Part of Baxter's response to its heparin contamination fiasco has been to bring its scientists together to imagine ways counterfeiters could infiltrate its supply chain and how they would be countered.

Testifying before the U.S. House Energy and Commerce Subcommittee on Oversight and Investigations April 29, Baxter CEO Robert Parkinson explained the concept: "We have convened a group of Baxter scientists whose mission will be to consider how would-be counterfeiters or saboteurs might threaten our supply chain, much the way that law enforcement or national security agencies have groups dedicated to thinking like potential enemies."

By trying to "anticipate the unanticipated," Baxter hopes to prevent future threats to its supply chain.

The other aspect of the corrective actions Parkinson outlined is a re-examination of its global supply chain practices, to assess whether there are vulnerabilities beyond its direct suppliers, beginning with a thorough review of its China-based suppliers and their sources. Based on the results of the evaluation, Baxter will set targeted prevention and detection methods on its suppliers to limit exposure to vulnerabilities in their supply chains.

Baxter Wants New Industry Standard

The company would like to see its approach to threat evaluation expand to the industry as a whole.

"We believe this type of supply chain threat evaluation is something the FDA and the global regulatory community ought to require more broadly of industry participants. Moreover, we would encourage these agencies to facilitate collaboration on and sharing of these efforts, since the positive changes that could result will be effective only if they are consistently applied and enforced across the industry," Parkinson testified.

Baxter's initiative could go far in cleaning up the image of the company formed by those investigating how its U.S. heparin supply became adulterated, resulting in adverse events and at least 81 deaths in patients.

Congressional investigator David Nelson let it be known at the hearing that he feels contaminated heparin made it into Baxter's system because of the company's lax oversight of its heparin active pharmaceutical ingredient supplier in China.

He and Janet Woodcock, head of U.S. FDA's Center for Drug Evaluation and Research, testified that the contaminant in heparin was over-sulfated chondroitin sulfate, a substance that mimics heparin in routine testing (Also see "U.S. FDA’s Poor Performance ‘Invites Catastrophe’ – U.S. Congressional Committee On Heparin Investigation" - Scrip, 30 April, 2008.).

Contamination For Profit

"The highest probability is that [the addition of OSCS] was intentional. It's hard to determine how it could have been introduced accidentally," Woodcock said. She noted that FDA has traced the contaminant to 12 different Chinese companies and found it in heparin batches shipped to 11 countries.

Nelson, who is spearheading the committee's investigation, seconded Woodcock's opinion. He said a financial incentive to suppliers of crude heparin, derived from the mucus lining of pig intestines, may be behind the substitution of OSCS for heparin. He explained that OSCS is about "100 times less expensive" than real heparin.

The subcommittee grilled Parkinson on the firm's September 2007 audit of the Changzhou, China, plant, which was set up by Waunakee, Wisc.-based Scientific Protein Laboratories to produce the heparin API. According to Nelson, the results of Baxter's audit "differ significantly from those reported by FDA" in the agency's own inspection just five months later. Any problems found in the audit were "satisfactorily closed out" by Baxter's audit team the following February.

The same month that Baxter closed out its audit of the Changzhou plant, FDA conducted an inspection and found the plant was not fit to be operational and that it was not compliant with good manufacturing practices. The agency issued a Form 483 to SPL for a number of objectionable practices after inspecting the facility and, on April 21, issued a warning letter.

Nelson's testimony suggests that Baxter's approach to the inspection created an environment that encouraged taking short-cuts.

"An obvious question that must be asked in relation to FDA's inspection findings is why Baxter obtained drug product from a facility that FDA found to be unsuitable?" Nelson asked. "More specifically, what due diligence did Baxter perform that it could safely manufacture heparin API for the U.S. market before using this facility?"

Nelson observed that the congressional staff found a number of items that Baxter should have taken as warning signals, but ignored, including the fact that FDA had not inspected the plant and that Chinese authorities considered it to be a chemical plant and not a licensed pharmaceutical plant.

"It seems very odd that Baxter accepted the risks of using this facility to obtain the API used to manufacture a sterile biologic without an FDA inspection," he said.

While subcommittee members and Nelson doubted that the plant's condition could have changed so rapidly between Baxter's September 2007 audit and FDA's February 2008 inspection, Nelson pointed out the inspections differed in thoroughness.

"Baxter had one person going there for one day. FDA, for a plant of this complexity, usually takes a couple of weeks if it was here in the U.S., sent two inspectors - a chemist to review the laboratory practices - and an investigator" to conduct a GMP investigation, he said. He added that FDA had five days to conduct its inspection.

"So, if you want a measure of how hard people were looking, time alone would suggest the difference between what FDA was looking for and what Baxter was looking for," Nelson added. However, he said Baxter should have had the "same concern about quality." Asked to grade Baxter's inspection, Nelson said he would give it an "incomplete" at best, "bordering on failure."

Parkinson maintained that Baxter's inspection included checking documentation and procedures associated with incoming materials and sampling, and that the company tested every lot of product it received. However, OSCS could not be detected using the previously accepted testing. He said new tests tried in recent weeks, such as nuclear magnetic resonance spectroscopy and capillary electrophoresis, were able to detect the OSCS contaminant and that use of those tests confirmed the contaminant found in the API was also present in the crude heparin supply.

Holding Manufacturers Accountable

Comments from lawmakers and regulators alike at a previous hearing before the U.S. Senate HELP Committee emphasized that while FDA's role in the heparin situation has been under scrutiny, those who manufacture and distribute pharmaceutical and biological products will be the ones ultimately held responsible for the purity of those products.

Janet Woodcock testified at the April 24 hearing that "the remedy is actually very straightforward, and this approach is taken in other manufacturing sectors: all parties throughout the supply chain from the production of the API and the ingredients, through the brokers, through distributors, through importers to finished product manufacturers, must be held responsible."

"They are the ones who must be held responsible for assuring the quality and integrity of the products they produce," Woodcock said. "The FDA or any other worldwide regulator cannot test quality into products, and we cannot inspect quality into products."

Senate HELP Chairman Edward Kennedy, D-Mass., also emphasized the responsibility drug manufacturers must take in overseeing their suppliers as he discussed new drug safety legislation being developed.

Woodcock said new resources and authority provided to FDA through legislation in development would enable it to hold all parties accountable for quality. At the later House hearing, Woodcock said keeping inspections of foreign facilities up-to-date would cost $225 million more per year than is currently spent. One idea House Energy and Commerce Chairman John Dingell, D-Mich., has circulated is to support FDA inspections of overseas producers with annual registration fees (Also see "Foreign Drug Inspections Would Be Funded By Registration Fees In Draft U.S. Bill" - Scrip, 21 April, 2008.).

- Scott Steinke (s.steinke@elsevier.com), Katie Stevenson (k.stevenson@elsevier.com), Daniel Poppy (d.poppy@elsevier.com)

[Editor's note: This article also appeared May 12, 2008 in "The Pink Sheet".]

Baxter’s War Games: Post-Heparin, Scientists Consider Supply Chain Threats

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