Chemical outsourcing

Table A.4, taken from the CCPS Guidelines for Chemical Reactivity Evaluation and Application to Process Design, shows the questions which need to be asked regarding the safety of the proposed reaction, the data required to answer those questions and some selected methods of investigation. The experimental analysis is extremely specialized, and companies should consider outsourcing the tests if they do not have specialists in this area.

This guideline describes methods to help the chemical processing industry apply the CCPS chemical process safety concepts to outsourced manufacturing operations, specifically the tolling vendor-client relationship. In addition to the focus on process safety, information and examples provided in this text foster good practices relative to community and worker health, and environmental responsibility. 

Toller An outsourced manufacturing company contracted to process materials to another company s specifications. Sometimes called third party service provider, toll processor, supplier of outside services, external contract manufacturer, contract processor, contract manufacturer, custom chemical manufacturer. 

Guidelines for process safety in outsourced manufacturing oerations / Center for Chemical Process Safety, p. cm. 

Even without the current outsourcing trends, it has always been difficult for service companies to find sufficient numbers of well-trained, experienced, and motivated field representatives. This is because the range of water treatment problems and potential solutions are very wide and the business involves the marketing of many different types of chemicals and equipment, coupled with consulting work and innovative trouble shooting. 

This applies to contract personnel as well as employees. How to communicate chemical reactivity hazards is not a trivial matter, especially when contractors are involved. Confidentiality agreements may need to be put into place, and issues may need to be addressed on a case by case basis. Communication with contract personnel and broader outsourced manufacturing issues are addressed by Early (1996) and CCPS (2000). 

CCPS 2000. Guidelines for Process Safety in Outsourced Manufacturing Operations. New York American Institute of Chemical Engineers-Center for Chemical Process Safety. 

Whereas the overall demand for outsourced pharmaceutical fine chemicals is expected to increase moderately (see Chapter 15), the estimated annual growth rates for the abovementioned niche technologies are much higher. Microreactors and the SMB separation technology are expected grow at a rate of even 50-100% per year It has to be realized, however, that the size of the accessible market typically does not exceed a few hundred tons per year ... 

One can also say that the merchant value corresponds to the actual aggregated sales revenues of the fine-chemical industry, whereas the total value is the theoretically achievable revenue, if all fine-chemical requirements were outsourced. 

The roots of the big and medium pharma companies go back either to drugstores or chemical companies, the former prevailing in United States the latter, in European enterprises. The lack of a chemical manufacturing history is also a reason why US pharma companies en principe are more prone to outsourcing. 

A limited competition and substantial unmet needs would describe a favorable working environment for business development. For custom manufacturing, neither is the case nowadays. The number of fine-chemical companies and the global GMP fine-chemical production capacity have increased more rapidly than demand since 2000. Also, the reluctance of pharma to outsource has increased (see Chapter 10). 

Custom manufacturing (CM) signifies the Konigsdisziplin, that is, the most prominent activity of the fine-chemical industry. Because of their long experience in safeguarding the intellectual property interests of its customers, it is the stronghold of the Western companies. CM is the antonym of outsourcing. 

In order to identify the success factors for custom manufacturing, an antagonistic approach is recommended the selection criteria for outsourcing partners, as established by a major pharmaceutical company, are listed in Appendix A.6. Those fine-chemical companies, which best comply with the 28 criteria, obviously have the best chance to become suppliers. The ranking is typically based on an extensive audit of the prospective supplier. 

Outsourcing policy Pharma abandons chemical manufacture of APIs in <-favor of outsourcing Pharma reverts to outsourcing only as last resort in case of capacity constraints or hazardous chemistry... 

The first two entries listed in the table, namely, Obsolescence of the big pharma business model and Slump in R D productivity, are of particular relevance to the fine-chemical industry and are dealt with in more detail in the following two sections. They impact the outsourcing policy and consequently the demand for new PFCs. 

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