject to multiple interpretations. In addition,
while these regulations are necessary to ensure product safety and traceability, they tremendously increase
the requirements placed on pharmaceutical manufacturers. Two of the most notable examples are:
• In May 1987 the Food and Drug Administration published guidelines on general principles of validation,
requiring companies "[to establish] documented evidence which provides a high degree of assurance
that a specified process will consistently produce a product [that meets] pre-determined specifications
and quality attributes."
• August 20, 1997 the FDA put into effect 21 CFR part 11. This regulation has two parts, one pertaining
to electronic records, and the second pertaining to electronic signatures.
Frequently, production is placed on hold until quality (QC) experts approve subsequent processing steps.
Significant delays can occur due to the variety of tests required. Many companies are looking for better
scheduling tools that will increase visibility of QC testing requirements.
Pharmaceutical manufacturing operations are often dynamic while, in most other industries, processes remain
constant for a particular product. In pharmaceutical manufacturing however, the processing steps can depend
on the subsequent product to be manufactured in the particular vessel or train, or the vessel’s preceding
contents. The primary reasons for these variations center on potential interactions which could reduce the
predictability, potency, or longevity of a compound. Typically, multiple levels of cleaning must be defined and
integrated into the production process.
That’s why it is imperative for suppliers to understand demand and how they will meet it. However, demand
planning, production planning, scheduling, inventory and deployment planning can be extremely difficult
because some key active ingredients have lead times in excess of six months. Some production processes
may require up to 16 months due to process cycle time. And less-than-perfect coordination around packaging
and labeling of new product introductions or campaigns can also delay the time-to-market.
Many pharmaceutical companies try to hedge against these complexities by over-producing by two to four
times the potential expected demand. But by clogging their supply chains, they are often creating more
problems than they are solving, making it harder to respond to actual market dynamics and increasing
manufacturing costs through excessively large inventories.
For NCEs that are ‘on-track’ for approval, the volume requirements often grow exponentially due to study
design requirements. For example, a single compound with a target demand of ten units, can grow into 1000
when the clinical study designer considers multiple dosage forms, un-blinded, single and double-blinded
studies and the inclusion of placebos in the patient kits.
NCEs’ attrition rates per clinical phase are 30%, 50%, and 33% for Phase’s I, II, and III respectively. The cost
of each NCE failure increases dramatically as it nears the latter phases of clinical trials. This is compounded
by the problem of potentially promising NCEs becoming waylaid due to a shortage of protocol patients since
participation in a study is voluntary and dropout rates tend to be high. Solutions must provide timely and
complete information to quickly identify failed NCEs as early in the clinical trial process as possible.
In addition, substantiating a case for regulatory authorities requires accurate and comprehensive data. Data
must be saved and easily communicated to regulatory agencies with minimal effort.
Internet-Enhanced Collaboration
AspenTech delivers value through the Internet by improving coordination with peer researchers, customers,
suppliers, and trading partners. Our capabilities over the Internet include:
• Collaborative Planning Forecasting and Replenishment (eCPFR)
• Collaborative Capable-to-Promise (eCTP)
• Collaborative Able-to-Promise (eATP)
• Collaborative Vendor Managed Inventory (eVMI)
• Collaborative Logistics
• Digital Marketplace
Using B2B Process Paks™, pharmaceutical manufacturers can implement collaborative efforts easily, scale
them to meet their requirements, and take advantage of AspenTech’s extensive experience in leveraging the
Internet to add value.
Through AspenTech Enterprise Optimization, regulatory compliance is achieved and time-to-market decreases
because many previously unsynchronized processes are now automated and connected. Resultant electronic
data can be used for electronic submissions, further streamlining the New Drug Application (NDA) process.
The breakthrough here is the move toward ‘configurable’ process industry solutions rather than ‘custom’
solutions. The Business Process Templates result in faster time-to-benefit, and dramatically reduce implemen-
tation cost while increasing solution deployment—by as much as 30% to 50% for a typical implementation.
Configuration creates substantial cost savings over build-it-from-scratch solutions while maintaining a high
degree of flexibility aimed at leveraging the unique competitive advantages of the customer.
NPD production data are accumulated into a large repository to allow for quick responses to Pre-Approval
Inspections (PAI) and Clinical Trials Material (CTM) requirements.
The Aspen Engineering Suite also includes an enabling tool that facilitates the transfer of products to other
production equipment and production locations. AspenTech facilitates the scaling of formulas that occurs at
this stage to optimize and ease production for various pilot and commercial manufacturing facilities.
AspenTech Enterprise Optimization solutions add dramatic business value to existing ERP implementations by
providing enterprise-wide integration among manufacturing facilities and the global supply chain. ERP systems
provide the integration backbone for business transactions, and AspenTech provides the integration backbone
for information, knowledge, and insight, which represents the majority of the value from integration. Together,
the two systems can improve supply chain visibility, enhance decision support and provide better quality data.
The most significant opportunities for business performance improvement through ERP-to-plant system
integration accrue in:
• Production Planning – by planning and optimizing specific production orders, based on a clear picture
of enterprise capacities, constraints, and throughput.
• Material Requirements Planning – by using accurate inventory levels for Active Pharmaceutical
Ingredients (APIs), excipients, intermediates and finished products. Our optimization tools also perform
much more accurate and precise MRP calculations.
• Quality Management – by capturing quality and certification requirements for both raw materials and
finished products, and by generating certificates for finished products.
• Plant Maintenance – by utilizing asset management solutions that (1) identify equipment needing repair
or re-calibration, and (2) automatically generate the necessary maintenance work orders.
Working together with ERP, Enterprise Optimization delivers an accurate picture of the complete manufactur-
ing environment, the supply chain, and business/financial data, making investments in ERP more valuable.
Reduced Time-to-Market
Reducing the time to market results from various improvements realized throughout the implementation of
AspenTech’s Enterprise Optimization solution.
Some sources of time-to-market reductions are:
• Reducing time to scale-up production
• Increasing the efficiency of the formulation team by sharing information
• Assuring regulatory compliance during CT production
• More efficiently screening candidate NCEs
• Reducing the time to gather data required for regulatory submissions
• Improving the scheduling performance due to long lead-time ingredients
• Using "What If" scenarios to know before doing, and prevent time consuming errors
• eSupply Chain Management by optimizing internal planning and coordination functions and laying the
groundwork for our Aspen Marketplace Solution, which tightens collaboration between the enterprise
and external business and trading partners.
• Product and Process Innovation by developing new products and processes, providing information for
clinical trials and efficiently transferring the technology to full-scale production.
• Manufacturing by increasing manufacturing agility, and efficiently making on-spec products while
adhering to regulatory requirements.
Key business processes that Aspen eSupply Chain Suite integrates, automates and optimizes include:
• Portfolio and Enterprise Planning
• Comprehensive Demand Management
• Capacity Planning
• Inventory Management
• Production Planning, Scheduling, and Execution
• Distribution and Logistics Management
• Reporting and Analysis
• Capable to Promise
In the Plant
The Aspen Manufacturing Suite optimizes processes involved in the conversion of raw materials into finished
pharmaceutical products. It provides the manufacturing agility and responsiveness needed to meet the
demands of the Internet era by dramatically improving throughput, reducing costs and managing compliance
to regulatory requirements. The Aspen Manufacturing Suite gives pharmaceutical manufacturers the ability to
make products at the lowest cost, with the highest added value, and at the minimal time required to best
satisfy customer needs—all while meeting safety and environmental objectives.
To the World
Aspen B2B Foundation™ is a family of products that meets the specific B2B requirements for integrating
inter-company and business processes. It streamlines the extended supply chain by allowing pharmaceutical
companies to automate key business functions such as order management, inventory management, collabora-
tive forecasting and planning.
This means that not only can companies exchange data in a mutually acceptable format, but that they can
also tie or integrate their disparate processes to each other. Each company is able to participate using the
most appropriate technology based on their role and the significance of their data exchange. B2B Foundation
enables Web-enabled B2B collaboration—the underpinning of successful collaborative applications such as
collaborative Capable to Promise (eCTP) and collaborative Vendor Managed Inventory (eVMI).
Together, we assess what level of improvement can be made by the application of our technology and services
to your business. The result of the assessment is a thorough cost-benefit analysis, ROI, and an action plan
detailing projects that will deliver the value. Customers are active participants and owners of the process, and
in many cases, present results to management themselves.
about AspenTech
AspenTech (http://www.aspentech.com) is the leading supplier of intelligent e-business solutions that make
process manufacturers powerful competitors. With deep process knowledge and best-in-class technology,
our products automate, optimize and accelerate performance by helping companies create and access net
markets, use the Internet to increase partner collaboration, and make business processes and extended
supply chains more efficient. We offer the broadest family of scalable solutions in the industry.
AspenTech is the one company with proven solutions that enable process manufacturers and their partners
to acheive dramatic results.
Discover how AspenTech can take your process to the power of e by visiting us at www.aspentech.com.
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