For the past 10 years, the production of pharmaceutical ingredients has been outsourced from the US to Asia. But now GMP Consulting firms are seeing companies move this production back onto US soil. This article will discuss some of the reasons behind the shift back to US production bases.

When pharmaceutical companies decided to move the production if Active Pharmaceutical Ingredients (APIs) to Asia, they thought they would be getting a good deal on price. Production costs like labour and premises rent is better value than in the US. However, hidden costs in terms of logistics and communication are making this outsourcing more expensive than they expected.

Quality Problems
The US has been scrutinising the quality of Asian-produced drugs since the contaminated Heparin affair last year which saw death and serious illness across the nation. And we have seen a bigger demand for quality products made on American soil from consumers, healthcare professionals and the pharmaceutical companies. This is because the premises have to comply with GMP regulations and any issues can be quickly traced.

Logistics
Oversees outsourcing requires a massive amount of logistics to be in place and they can cost a lot of money. The costs of this are now hitting home. Translators have to be employed, offices have to be rented or bought and employees from the US have to frequently travel to their oversees partners to check on progress. These expenses on top of the other complications that are involved in oversees outsourcing can add up.

Communication Issues
Translation is often the most difficult factor to overcome when you use a foreign company to produce ingredients. This can make everyday conversations difficult, never mind important and technical information. Pharmaceutical companies also need to take into account the different time zones that the continents are on and this will slow down communication. Consumers and regulators demand instant information and when you have to wait for your partners to start their working day before you can get in touch with them, you put yourself in a difficult position.

Pharmaceutical companies have not seen the high profits that they expected to see after outsourcing their ingredient manufacture to Asia. In fact, by moving your production back to the US you are filling your customers with confidence of quality and can make bigger profits.

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