Compliance Under the Radar – Little Recognition, Big Problem

Compliance Under the Radar – Little Recognition, Big Problem


Compliance. Achieving a good compliance record doesn’t show up on the income statement, however failing to comply with regulations can have a devastating effect on a pharmaceutical or medical device company’s top and bottom line.

Regulatory demands are one of the life sciences industry’s biggest pain points, stifling innovation and change, silently increasing overall costs and delaying optimization that could reduce costs. In an age of increased competition and cost-driven business, improvements in the compliance arena can mean a competitive edge, and yet many companies don’t have an efficient compliance process.

Many companies still use the same compliance documentation and processes they have for years, and are unaware or unwilling to change for the better, mostly due to the low consideration and understanding of the benefits a proper compliance process can achieve. While there are a few solutions available, the ideal one has to be a combination of them all: document-driven process optimization combined with superior, cost-efficient, integrated technology tools.

By Ben Arbov, consultant 

A man explaining in a meeting his charts, in front of other peopel

The problem

Regulatory demands are mandatory and increasingly complex in the life sciences industry, forcing businesses to orchestrate an abundance of compliance processes. Failing to have an effective & efficient compliance program can be detrimental to firms, resulting in failed audits, warning letters, increased times for change controls, technology transfers and unadaptable operations.

Adding to that challenge is an international governmental trend to adopt laws around supply chain security, which vary from country to country, making compliance all the more complicated as businesses must comply with each markets’ regulatory bodies in order to sell there.

A site that produces a treatment that will be used in the United States, Europe, Japan, and Australia must comply with all regulations of the FDA, EMEA, PMDA, and TGA. Any compliance program on site must be well aware of each and every one of these regulatory bodies’ specifications or the company will be at risk of failing inspection. For example, something as simple as the file size for an electronic data submission of results can be problematic: the FDA requires a file to be no larger than 1 gigabyte, while the PMDA allows for up to 5. 1 2 

While these specifications may only result in needing to resubmit clinical trial data, it is a microcosm of the intricacies of the different regulator’s requirements. Even if they meet one set of standards, it may or may not be good enough for the other markets in which the company wishes to be active. Without ensuring that each of the requirements is understood thoroughly, the company will be at risk to potentially fail with some regulators and pass with others. In the age of global connectivity, not meeting the expectations of one regulatory agency will have a direct negative impact on the global perception of a life sciences company, even in countries where the local regulatory guidelines were met.

Most compliance procedures start with managing documentation, a laborious task, and a crucial one for business in the life sciences. In the highly regulated environment, providing the reliability and authenticity of documentation is critical. In addition, poor management of documentation can prove to be costly. Hours if not days are spent checking files for completeness, diverting key personnel from their key activities. The most common documented regulatory failures involve not finding the relevant files, either due to misplacement, destruction of files or simply not completing them in a timely manner. 3

A big part of the problem is the lack of innovation and improvement in the documentation process over time. While regulations and the volume of information that needs to be documented increases, many companies still use paper-based documentation, causing failures in the document-driven business processes and stalling the effort of achieving Op-Ex (Operational Excellence) by causing delays in change controls.

Change controls can be a particularly lengthy process, with numerous stakeholders at different locations reviewing and approving every document submitted. The inaccessibility of documents in real time makes the process a sequential one, resulting in long on time deliveries of paper approvals. 4

Documantation life - a graph

Existing solutions

Currently, companies address the problems of compliance with one of two solutions: software based documentation, and external consultants. 

a shade of two computers Software based documentation

These guarantee that all the information and documents are in one place, and easily accessible from a user desktop. They enable a simultaneous global submission of dossiers and documents. Another benefit received from software solutions is the substantial space savings that can be realized, stopping the endless need to meet the demand for paper storage.

While the added technology tool can complement the documentation process by making it a concurrent one, without the proper process optimization this tool is merely that – a tool, and usually an expensive one at that. If not implemented the right way with the appropriate operational optimization, a standalone tech solution will not give a reasonable ROI on the investment cost, and may even increase the risk of falling out of compliance due to a poorly managed change. 

a shade of a group of people External consultants

External consultants usually focus on the strategy side of compliance, including reducing SKUs, restructuring geographical footprints and changing policies. While these solutions to compliance issues are important, they are ignoring the major problems – document-driven business processes. Some companies do get down and dirty with process optimization, but don’t incorporate proper technical tools to achieve the best results. 5

an illustration of a house Internal capabilities 

Some companies will have the internal capabilities to develop strong compliance programs even in a global context. Companies with a global presence may have expertise and experience working with the different regulators which will allow them to maintain compliance in those markets. However, the challenge is when a new market becomes a target for a regulatory inspection, and there is no established expert internally. This is where a life science company can run into problems missing the fine print of a regulator’s guidelines.  

The ideal solution

The ideal solution for the problems helps the life sciences industry achieve higher than ever compliance rates, ensuring a great product with little to no breakdowns due to regulation.
This is done through process optimization for the document-driven business processes, complemented by the proper, cost efficient, technical tools. The combination of solutions allows superior flow in the compliance process, thereby relieving the companies from compliance process constraints.

The solution can be broken down to 4 steps:

The four elements of finding a solution to a probelm1. Diagnosing current state

Every company has different processes in place for compliance matters. In order to tailor the solution to the company, guaranteeing successful assimilation of the solution in the long run, Tefen recommends the following actions:

  • Process mapping
  • Multi-observational studies (MOS) and time studies
  • Interviews with all job functions
  • Technological tools review

2. Designing the solution
After understanding the company’s current problems, a detailed solution can be designed and custom tailored to the company’s needs. These needs may include:

  • Process optimization and redesign
  • Roles and responsibilities design
  • Alignment
  • Technological tools implementation and training
  • Define KPIs

3. Implementing and embedding
Taking the company through the detailed solution, introducing all the relevant personnel to the new changes and additions and training staff, are the next critical steps. This includes embedding a new culture of continuous improvement through newly introduced management routines, and measuring success of pilot programs.

4. Sustaining and improving
The solution doesn’t stop with a quick fix but has details on how to continue improvements. Key performance indicators are defined in the design stage and are now being measured, helping leadership steer the business towards improvements. Governance recommendations and routines are introduced for the sake of sustaining great results. Another method used is the assessment of culture maturation through the use of maturity models. These provide a mechanism to make adjustments and deliver continuous improvements in the future.


As the life sciences industry becomes more competitive and cost driven, preventing compliance issues becomes all the more important. On the positive side, an effective compliance process optimization allows the flexibility needed to optimize all other operational aspects. On the negative side, a slow compliance process hamstrings change management, adding red tape and actually impeding business development and growth, lowers efficiencies dramatically, and impacts other process improvements.

Executives must actively address compliance issues, taking the proactive approach to a high probability, high impact risk. To avoid being blindsided and suffering a major business breakdown. Leadership sponsorship is a must to drive compliance improvement.

A comprehensive approach that tailors solutions to individual companies yields best results. Accompanied by change management tools, routine inspection management, relevant training, and process optimization, a fully integrated process-focused technology-enhanced solution will satisfy the unique requirements that pharmaceutical and medical device companies have in the regulatory field, preventing risks and business breakdowns. Consider this methodology and the significant advantage it will bring to facilities during increasingly competitive times.


1 Food and Drug Administration, n.d. Web.
2 Https:// Pharmaceuticals and Medical Devices Agency, n.d. Web.
3 Navigating a World of Regulations;
4 The Evolution of Document Management in the Pharma Industry;
5 McKinsey & Co, Bain & Co, PwC, and BCG websites

Brian Hsing

Director and Head of US Operations at Tefen USA

Monopoly Building, Operational Excellence, Change Management & Supply Chain Expert

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