The Future of The Local Regulatory Affiliate: Adjusting To Global Strategies, Processes and Expectations

Alistair Davidson, senior director, regulatory affairs, discusses the work of local regulatory affiliates.

Local regulatory affiliates manage most or all the regulatory activities for a particular country or region, in line with global policies, business demands and local laws. Such affiliates either are local employees within the incorporated subsidiaries of the parent organization or are third parties bound to the enterprise by contractual agreements. The affiliates’ functions vary based on the size, status and business plan of the local company. Regulatory affiliates may serve different roles even within the same company.

Due to the ongoing globalization of regulatory standards and compliance expectations, local regulatory affiliates are increasingly stretched by requests for information, submission demands, and the need to affect and comply with corporate policies. In many cases this has not been accompanied by an increase in resources or expertise.

Global regulatory functions often tend to invest more in shortening product development timelines and preapproval regulatory functions and strategy, which can limit resources for the post-approval regulatory work necessary to maintain product licenses throughout a product’s life.

Intricacies of the pharma industry

Based on publicly available financial, headcount and pipeline/product, data revealed in a 2017 study that almost 50 percent of the largest pharmaceutical companies in the world have reached a level of complexity that it is not in line with current profitability. This complexity is deeply embedded within pharmaceutical companies, especially from an operational perspective.

Much sought-after implementation of operational excellence has failed to materialize in the opportunity for companies to innovate and become agile. Complex product portfolios, organizations, processes and geographical footprints also increase a company’s vulnerability to compliance delays and oversights, including late filings and failure to update critical registrations. Over the years, an effort to try to reduce complexity in various individual functions can be observed. However, those efforts have been slow to reach all parts of the organization.

Reconsidering the affiliate

It is therefore natural that the role of the local regulatory affiliate should be re-examined, including what tasks can be done at the affiliate office versus from headquarters or elsewhere. The merits or shortcomings of having an on-the-ground regulatory function in each market needs a detailed case-by-case analysis to ensure the organization is using its resources most effectively.

For example, the technological innovation and advancement in regulatory science, such as the harmonization and standardization of the submission process — via the Common Technical Document (CTD) initially and the electronic-CTD later — and the use of regulatory information management (RIM) systems, have not necessarily improved or simplified the affiliate’s managing and submitting of dossiers.

There is an increasing trend to centralize outsourcing of some global regulatory operations to end-to-end service providers. However, pharmaceutical companies have not yet found a model that allows for easy scalability of these functions to respond to work-volume-dependent scenarios, such as a sudden safety concern, a change in regulation or other workload spikes, that can potentially threaten license compliance status.

Avoiding overwhelm in regulatory work

In one instance, a client made a policy change which led to accommodations for internal and external changes in legislation. Consequently, those changes, albeit small, led to a cascade of required updates. Cases like this can create incremental additions that can overwhelm local systems — especially IT and document management — increasing the risk of expensive workarounds, errors in filings or delays in responding to health authorities.

Often additional time is spent tracking and filing reports on legacy products with low sales and proven safety records, which impacts the capacity and ability of regulatory staff to focus on the key business demands of registering new products and consistently proving compliance.

Local regulatory affiliates should focus on the roles that cannot be done elsewhere, particularly maintaining effective and professional relationships with the health authorities and gathering, interpreting and communicating the evolving regulatory environment in their respective countries. In addition, local regulatory affiliates add most value when assigned to strategic initiatives that align with local business and business development. To achieve this, a host of other tasks can be handled elsewhere, including managing local variations and renewals, reviewing artwork, providing inputs to the change-control process, entering regulatory information data and overseeing the document management system.

One way this can be achieved is through deployment of a centrally managed yet geographically dispersed organization with a wide global footprint that can handle many of the operational requirements. The service provider can offer scalability and flexibility since fluctuations in workload can represent major challenges for companies and the provider can allow them to respond to peaks more efficiently. Other advantages are cost transparency, standardization, complexity reduction and optimized regulatory compliance.

Prescription for local regulatory affiliates

Pressure on regulatory functions from business demands, globalization of compliance expectations and the need to manage functional costs will continue to increase. The convergence of regulations and processes affords multiple opportunities to centralize work. Additional opportunities exist to effectively integrate the local regulatory affiliate role and tasks with other local affiliate functions, such as pharmacovigilance and medical information. The efficiency of delivery and cost of traditional affiliate deliverables also can raise the consistency and quality of output and compliance.

Alistair Davidson is a senior director in PPD’s regulatory affairs.