Pharma Manufacturers Can Protect Their Brand With Serialization
In an interview at Pharma EXPO 2014 Mac Hashemian, CEO & President, Xyntek discusses the basic needs for implementing a serialization project, and critical mistakes companies make when trying to launch a serialization process. Hashemian also talks about the benefits of patient safety and brand longevity manufacturers can experience from implementing a serialization process.
Interview Transcription:
Todd S: Alright, Todd and Todd, live in Chicago, Life Science Connect Radio's day one coverage from this grand event. Todd, we had the pleasure of spending some time with our next guess pre-show. This promises to be a very interesting and engaging conversation.
Todd Y: I can tell you, when you have a short conversation with somebody and you begin to ask questions and you see some of the insights popping out and you're saying, “I want to talk to this guy a little bit more,” I'm glad he came back.
Todd S: I'm glad he came back, and the enthusiasm and passion for the industry and what he's doing is very exciting. Let's get to it. Say hello to our guest. His name is Mac Hashemian. He's the CEO and President of Xyntek, Inc. Mac, welcome to the show.
Mac: Thank you, gentlemen. Thank you for having me here. I greatly appreciate it.
Todd S: The pleasure is ours, Mac. Thanks for making some time to join us. I know you're very busy on the floor here. Before we get into our conversation, Mac, inform the audience a bit about you and your background.
Mac: My undergraduate and graduate studies are in electrical computer engineering. I used to work at NASA [INAUDIBLE 00:01:21] Air Force Base in Hampton, Virginia on and off. I learned really good wind tunnel controls and automation and robotics and machine vision image processing. Today, I use that set of skills for automation for the life science industry.
Todd S: Todd, methinks this guy has a resume. It makes this conversation interesting. Give us the 10,000-foot view of Xyntek. What do you do? How do you serve your market?
Mac: Xyntek's been in business close to thirty years. Our focus is the life sciences: pharmaceuticals, biotech, medical device companies. We cover both ends of the spectrum, both the R&D and manufacturing. We started in the manufacturing area, in automation or packaging lines, machine vision, robotics, SCATA, MES, compliance, real time controls and automation.
We moved into the process area, and then we chased the automation into the R&D areas, where there's clinical packaging and warehouse management and MES, again, in the clinical areas, and moved all the way upstream to drug discovery. Today, we cover everything from drug discovery to drug evaluation, full pharmaceutical development, non-clinical trials, clinical trials, and submissions to the FDA and all the way to the manufacturing.
Anywhere that we can use hardware and software to automate the process and make it consistent, repeatable, and automated at high speeds – that's our mission.
Todd Y: Very, very comprehensive offering.
Todd S: I was about to say, is that all?
Mac: Yes, and I think that makes us very unique. Yes, those areas, we have specific competition and competitors, but I think the one stop shop that we cover R&D to manufacturing makes us incredibly unique in the applications and thousands of systems we've deployed out there, over the past 25, 26 years.
Todd Y: When we were chatting a little earlier, Mac, we were talking about serialization. That's something that – you bring it up to anybody, and should you implement it? Of course. Everybody wants to implement it. But actually doing that is a little bit more of a challenge. Talk us through the basics of implementing a serialization system.
Mac: The basics of the serialization systems and its turnkey solution, again, as we were talking and trying to set the expectations properly, I think if anyone thinks this is something you can get started and you've got a microwave you're going to get shipped and pull that microwave out of a box and plug it in, it's going to work, I think you're being misled and you're fooling yourself.
Even though you're putting in off the shelf products and configurable products, any two lines beside each other are different and have their own quirks and personalities, just like two different people do. You have to spend a good bit of time defining the URS, the user requirements, the functional specifications, and the detail design for your line, for your plant, for your process.
You have to get buy-in from the entire time. You've got to have the engineering and the automation and controls team on board, you've got to have the business owners and manufacturing on board. You have to have the IT team on board, you have to compliance and regulatory guys on board, and also your marketing team, because the labels have to get redesigned and they've got to get approved by the FDA.
It's an entire team effort, and these large corporations to get the team pulled together, as a coherent, functioning team itself is a challenge, and everyone has to be on board. This is not an IT project, this is not an engineering, automation project of print, apply, and check. It's not all about the reconciliation, it's not about the compliance, it's not about the label design, but it's the entire team has to be involved to make these projects accessible.
Todd S: You've done a number of these lines, Mac. I'm sure there's some critical lessons you've learned. Share some of those, and what are some of the critical mistakes that you're seeing out there?
Mac: Yes, I think trying to rush these projects is a mistake, waiting too long to get started, and then having a fire drill is a mistake. I always say, again, software is always 99 percent complete. The largest, most phenomenal corporations on planet earth – Apple, Microsoft – at the end of the day, with all their resources and people and monies, software comes out with bugs.
You have to be patient to work these bugs out, and then at the end of the day, as much as they're 90 percent off the shelf products, there is a 10 percent fine tuning and configuration and customization for each plant and each customer, and their business process and the way they do their operation and the way they have their line set up, that you have to build the time in to achieve that last ten percent.
We can deliver a very, very standard, off the shelf box, eight to twelve weeks, standard stuff, a little modification in twelve to sixteen weeks, but some of the lines need a lot of customization and they're different and things have to get changed out.
You could be out 24 weeks, and I think setting the client expectations properly, right off the bat, is incredibly important, spending time on the URS, FRS, DDS is, again, very important, just like you spend time on architectural drawings before you build the building.
Then, putting the technology is never the issue. It's rushing up front, “Hurry up, let's get it done,” and then having to retract. Again, being cognizant that this has got to get integrated into a whole new process and people have to buy into it and software is always 99 percent complete – you have to be patient to get it right as a team, with the customer as a seamless team.
Todd Y: Talk a little bit more about that people side of it. You mentioned it's not automation, it's not an IT project, it's not a marketing project. All those people are involved. Design tech is involved. It strikes me that there needs to be some pretty strong leadership in getting this whole project pulled off, so that we do not have finger pointing and things like that.
Mac: I think you hit it on the nail. There has to be one point of contact. There has to be that one project manager that runs the whole project. That person has to understand all those facets, both IT and the technology, automation and controls and machine vision and robotics and servos and moving parts and printing and labeling and reconciling all the serial numbers.
It has to be someone that is a very strong leader and a great communicator and can sell the project to the entire team as a whole vision, and set everybody's expectations properly. I cannot agree with you more, that it has to be a strong leader to pull this entire team together.
Todd Y: Does Xyntek fulfill that leadership role at times, or is it better to have someone within the customer doing that?
Mac: We absolutely fulfill that, and it's not a sales line that I'm giving you, but at the end of the day, we're asked to do that or not, we end up assuming that role because we have to. We have our exclusive partner, Antares, from Italy, that is the number one world leader in terms of the number of systems deployed out there, 400 systems.
Truly, the customers are using it to make product, and these are not pilot lines. They're not just being piloted. We have the fingers and insights and the integration into the Antares organization and their product and their technology. We understand the life science industry for 25, 26-plus years.
We understand packaging lines, we understand machine vision, robotics, automation, real time controls, SCATA, MES, all the way to the IT systems that will be generating, be it sequential numbers or random number generators. At the end of the day, we're asked to do it or not, we always end up, 99 percent, assuming that role because we understand all the facets there.
When we're not asked to assume that role, it just then becomes that much more difficult. We'd rather be asked, and we do provide that service and we do try to get that position so that, at the end of the day, we're fully responsible, A-Z, from the technology to the integration to the documentation to the compliance to the configuration to the integration.
When we're not allowed to assume that role – and at the end of the day, we are still responsible for delivering a turnkey solution – it just becomes even more difficult. But at the end of the day, we have to manage everyone's expectations, and we have to deliver the job.
Todd S: Let's think about compliance and regulatory requirements here for a minute, and go beyond that. It strikes me that there's a lot of organizations out there that are implementing this because they have to. My sense is they ought to want to, because I think serialization has some real benefits long term. Let's talk about that a bit.
Mac: No, you bring a good point, and you actually brought up compliance and regulation first. When the FDA put out the guidelines for compliance and validation and 21 CFR11, for us, as an engineering company, it just made good sense, to do user requirements and functional specs and detailed design and document everything, so that if that system failed, you could bring it up.
Serialization, again, it makes good sense, one from a patient safety point of view, that we do not want to have counterfeit drugs into the supply chain, what value you put on lost human life. The other end is the profitability, the way that impacts the industry and the life sciences and the pharmaceutical companies.
I've heard numbers, and don't quote me, of $75 billion in losses. That's a huge loss, and then when there's a counterfeit in your supply chain and it impacts your brand, what's the loss of opportunity there? It takes a lifetime to build that trust between the brand and the patient and the users and the consumers. When that brand gets hurt -
Todd S: It's one mishap that does it.
Mac: Yes, and you spend gazillions of dollars getting there, and a lifetime, which you cannot buy that time back. When you lose that trust and that brand name goes, again, it takes a lifetime to build that brand name. From just those three facets and prongs, serialization makes sense, right?
We do not want counterfeit stuff coming from overseas, that they've gotten so good at mimicking the label and the packaging and put in saline solution in a vial and getting it to the supply chain and loss of life and loss of profitability for these corporations that spend gobs of money in R&D to get these drugs approved and out to the consumer market.
Then, the hurt to the brand name. It just makes good sense to put it in, regardless of the FDA mandate or not. The investment is worth it because, again, how do you put a number on the loss of the brand?
Todd Y: I don't think you can put a number on that.
Mac: The loss of the brand or loss of life.
Todd Y: There's another aspect to it, that we chatted about a little bit, that's even more concerning for me. Counterfeiting is one thing, but $75 billion is staggering. I can't get my brain around that. But if you think in terms of quality control throughout the entire supply chain, going way, way back to the very beginning of the supply chain, how do you see that as an issue and how we might begin to address it?
Mac: You make a great point. We touched upon this a little bit earlier as well. Another number that I heard – which again, don't quote me on this – 60 to 70 percent of the active ingredients that we use in our drugs, and we make pills out of them and we package them and put them in blisters comes from overseas.
That's not even being addressed here, in the serialization, at this point. That's also part of this equation. How do we address that, the units and the containers that are coming, and how do we make sure that counterfeit raw material is not getting into the supply chain?
Right now, we're not even addressing the raw material coming from overseas, and if 60, 70 percent of active ingredients are coming from overseas, that's a huge number and that needs to be addressed. It takes time to address all of these.
It's not a step function and it's not an immediate response, but we need to put that in the whole equation, to catch the raw material and to ensure that raw material that are coming in are not counterfeit raw material, and the counterfeit barrels and containers are not making it into the supply chain.
Todd S: Are we talking about that? I mean, I hadn't even thought of that idea. What needs to happen to get that started?
Mac: It's not on the table, but I think if enough noise is made about that, just as enough noise was made to get this regulation through the pipeline – nobody likes regulation and the government involved and it costs money, so the industry as a whole needs to address it, if nothing else. That's 60, 70 percent. It's a big number, regardless, even if it's 50 percent.
Todd Y: Even if it's 20 percent, it's still a big issue.
Mac: That's right, and it comes through, and that's what feeds and makes the pills. That has to be addressed as part of this whole big equation, and then taking this – the other thing I mentioned is also clinical packaging areas. That's not being addressed. The packages are being made to go to hospitals and clinics for the studies.
That's not part of the equation at this point. Then, all the way to the pharmacy. That conversation has been had, and even though it's not mandated at this time, it will come, that eventually that reconciliation for that bottle, for that serial number, has to be done all the way to the pharmacy.
Todd Y: Mac, you've identified a lot of different issues that need to be addressed. If you were king, where would you start? What do you think the priorities are and what the industry should do next?
Mac: I mean, I think we're addressing it properly, the industry's addressing it properly, to starting to attack what we can attack immediately, with the serialization mandate. That's on the table.
There's going to be a whole growth in the industry, both from the standpoint of the customers themselves bringing this into their plans, and doing this level of automation and serialization and reconciliation to the unit and so forth and so on, and then all the way to the point of distribution, and then all the way to the consumer level.
Then, addressing the raw material coming into the supply chain. I think there's going to be a whole learning lesson and a learning curve for the industry from the suppliers and technology providers and solution providers like us, to the customers, to the life sciences themselves, and I think one the immediate needs are addressed for the immediate mandates and regulation that's in place, I think the industry will see the benefits of trying to attack the counterfeit issue and the $75 billion and the loss of life, going all the way from the beginning of the supply chain, from the raw material all the way out to the pharmacy.
I think as we get through this phase and this immediate mandate, the industry will grow and the solution providers and the technology providers will grow, and I think, as a result of that, it will make sense to ensure the whole process A-Z's address, and catch the weakest link, because we'll be as good as the weakest link in the chain.
If we're addressing it at the plant level, but then we've got raw material that's being counterfeited and coming in, we understand and we didn't really solve the whole problem, the whole equation, and the equation's not balanced, or all the way to the shipment, to the pharmacy, if somehow or another the counterfeit made it into the supply chain.
But I think you've got to bite at a time, take a piece at a time, address it, learn from it, grow from it, get better from it as an industry, again, from the consumers and the manufacturers themselves to the solution providers like us, and then take a bigger bite, a bigger bite, and then solve the whole problem, from A-Z, from the beginning to the end.
Todd S: That philosophy applies to most anything in life. Xyntek's exhibiting here. Mac, what are you principally showcasing here?
Mac: We're in booth W616. We've got our exclusive partner here, Antares Vision, from Italy. They're showcasing, and we're, together, jointly showcasing a handful of the modules that we have, and we're on the third generation of the software.
I think there's some incredibly key improvements that have been made in the ATS 3.0, and I think we're excited to take the customers through the booth. We have a really nice sized booth there, and quite a bit of the modules there, to demo the process as much as we can here, on the floor.
Todd S: Todd, as I suspected, Mac had plenty of critical insights to share with us, but unfortunately we're running low on time. Mac, before we let you go, how can people get in touch with you and learn more about Xyntek?
Mac: www.XyntekInc.com, or (215)493-7091 are the two best ways. Again, our website is www.Xynteknc.com are the best ways to get ahold of us, and if you're here, please stop at W616. We'd love to meet you in person and demo some of the technology.
Todd S: Mac Hashemian, the CEO and President of Xyntek, Inc., Mac, it was a real pleasure. Thanks for stopping by and joining us.
Mac: I can't thank you enough, gentlemen. I greatly appreciate the opportunity. Thank you Todd and Todd. Thank you, gentlemen.
Todd S: Alright, that wraps this segment. This has been Life Science Connect Radio, Todd and Todd signing off from Chicago, our live coverage. We'll be right back.