Pasi Kemppainen on Managing & Implementing Pharmaceutical Serialisation

Pasi Kemppainen is an executive consultant for serialisation and traceability and currently leading the serialisation implementation at Orion Pharma. In this interview he speaks to Andrea Charles from Pharma IQ, about managing and implementing serialisation and shares his top tip for preparing  for regulation requirements and implementation in the future.

Pharma IQ: What’s really driving serialisation in the global pharmaceutical industry?

P Kemppainen: Obviously everything starts with the established or forthcoming regulation for the drug safety, patient safety and product integrity. I think at the same time the companies are looking for implementing more profound capabilities in implementing better ways of managing the packaging and also the traceability of supply chain. So the driver comes from the regulation but at the same time having the capabilities for serialising and tracing the products along the supply chain, that brings a lot of other advantages where companies can then have a benefit of streamlining their processes and having more cost-efficient operations.

Pharma IQ: In your opinion why has the industry been slow to adopt mass serialisation?

P Kemppainen: Everything comes down to the state of the regulation globally. So mostly it’s unfinished, it’s unclear how the market specific regulations will fall into place. There are a couple of markets which are already fairly well established in terms of regulation, namely Turkey and China, but the other main markets like US and Europe are still in process.
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So when there isn’t any global standards or regulation, which could be implemented at once but you need to implement the local regulation or market requirements one by one always needs a huge investment, not only financially but also knowledge-wise. And that’s something that the companies are very hesitant to do since it requires knowledge, it requires a lot of time to implement the processes and then have the technical implementation in place which need to fulfil the regulatory requirements and that’s really time-consuming and also heavy on investment so that’s why companies are playing really a waiting game here, which is a disadvantage at the same time as well but unfortunately that's really the case.

Pharma IQ: Managing and implementing serialisation is a complex process, what are some of the key challenges companies like Orion are facing?

P Kemppainen: First of all, you need to have a holistic strategy. You need to have a really top-down understanding of what needs to be in place and when and how, and then you need to go down into really having the execution planning on a plant level or on a  subsidiary level how you are going to roll it out because there are a lot of different kinds of processes and systems in place. So the landscape from an IT point of view and a packaging infrastructure point of view, it’s very diverse and fragmented. So we really need to have a top-down understanding of how you standardise that and then bottom-up understanding of how you’re going to execute it. And that’s the kind of a challenge that really brings the complexity.

The solutions, per se, are not that complex but you need to really know how you’re going to need to implement them so that you take into account the special differences between the plants and the markets but at the same time have a holistic, standardised approach so you can standardise as much as possible on a corporate level so that you can achieve cost-efficiency and also the scalability corporate wide.

Pharma IQ: Serialisation is a global problem and there are different regional requirements that are very challenging. What regions are most challenging in your perspective?

P Kemppainen: You really hit the most critical point here. It’s really a global problem but there are no global standards and this is really the key why most of the companies, especially the small pharma companies, are struggling with this, having a global business. So when there is a global problem but not a global solution, but local market driven regulations which dictate what kind of technical implementation and processes needs to be in place, that means that every market being different is as big problem as any other. But if you look at it from the state of readiness from the regulation point of view, which is really driving the implementation here.

So Turkey and China are in that respect quite ready, especially Turkey, but the big markets like US and Europe are really completely open, especially US, which has no interest in dictating any kind of technical implementation, but leaves it completely to the industry to come up with a particular solution where companies need to somehow come up with the common line on how this needs to be done. In Europe, again, it’s a little bit different from the other markets. So China, Turkey, Brazil and maybe India as well are really government driven initiatives where the government takes clear of the technical implementation for traceability. But in Europe it’s really an industry driven initiative where actually the European Commission has delegated or seems to be delegating the responsibility of setting up the technical infrastructure to the stakeholders i.e. the industry.

So all the markets are different but the US in my point of view is the most unclear from the vendor and pharma company point of view since there are not really any kind of specification or standards given by the government to the industry or the markets players on how to proceed.

Pharma IQ :What key lessons did you learn from launching the Original 1 on-demand in China?

P Kemppainen:  In China everything is different when you look inside versus outside. First of all, having a global solution like Original 1 on-demand cloud service and how it operated you need to really start from scratch, building everything locally. You need to have a really strong local team with the local market knowledge and also the access to the different stakeholders, not only the customers and the partners but also the government. Then from the go to market point of view, how you roll it out, how you roll out the service in China, you really need to have an understanding of who are your key customers and how you approach them. China is a huge market, it’s a very diversified market, lots of different kinds of players in the field. Some companies are global, some companies are very local and some companies are some who are in between so you really need to have your focus straight, who are your lead customers and also focus on fulfilling their needs initially and then start rolling out to the other markets, other customers as well.

In addition, you need to really have an understanding of the local operating environment. It’s not only that the customers have access to the partners, the right partners in more detail, but also to the government. You really need to understand whom to talk, what are their interests and how you can help them and they can help you.

In addition to the business side of it, Chinese companies, not small or big ones, are really used to paying for their cloud services. So whatever they ask for or they are willing to pay for, it needs to be somehow tangible, something that they can really put their finger on, like, this has a value. So cloud services are a completely new kind of way of delivering the services, which creates a lot of uneasiness for some decision makers, since they don’t really know how much they are paying for and really is it worth their money and so forth. So you need to really pick and pack your solution so that it has a component which the customers are confident and feel good about purchasing it. For instance, in Original 1 on-demand cloud service we actually pick and packed it in a form of ready labels and so forth, where the actual service was part of the labelling offering rather than standalone service per se.

And then of course the consumer access is vital. So in a case where we talk about drug authentication or any product authentication there is no value of having a capability of serialising and tracing the products along the supply chain if there are no real users. So therefore Original 1 on-demand had 500,000 monthly unique users really scanning the codes for drug packages and then providing the information not only to the government but also to the brand owners and manufacturers, what products are being authenticated, where and when and, you know you are getting the visibility to the marketplace that consumers are really getting the benefit of having the capability of authenticating the products in real-time.

So I would say that the lessons are really diverse. There are a lot of big lessons and small lessons but altogether China is unique. You really need to start from scratch building it locally and building it step by step, baby steps. It takes time, it takes money, it takes right people and right connections but if you are really achieving your targets,  it can happen like with Original 1 that after a length of time you get acquired and the technology will move on to the new customers and new opportunities. But China is unique and that is always good to keep in mind.

Pharma IQ: From your experience of implementing serialisation in the country what would you say was the biggest challenge?

P Kemppainen:  I think that the biggest challenge with regard to serialisation was actually not to do with the technology per se. I think the technology is really straightforward and on-demand was just delivering the service from the cloud most efficiently and easily. But I think the implementation-wise, the challenge was to find the right people, not only in your team but also the right partners, right subcontractors. Then establish the connections with the local authorities and government. Once you achieve that then you are, kind of, a part of the ecosystem and people trust you, and trust is really crucial in China. People want to engage with you, they want to do business with you and once you get really the first key customers in place, you know, then the trust will accumulate and the more people will come to you and they will not probably be as suspicious, being a foreign company operating in China, and then the business will start growing.

And then the actual rolling out the whole service, complying with the local regulations in standards, in China the serialisation standard is really different from other markets and again you need to fulfil the requirements really in detail since the government is really interested, and should be interested, that the implementation follows the guidelines that they are providing.

I think in total the key takeaways from actually implementing the whole serialisation, as I said, it wasn’t really a technology play, it was more setting up your business and fitting yourself in the ecosystem so that the others will see that you are creating the value for them and delivering the value and then being trustworthy.

Pharma IQ: What would be your top tip for preparing regulation requirements and implementation in the future?

P Kemppainen:  It’s always, get started as of now. Engage the top management very early and especially get the commitment because that is something that will be needed in the long-run since the serialisation, whether it happens only in China or whether it’s a global initiative, it’s going to take a lot of time, a lot of resources and a lot of money, a lot of investment. It’s going to change business processes and it’s also going to change the way that the companies are cooperating in the future, especially CMOs and CPOs.

Start acquiring knowledge in the company. I would nominate swat teams, if you will, meaning teams who specialise in serialisation and traceability on a corporate level and then are responsible for distributing and delivering that knowledge to the local side and to the different markets. Engage with others, especially with your subcontractor’s CMOs, CPOs. There are a lot of requirements, especially in EU, which needs the support also from the subcontractors, not only from the brand holder. Standardise as much as possible, not only on technology level but also on a business process level. And when there’s a requirement or, you know, needs that are different from the standard operating procedures then try to minimise those things. It’s going to lead to big deviations in the long run from an implementation point of view if there are too many too local implementations of the serialisation and that obviously leads to higher cost and a diversified knowledge as well.

And also, mentally management should look at this not as a project but as a change process which takes a lot of time. It changes the business process, as discussed. It changes also the, you know, global master data for the product, so what kind of data will be required for the product, not only to manufacture but also for the compliance reasons. And then, as I said, try to have the local teams engaged in supporting the process, standardisation processes as well.

And altogether this is a huge change initiative. It takes time, it takes people, it takes money, but if there’s a committed top management involved and business owner or, you know, change process owner on a top management level that will then help the tough decision making when they really need to have alignment between very diverse operating local entities at the moment.

Pharma IQ:You’re going to be sharing your observations and insights later this year at the Pharmaceutical Serialisation and Traceability Forum, taking place 5th to the 7th of November in Geneva, Switzerland. For anyone else interested in attending or just personally what are you also looking forward to on the agenda?

P Kemppainen:I think whenever there’s something new and something as disruptive as serialisation traceability on the horizon you cannot really undermine or really discourage people from participate in networking and sharing, especially when there are not that many vendors reporting the serialisation implementation and also when there are not that many implementations in place for that particular need. The third angle being then the actual differences in regulations in different markets.

So, acquiring the knowledge, acquiring the understanding and also talking to the other companies operating in this area is crucial to have a really 360 degrees view of what is out there, what is coming, what is possible, what are the risks and also what are the best practices how to proceed. And that happens only by sharing and by meeting people and talking. When you give something you receive something, so I would really encourage people to participate and be active in this community and then hopefully having the advantages of understanding where to start and how to proceed from there.

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