Contract Packaging: Launching New Products with Contract Packagers
Contract packagers are often the best equipped to scale up operations to meet launch deadlines.
In the pharmaceutical industry, launch situations are critical because the stakes—and the costs—are high. “You have to be on time with a launch every time,” says Rick Sury, vice president of sales, contract packaging and specialty cartons, Alcan Packaging (Bethlehem, PA). Companies have long memories regarding any factor that slows things down. “If they’re losing $1 million a day, they start to lose their sense of humor very quickly,” Sury says.
Because they devote their best designers, engineers, and other resources to being on time, on budget, and on quality, contract packagers can be a true asset in a launch situation. “Launching a new product is a tremendous responsibility,” says Shawn Reilley, senior vice president of sales and marketing, Anderson Packaging (Rockford, IL). “It’s never taken for granted.”
Ready For Take-Off
Part of the advantage of working with a contract packager on a launch is simply that they launch often. Anderson, for instance, averages 10 to 15 launches per year, reports Reilley. “One of our customers just mentioned that they haven’t launched a new product in four years,” says Justin Schroeder, the firm’s marketing and business development manager. “They have a vested interest in letting us do it for them.”
Cardinal Health assists in the launch of as many as six to seven products per year, reports Renard Jackson, executive vice president of sales and business development, packaging services. These have included such major products as Celebrex for Pfizer and Crestor for AstraZeneca. When it comes to launches, organizations are looking for speed and “the ability to be able to respond when FDA says ‘Go,’” says Jackson.
Contract packagers are good at building tight, efficient product timelines. “A lot of things can be done concurrently,” says Howard Thau, director of marketing at Sonic Packaging (Westwood, NJ). For instance, stability samples can be created at the same time artwork is being selected and designed. “We can handle multiple stages of the program simultaneously,” Thau says.
Project management, a service offered by many contract packagers, can keep the process moving along, says William J. Walker, vice president of sales and marketing at Sharp Corp. (Conshohocken, PA). “Project management is the single most important function to reduce time to market and to ensure a smooth launch,” he says. The project manager coordinates customer and internal contacts against an agreed-upon set of critical launch milestones. “The ability of the project manager to multitask across all required disciplines becomes the critical link to a successful launch,” Walker says.
Flexibility and Capacity
Contract packagers are also in a position to be flexible—in both capacity and packaging options. “For contract packagers, flexibility is a very big thing,” says Richard Misdom, director of business development at CWS Contract Packaging (Norwich, NY). “Their whole life depends upon whether their customer is satisfied or not.” This means packagers are motivated to overcome any challenges and offer a variety of services.
“We’re able to bring several unique technologies to the table on the initial meeting,” says Thau. Customers then have a choice of two or three different delivery systems, for instance, and can consider the pros and cons of each.
Many contract packagers can also help with the collateral material that accompanies a launch. This material might include starter kits, detail units, and patient education pieces, according to Joe Lally, marketing manager, packaging for pharmaceuticals, at Howell Packaging (Elmira, NY). “At Howell Packaging we have extensive experience in the design, production, assembly, and distribution of product- launch collateral materials,” Lally says.
The “instantly available capacity” at contract packaging facilities is ideal for product launches, says Reilley. “We have primary-packaging lines that can be available in a matter of weeks,” he explains, adding that the company purchases additional capacity as needed to maintain that standard.
“We build our capabilities around being able to be responsive and flexible,” says Cardinal’s Jackson. For smaller launches, this might mean beginning with manual labor and adding automation later to reduce the cost base. For larger launches, it might mean prebuilding and automation from the outset. “We have the capability to scale into it,” says Jackson. “Always, the first focus is speed to market.”
Because there is never a guarantee about the success of a new product, launching with a contract packager gives companies the chance to look before they leap, with regard to capital investment. “No matter how sophisticated the marketing plan, new products inherently have a degree of uncertainty with respect to their ultimate success,” says Lally. “Utilizing a contract packager provides a hedge against this uncertainty. A client can gauge market demand for a period of time before making a decision to bring production in-house.”
Suppliers and Equipment
Contract packagers also have validated equipment and preferred suppliers at the ready to tackle launch projects quickly. “We are accustomed to having multiple changeovers and to meeting market needs and regulatory requirements,” says Steve Dilts, director of sales and marketing at Unicep Packaging Inc. (Sandpoint, ID). Rather than investigate equipment vendors, make purchases, and validate processes, companies can make use of packaging lines already in place and shorten time to market. “We’ve saved them those steps,” Dilts says.
Anderson Packaging maintains one or two preferred suppliers in each key area, with the goal of maintaining competitive cost and quick turnaround. “We partner with the finest companies in the country when it comes to those areas,” says Reilley.
Cardinal Health facilitates tight launch times through integration, says Jackson. With its own insert manufacturing plant, as well as other facilities, Cardinal can build prelaunch quantities of all components. “We are horizontally integrated and have complete control over manufacturing those components,” Jackson says.
For the Celebrex launch, insert artwork was flown to the Cardinal facility, which began producing inserts within eight hours of FDA approval. Within 10 hours, those inserts were being loaded into prebuilt cartons, and finished product was being loaded onto pallets within 12 to 14 hours. “Other organizations simply don’t have that flexibility,” Jackson says.
Working with a contract packager can also give companies access to specialized equipment—such as the modified blow-fill-seal equipment at Unicep—that may be difficult for companies to bring in-house, according to Dilts. And if a customer needs additional equipment, such as custom tooling or a special pump to take a product through the manufacturing process, the company keeps an open mind about adding to its capabilities.
During the past two years, Unicep has added formulating and secondary packaging capabilities in response to requests to handle filling and mixing, as well as the complete market-ready packaging of products. “It makes sense for our customers, as often as possible, to purchase a turnkey product,” says Dilts, “rather than customers working with five different vendors to bring one product to market.”
By relieving companies of the need for equipment investments, contract packagers can save time and money in a launch situation. “Contract packagers have a very large equipment base, often reducing the need to order packaging equipment to support a launch. This translates into reduced lead time and capital costs,” says Walker. Contract packagers can also subsidize a customer’s internal launch with additional capacity that might be needed to build a pipeline, Walker adds.
Contract packagers can also offer design help that can save time and money. Packaging Insights & Carton Services (Norris, TN) has a graphics and design group that provides design and creative services. “Some companies have been able to eliminate the need for design and ad firms by working directly with us and having our artists and design professionals present options for consumer, OTC, and the prescription-drug markets,” says Paul Glintenkamp, director of pharmaceutical packaging.
Anderson Packaging employs pharmaceutical packaging engineers who “form a professional base to create innovative packaging designs,” as well as industry-standard packaging options, according to Reilley.
Howell’s designers help customers ensure that finished packages can be produced in high volume at production-level speed. “There are many ways to differentiate your product and create a unique look, but avoiding odd package constructions that can severely limit line speed is highly recommended,” says Lally. “Our structural design approach stresses unique, creative packages that are suited for high-speed production.”
If they are brought in for the materials selection process, contract packagers can often save testing time by suggesting the best likely candidates and steering away from materials that obviously won’t work. “We have a broad range of knowledge on hand, based on past experiences with a wide variety of projects,” says Dilts of Unicep. They can also alert customers to nonstandard materials choices that will require longer lead times—either because the product must be imported, or because the supplier doesn’t keep as much of it on hand, Dilts says.
In secondary packaging, contract packagers can also help with lead-time and performance issues by identifying the right material for the right job, says CWS’s Misdom. “We try to give them enough options,” he says. “Providing samples of what they can expect is very, very helpful.”
One other element that has a huge impact on the launch timeline is validation. “Prior to a launch, we often perform engineering studies that provide us information prior to validation for process control, reliability of performance, and target ranges,” Glintenkamp says. “We can often help the process by partnering with the customer’s engineering group to agree upon validation templates, approach, timelines, and acceptance criteria.”
Lead times for constructing and validating new packaging lines at large pharmaceutical companies are longer than at contract packagers, according to Lally. Because contract packagers have to be flexible enough to deal with multiple customers and provide a wide variety of line configurations, “contract packagers are well equipped to deal with the compressed timelines of product launches,” he says.
Thau advises tackling validation from the outset. He suggests selecting a packager that has experience working with the chosen packaging solution, including proper equipment and necessary validation protocols. “Make sure that this style of packaging is the vendor’s core competency,” he says.
Because just as selecting the right contract packager can speed a launch along, choosing one not suited to the needs of your project can be a costly mistake. As Dilts puts it, because the cost of a product launch is so high to begin with, “you don’t want to pay for it more than once.”