Quality Metrics - Gain or Pain ?Practical experiences from AstraZeneca Sweden Operations

Rickard Fjaestad Gustafsson, Dir Quality SystemsISPE Nordic, Annual Meeting 2015 26th November 2015

2

Södertälje

AstraZeneca | Sweden

AstraZeneca’s largest high-tech manufacturing and supply site

Sweden Operations activities include manufacturing of active pharmaceutical ingredients, formulation, tabletting, filling and packing of finished products

Launch site for new medicines in form of tablets and capsules entering the global market

Accounts for more than 35% of AZ’s total sales value

Runs one of the largest tablet manufacturing plants in the world, producing approximately 10 billion tablets every year

Produce 30 different medicines for more than 100 markets

3

AstraZeneca has extensive research and manufacturing in Sweden

AstraZeneca | Sweden

• Mölndal is one of three strategic Research & Development centers within AstraZeneca

• Södertälje is AstraZeneca’s largest high-tech production and supply site

• In Sweden the AZ Nordic Marketing Company is responsible for the marketing & sales of our medicines and they have their offices in Södertälje

Södertälje3 800

Mölndal2 400 6 200

4

Improvement story2007 -2008

AstraZeneca | Improvement

0

2

4

6

8

10

12

2005 2006 2007

%

Rejection

5

Improvement story2007-2008

AstraZeneca | Improvement

6

Metrics

AstraZeneca | Metrics

"what you measure is what you get "

Kaplan, R. S. and D. P. Norton. 1992. The balanced scorecard - Measures that drive performance. Harvard Business Review(January-February): pp71-79.W. Edwards Deming, The New Economics for Industry, Government, Education, 2nd Ed

"if you can’t measure it, you can’t manage it"

?

7

Improvement story

AstraZeneca | Improvements

Success attributed to

• ”Copy with pride” (early adoption of standardization)

• ”Common language” (early adoption of business process concept)

• Cross-functional work (early adoption of supply system; quality leadership,

responsibilities, empowerment)

8

Balanced Scorecard

AstraZeneca | Metrics

Image retrieved from http://balancedscorecard.org/Resources/About-the-Balanced-ScorecardAdapted from R.S. Kaplan and D. P. Norton, “Using the Balanced Scorecard as a Strategic Management System,” HBR (Jan-Feb 1996): 76

What you do to get there

The resultyou get

9

Pitfall

AstraZeneca | Metrics

Harvard Business School, R.S Kaplan, Conceptual Foundations of the Balanced Scorecard, Working paper 10-074C. Chapman, A. Hopwood, and M. Shields (eds.), Handbook of Management Accounting Research: Volume 3 (Elsevier, 2009).

Lack of focus oninternal processes ?

10

Bias

AstraZeneca | Research

• Behavioural impact

• User variability

• System design

• Administration

11

Bias

AstraZeneca | Bias

Dev-20 %

Behavioural impact

* Original data has beenaltered

12

Bias

AstraZeneca | Bias

Behavioural impactDev,

repeats

Differing results depending on what ismeasured ?

Bias

13 AstraZeneca | Bias

Definitions

M

M M

MM

M

QC

WD

EM SM

QA

“FDA intends to carefully review data submitted in response to its requests, to help inform decisions about additional quality metrics data requests the Agency may make in the future.

Alignment betweenareas and between sites ?

14

Bias

AstraZeneca | Bias

User variability

?

Image from R.Fjaestad Gustafsson, SPP Progam essay ”Performance, Evaluation and Controls”, Warwick University, 2014

User options to interpretdefinitions?

=

15

Bias

AstraZeneca | Bias

System design, behaviour

Investigation days

What are you trying to achieve?

16

Bias

AstraZeneca | Bias

System design

…per lot (Lot size variability)

…repeats (”undetermined”, ”other”)

…per unit, ppm

…per sample (Sampling plan)

2

17

System design

AstraZeneca |Metrics

18

Administrative burden

AstraZeneca |Metrics

• ’Path of least resistance’• Measurement fatigue• Perceived lack of priority• Effort to interpret strategy abandoned, fall back on

obvious operational objectives

19

Quality culture

AstraZeneca | Culture

FDA recognizes that any individual data point or quality metric is not solely indicative of the state of quality of the establishment or products; rather, FDA intends to use this information in context.

FDA acknowledges the importance of quality culture to the overall state of quality of the product, process, and commitment to quality. We also recognize that many companies measure quality culture and encourage this practice. “

http://www.fda.gov/downloads/drugs/guidancecomplianceregulatoryinformation/guidances/ucm455957.pdf

20

The LEAN thinking model

AstraZeneca | Bias

- connection between values, principles, methods and results

Values

Principles

Methods

Results

How to think

How to do things

Ways to behave

21

Quality culture

AstraZeneca | Culture

22

Quality culture

AstraZeneca | Culture

Quality Culture drivers:

• AZ Supply system• ”LEAN Leadership”, ”Right From Me”, ”Right First time”• Senior leadership Townhall meetings• Senior leadership webcasts• AZ Values (”we do the right thing”)• ”Development week”• ”Culture Tree”• Pulse surveys, FOCUS, Springlife• ”Dialogue day”• Gemba walks

Opportunities

23 AstraZeneca | Opportuníties

K. M. Eisenhardt och J. A. Martin, ”Dynamic capabilities: What are they?,” Strategic Management Journal , vol. 21, pp. 1105–1121, 2000.

Business processes

Opportunitiesefficiency improvement

24 AstraZeneca | Opportunities

2013 2014 20153000

3200

3400

3600

3800

4000

4200

4400

4600

4800

5000

0

5

10

15

20

25

30

35

0

16.7 %

30.6 %

Masterdata, productivity

# changes % change/fte vs 2013

Metrics:• Input RFT• RFT• Leadtime

Devs -75%

Resource re-allocationenabled

25

AstraZeneca Sweden Operations in numbers

AstraZeneca | Sweden

What metricsreally driveyour results?

Confidentiality Notice This file is private and may contain confidential and proprietary information. If you have received this file in error, please notify us and remove it from your system and note that you must not copy, distribute or take any action in reliance on it. Any unauthorized use or disclosure of the contents of this file is not permitted and may be unlawful. AstraZeneca PLC, 2 Kingdom Street, London, W2 6BD, UK, T: +44(0)20 7604 8000, F: +44 (0)20 7604 8151, www.astrazeneca.com

26