The manufacture of pharmaceuticals is a complex process, comprising numerous steps leading from raw materials to finished product. That finished product is the API, and it is this product, along with the necessary inert ingredients, packaging, and labeling, which the FDA licenses.
To understand what is involved in the manufacture of medicines, we should describe the basic elements of a pharmaceutical manufacturing and supply plan, which includes both obtaining raw materials and using them to create the desired product. A drug maker's plan for manufacturing a given medicine, which must pass muster with the FDA before the agency permits its distribution, contains a number of steps:
• Planning—A strategy for ordering the raw materials.
• Sourcing—Choosing the suppliers that will deliver the goods and services. Suppliers could be domestic or international.
• Making—This is the manufacturing step. Manufacturers schedule activities necessary for production, testing, packaging, and delivery. Manufacturing is also the most timeintensive portion of the supply chain. Manufacturing involves making the API and its conversion to the final dosage form, as mentioned above. More than one manufacturer may be involved, and manufacturing can take place in the United States or abroad. A pharmaceutical company may contract several chemical steps to foreign firms and then import the resulting intermediate compounds needed to complete the manufacture of the API domestically. The manufacturer can also outsource the manufacture of the API abroad; when it does so, the FDA closely monitors those plants. Conversion of API to the final dosage form may occur domestically or be "outsourced'' to a foreign plant.
• Delivering—This is the "logistics'' portion of the manufacturing and supply plan. Companies coordinate the orders from customers and choose transporters who carry the product to customers, such as wholesale distributors and pharmacies. Finally, the pharmacy dispenses the finished medicines to patients.
• Returning—This is the system for receiving defective and excess products back from customers and supporting customers who have problems with delivered products.
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