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Project management – underpinning success in the biopharmaceutical industry

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Project Management
underpinning success in the biopharmaceutical industry
G.O Regester, E. Johnstone, S. Milner
GroPep Limited, PO Box 10065 Adelaide SA, 5000
Corresponding Author :
Dr G. Regester,
Project Management Office,
GroPep Limited, PO Box 10065,
Adelaide, South Australia 5000.
Email :

Summary :
Once the domain of construction and information technology sectors, Project
Management has become firmly entrenched in the Biopharmaceutical industry, where the
implications of schedule, scope and cost overrun, can make or break an efficient drug
development program. Superimposed on this, the requirement for uncompromised quality
standards across all parts of the development pipeline is driving the need for stringent
scheduling, risk assessment and quality assurance built into the management plan. In this
paper we review some typical requirements engaging project management in today’s
Biopharmaceutical industry. Several of these processes have been described at a recent
gathering of project management representatives from the US Biopharmaceutical
industry (PMB, 2005).

Utility in the Biopharmaceutical Industry :
The biopharmaceutical sector is arguably one of the largest consumer benefiting industry
on the global stage. The industry is characterised by a highly educated and self directed
work force operating inside multi-functional organisations with a combination of focus
areas (projects) and core resources. The speed and quality of decision making and task
execution are critical competitive differentiators between success and failure in this
industry, hence Project Management now holds a pivotal role in expediting product
development time and subsequent market launch of new drugs.

The ability of drug development companies to deliver project objectives on time, within
budget and to required regulatory standards has been critical to their success in recent
years. The past five years has seen emergence of the project management office (PMO)
within Biopharmaceutical companies in the US, and a measurable increase in new drug
success rates (PMB, 2005). Realising the benefits of effective management, drug
companies now employ project management tools to coordinate and monitor complex
projects and product portfolios.
With more that 300 blockbuster drugs currently on market, each netting over $1US
billion annually (Scrip, 2005), and industry growth forecast over the next 5 years, the role
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of project management in Biopharmaceutical development will expand dramatically.
Upsizing the PMO will also be driven by drug regulators ie. Federal Drug Administration
(FDA) and the Australian Therapeutic Goods Administration (TGA), where the
requirements for supportive project infra-structure, traceable documentation and
validated quality systems are non negotiable. Global drug development in today’s
industry is typically undertaken within a structured project environment with members of
the project team including external contract agencies, responsible for pre-specified
deliverables. Project Managers within this highly matrixed industry deal with multiple
activities on different levels and often highly complex stake-holder interactions. In
support of this, disciplined project management processes coordinating integrated teams
allow for the cost effective and co-ordinated delivery of project goals.
In Biopharmaceutical development, the discipline of project management also serves to
reduce the functional silo mentality, while a matrix management system aligns the
company functions with project needs. The industry has found that project management
also allows greater transparency and flexibility across different parts of the organisation,
efficient resource utilisation, enhanced performance metrics and a focussed contact point
for internal and external stake-holders, and sponsors.

Project Structures :
The practice of segmenting the project plan into smaller units for purposes of
“management ease” is not a new concept, but is applied widely in the Biopharmaceutical
industry. Project gating is conducted by a majority (>90%) of large drug development
companies (PMB, 2005) and is particularly suited to an industry where project durations
of up to 15 years from concept to launch are not unusual. Typical stages in the drug
development process from concept to launch are indicated in Figure 1.

Figure 1. Application of Stage Gating to the Biopharmaceutical Development Pipeline

# of Drugs
Human Trials

14 Years from Discovery to Launch
Project risk increases with time
Application of stage gating varies depending on project scale, scope and internal resource allocation. Typically, there are three forms of gating reported across the drug development pipeline. #1. In its broadest sense, the total development path is managed as one project ie. a single project plan is established covering the project’s complete Next Page
lifecycle. While this approach avoids mid stream hand-offs and plan changes, it isn’t
always satisfactory for long project durations and relies heavily on adaptable plans that
will support direction in the later project stages. Such rigidity is often not possible with
drug development projects, especially those which are highly technical and risky in terms
of demonstrating efficacy and or safety.
#2. The most applied form of gating treats each major phase of the drug development
process independently. Typically there are three phases – discovery (R&D), exploratory
development (preclinical) and full development (human trials & regulatory). These
segments of work are still broad and may span years in their duration, but can be piloted
as sub-projects against the larger plan. While there is greater focus and ability to plan
more accurately across shorter work stages, there remains inherent risk of change over
the time course of these segments; hence some flexibility must exist in management style
and structure.
#3. The final gating option segments the plan even further. Within the three development
stages, smaller significant milestones can be reached. For example, drug toxicology
testing, Phase I (safety), II (efficacy) and III (pivotal) human clinical trials are individual
and overlapping activities within the clinical program and can be managed as such.
Similarly, achieving regulatory approvals and completing individual pre-clinical
experiments are smaller segments of the overall project plan which can be individually
managed. This approach involves significant process, and often replication of project
management tasks. It is perhaps better suited to companies with adequate management
resources who desire milestone reporting at frequent “end of gate” intervals, for example
companies in the public sector.
Project Risk :
The Biopharmaceutical industry offers a challenging risk management environment. It is
highly regulated, with long time frames, utilises complex processes and has a low
(expected) success rate. Typically, larger established companies are applying best
practice methods to manage risk while smaller less mature industries, notable in
Australia, are not yet positioned to address risk in a formal manner.

Risk management practices are increasingly the focus of drug regulators including the
USA’s Food and Drug Administration (FDA), the European Agency for Evaluation of
Medicinal Products (EMEA) and Australia’s Therapeutic Goods Administration (TGA).
Risk management has been adopted by the International Conference for Harmonisation
(ICH) as a quality topic, while the FDA has recently published risk management
guidance documents, including “Pre-marketing Risk Assessment and Development” and
use of “Risk Minimisation Action Plans”. The Australian regulators (TGA) also have
risk management on the agenda with the Medical Devices Regulations (2002) requiring a
formal risk analysis of devices on the Australian Register of Therapeutic Goods.
Risk assessment forms an integral part of drug development project planning, with
attention to the upper 20% of high risk entities being normal practice (PMB, 2005). A
variety of techniques are employed for qualitative and quantitative risk assessment, which
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in some businesses can also accommodate opportunity identification. At a minimum, companies report formation of a risk breakdown structure (RBS) and a risk response plan (RRP) incorporated within the project plan. There is normally a process of interactive team-based risk identification, analysis and resolution strategies that also provide a reporting format into senior management. Table 1. Common Sources of Risk or Uncertainty in Biopharmaceutical Projects . Team skill levels & staff turnover Risk identification tools reported by the biopharmaceutical industry are no different to other industries; these include documentation review, team brainstorming sessions, the Crawford slip technique (wall notes), Delphi and diagramming procedures. Outcomes may be analysed through either quantitative and qualitative means to arrive at a probability forecast and to weigh risk impact. Biopharmaceuticals is classically a high risk industry with a relatively low expected success rate. It is however an industry with high probability of new opportunity development, ie. the complexity of process and number of concurrent activities is vast, meaning a reasonable probability of new finds or improved technologies. Consequently, opportunity analysis is often conducted as part of the risk analysis process. Spin-offs directed to the companies Intellectual Property (IP) portfolio may “for example” include a new patent position on formulation, manufacture, or even a new improved drug entity, as was the case for Viagra (Scrip, 2003). Further, opportunities can arise in the drug development pathway that may speed up submission of an Investigational New Drug (IND) application or drug filing, for example enhanced rate of patient recruitment into clinical trials. Reduction in time to market is a key goal for companies as market exclusivity is finite through the patent protection period. A key challenge for the local industry is to commit resources and time to the practice of effective risk management. While a recent survey suggested 63% of Biotech. Executives believed risk management was important to the success of their companies, many did not believe they had adopted best practises in doing it (DeGaris et al., 2005). Other commentary’s have suggested the Pharma industry could learn a lot from other industries in building effective risk management systems (Scrip, 2005). Next Page
Critical Chain Management :
Critical chain is well suited to the unpredictability of drug development. It manages the
uncertainty associated with time risk, it provides safety for aggressive schedule estimates
and introduces project progress measures. Drug companies are getting better at
identifying critical project “bottlenecks” or constraints, and building in appropriate
schedule buffers. The process for assessing the constraint and correct buffer varies and is
generally a case of forecasting the level of timeline shift through trial and error, however,
Biopharmaceutical project teams generally aim to exploit the constraint “where ever
possible” by focusing on actions that will reduce duration of the overall project. This
could for example mean targeting a larger number of clinical trial sites to ensure rate of
patient recruitment is not restricted.

Critical chain estimates are normally expressed proportionally. For example, the 90/10
estimate fits well with many industries and suggests a 90% chance of completing the task
within the duration, assumes minimal rework, delay or interruptions. Experience shows
however that the 50/50 estimate is a more realistic target in the Biopharmaceutical
industry, and would accommodate ie. repeat preclinical experiments or a lengthened
clinical trial recruitment period (PMB, 2005). The buffered project is generally shorter
overall because the uncertainty of schedule changes is shared between tasks. In its most
progressive form, some drug companies base project reporting solely on degree of
penetration into the buffer zone.
Dictated by limited funds and lacking development experience, smaller
Biopharmaceutical companies often start out with best case project scenarios, eliminating
buffer from their estimates of time and cost. Negative consequences down the track from
an unbuffered project can include, inadequate information for regulatory support and
approvals and insufficient resources for manufacture of drug product and the clinical trial
program. This inturn dramatically reduces project value in the eyes of a potential
commercial partner.

Project History – Lessons Learned :
Best Practise management in the Biopharmaceutical industry now includes maintenance
of an effective lessons learnt data base by the Project Management Office. This resource
provides a description of project issues arisen, that have impacted the plan and that may
have relevance to future areas of the project, or indeed to other company projects. The
information is generally accessible via database and is available to all project team
members and management.

Different types of process for lessons learned have been described in the
Biopharmaceutical industry. Active learning sessions are reported, involving facilitated
team discussion to gain broad understanding of the experience, shared also with a wider
(company) audience. Root cause analysis is common in the preclinical development
stages of a project where proof of concept is not yet demonstrated; it constitutes a
facilitated process to gain comprehensive understanding of a particular topic at causal
level in order to make considered choices on improving future performance eg. selection
of an effective drug dose level or formulation delivery process.

Lessons learned principles are being taken seriously in the Biopharmaceutical industry to
build on collective experience and to improve performance; an effective lessons learned
system has also been demonstrated to strengthen cross functional collaboration (via
facilitated company interaction) and to enhance overall organisational capabilities.
Conclusions :
The greatest challenge for the Biopharmaceutical industry over the next decade will be to
shorten the timeline for development of new drug candidates and to minimise rapidly
escalating development costs. For this reason, Project Management tools are now
entrenched in many emerging and established Biopharmaceutical companies where
control of time, cost and quality are essential to product success. The benefits from
project management are now recognised by major industry players and application of its
principals will expand in-line with the complexity and demands of the drug development

1. PMB 2005 – 2nd annual Project Management for BioPharmaceuticals convention,
Dallas, US. April 2005.
2. R. DeGaris, J.Bingham and D. Raynor D. Risk Management in the BioPharma
industry : ignore it at your peril, Australasian Biotechnology, April 2005
3. Article : Risk management takes centre stage, Scrip magazine, June 2005.
4. Article : Employing the eureka factor, Scrip magazine, October 2003.



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