26.05.2014 |

LOGFILE No. 24/2013 - Outsourcing - Quality Agreements - GMP News

Quality Agreements: How to build a relationship? (Part I)

By Thomas Peither

The choice of a contract manufacturer is long term orientated. Shane Killian, moderator of the Quality Agreement Session at the PDA/FDA Joint Regulatory Conference, compared the relationship between contract giver and acceptor to a marriage.

Everybody who has been married for a long time knows that a relationship goes through good times and bad times. That being said, there must be reliability, trust and willingness to cooperate on both sides.

The conference session in Washington was not about marriage but was focused on the quality agreements necessary in a partnership to produce drugs.

What is the needed framework when a company wants to outsource manufacturing steps? Paula Katz, FDA Acting Branch Chief, Regulatory Policy & Collaboration, FDA, and Rebecca A. Devine, Ph.D., Consultant, presented their views and experiences on this important topic. This article covers the presentation of Paula Katz.

Putting the ‘Quality’ in Quality Agreements

The title of Paula Katz’s presentation was “Putting the ‘Quality’ in Quality Agreements for Contract Manufacturing Operations“. The reasons for outsourcing are quite diverse:

  • Faster, better, stronger production
  • Niche expertise
  • Increased capacity
  • Resource shifting
  • Shorter time to market
  • Temporary solution

And today for nearly every step of drug manufacturing you can find external resources in all parts of the world.

Regulatory References

As a lawyer by training Paula Katz made clear regulatory references to this topic:

501(a)(2)(B): A drug is adulterated if […] methods used in, or facilities or controls used for, manufacturing, processing, packing, or holding do not conform with CGMP.

FDASIA § 711: “CGMP” includes “the implementation of quality oversight and controls over the manufacture of drugs, including the safety of raw materials, materials used in drug manufacturing, and finished drug products.”

  • 21 CFR 210.1: Failure to comply with CGMPs render the drug adulterated and subject to regulatory action.
  • 21 CFR 210.2(b): If a person engages in only some operations, that person need only comply with CGMPs applicable to those operations.
  • 21 CFR 210.3(12): Manufacture, processing, packing, or holding of a drug product includes packaging and labeling operations, testing, and quality control of drug products.

This demonstrates that you cannot ‘contract around’ CGMP and that a quality oversight concerning the procedures at a contractor´s site is a must.

Paula Katz stated that the CGMP regulations do not explicitly require a written quality agreement, but:

  • 21 CFR 211.22(a): QU responsible for approving or rejecting drug products manufactured, processed, packed, or held under contract by another company
  • 21 CFR 211.22(d): QU procedures & responsibilities must be in writing
  • 21 CFR 200.10: contract manufacturers are an extension of the manufacturer’s own facility

In Europe the situation is different from the U.S. There is a requirement for a written quality agreement. (EU Guide to GMP, Sec. 7.1).

In the FDA and ICH guidelines are many references for the necessity of quality agreements.

New FDA Draft Guidance

Paula Katz described the key elements of the FDA draft guidance ‘Contract Manufacturing Arrangements for Drugs: Quality Agreements’ that was published in May 2013.

The scope of the draft is:

  • human drugs, veterinary drugs, biological and biotechnology products, finished products, active pharmaceutical ingredients (APIs or drug substances, or their intermediates), and drug constituents of combination drug/device products
  • “manufacturing” includes processing, packing, holding, labeling operations, testing, and operations of quality unit

She also mentioned the topics that are not covered in the draft guideline:

  • Type A medicated articles and medicated feed, medical devices, dietary supplements, or HCT/Ps
  • qualification activities, auditing, or disqualification of contracted facilities
  • controls related to qualification, auditing, monitoring, or disqualification of suppliers of raw materials or ingredients, including recommendations for Quality Agreements with vendors /suppliers
  • distributors

The document outlines critical roles that are played by both product owners and contracted facility. It further explains how manufacturers should use quality agreements to define, establish and document their responsibilities. The draft emphasizes that quality agreements should

  • Define parties’ responsibilities,
  • Assure full CGMP compliance, and
  • Facilitate consistent delivery of safe and effective medicines.

For that reason a quality agreement is a comprehensive document that defines and establishes obligations and responsibilities of quality units of both parties (contract giver, contract acceptor).  There should be a clear interface to ‘supply agreements’ or ‘technical agreements’.

Practical Tips

Here Paula Katz gave helpful and practical tips to the auditorium


There should be a clear language to define key quality roles and responsibilities:

  • Final approval or rejection of drug product to the market (211.22(a))
  • Cannot be delegated to Contracted Facility or via a Quality Agreement

Contracted facilities

  • CGMPs for all operations performed, including promptly evaluating and addressing manufacturing or quality problems
  • Quality Unit product disposition (e.g., release, reject) decision for each operation it performs


  • Compliance with all CGMPs
  • Product quality
  • Patient safety

There should be described communication expectations and involvement in procedures:

Change Control

Change control can be implemented by the contracted facility

  • Without any notice to the Owner,
  • With notification, but not prior approval by Owner, and
  • Only after Owner reviews and approves.

Important is the question: What risks might the type of change contemplated present to product quality?

It should also be discussed, agreed upon, and procedures should be documented for validation activities required to implement any changes.

No New Regulatory Expectations

Paula Katz stated that there are no new rules at play. The FDA continues to inspect based on FDCA & CGMP regulations, and all parties should continue to be subject to the same requirements

The FDA already routinely requests and reviews evidence of quality agreements (or the lack of quality agreements). In doing so Paula Katz wondered how difficult it is to engage in compliant contract drug manufacturing without a written quality agreement.

Warning Letter Citations

At the end of her presentation Paula Katz showed a lot of excerpts from FDA warning letters that referenced to a lack of compliance between contract giver and contract acceptor.

Some examples of the references:

  • “…Please note that as a contract testing laboratory, it is your responsibility to ensure the integrity of the data generated and that all test results be properly documented, maintained and reported.”
  • Failure to investigate OOS: “Please indicate if all your customers were notified of these failures and date of notification.”
  • “…you failed to address the impact of the observed method deficiencies on the test results provided to your customers and to indicate whether you will inform your customers of the result of such evaluation.”
  • “Your response, however, is inadequate because it does not include an evaluation of the data already provided to your clients, which were generated using the unqualified reference standards and unstandardized titrant solutions. Furthermore, your response does not indicate whether you will inform your customers of the result of such evaluation as it relates to their drug product(s)”
  • “During the inspection, your firm management discussed the possibility of using a third party contractor to perform finished product testing. If you choose to contract with another party to provide release testing activities, then provide in your response to this letter the name and address of this contract laboratory as well as a copy of your quality agreement with the contract laboratory Additionally, describe your plan for testing active ingredients in each of your finished products distributed to the U.S. market.”

In one of our next LOGFILES we will feature part II of this session and present the industries perspective as detailed by Rebecca Devine.


Thomas Peither
Maas & Peither AG - GMP Publishing;
Maas & Peither America, Inc.;
Peither & Consultants GmbH

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