The Right Capsules Are Important
The rules have changed when it comes to development of products in the pharmaceutical, health and nutritional industries.
Whilst generic and branded companies in the industry struggle with new products, they must also address the needs of new patients. Moreover, the companies must meet the growing productivity demands in the manufacturing industry.
The demand for production to market has increased and consumers today have several choices available to them. Competitive selection and lowering cost demands mean that manufacturing companies must increase production at the same time as improving the performance of the product.
Due to these new rules, cost leadership has become the tune for many pharmaceutical manufacturing companies. One way to maintain cost efficiency is to examine the cost of the raw material. Although this approach is important, it does not lead to a sustainable cost leadership, especially as low cost materials can compromise the product performance.
Capsugel, one of the leading suppliers for empty capsules, has a unique outlook on this matter. The company offers a range of capsule filling equipment and a number of filling ingredients; they have an in-depth knowledge of the customer base. As most supervisors can attest, it is difficult to achieve the speed required of manufacturing equipment with a sticky fill material with poor flow attributes.
Nonetheless, profitability and manufacturing can be achieved with the right mixture of formulation, capsule, and filing equipment. Optimizing the manufacturing process to fully exploit the integrity of the capsule and consistency makes sense. Understanding the influence that each one has can help prevent problems during the developmental stage and increase efficiency, leading to greater productivity.
The company has created a wide range of industry leading capsules designed for optimal performance for all formulation types. The service team has continually requested for feedback from customers on equipment purchase, flow evaluation as well as personnel training to complete the learning loop. With this data on hand, the company is able to determine efficient cost savings, using Savings Reports that are based on cost-in-use.
Fundamental Cost of Manufacturing
The company’s manufacturing cost is driven by the raw material, product processing, expense and yields or finished products. The raw material includes the cost of the material itself as well as the different tests conducted to ensure the formulation content, safety and effectiveness. It is possible to achieve cost savings by working with reliable suppliers that have known and established testing methods. By collaborating with a reliable vendor, one can reduce the cost of testing and in turn, increase lead-time, lower inventory level, free up working capital, and lower holding costs such as insurances and taxes.
A large multi-national pharmaceutical company certified Capsugel as a vendor before taking advantage of it’s testing services. In time, this collaboration saved the company up to $119k a year on the testing of raw materials (including services such as sample collection, inventory savings and testing expense).
A New Look on Capsule Filling – Speed vs. Yields
“Time is money” holds true no matter the business or industry. To deliver a product, the company has to pay for its facilities, which not only include the place but also labor and utilities (the cost of which can fluctuate depending on the volume produced), not to mention insurance and other fixed costs. As production increases, the cost reduces even when the equipment and number of working employees remains the same. The time taken to manufacture goods can be broken into 2 variables – uptime and equipment throughput.
Despite the correlation between speed and cost, increasing production yield has remained the company’s main objective. This is understandable because, in the capsule filling industry, filling the capsules accounts for the cost of the company and not the empty capsules. Increasing the yield produced would cause reductions in losses of materials as well time and energy. Even a small increase in the yield production can have a significant impact on the company financially.
In a review conducted by the Capsugel Technical Service team, an increase of 2/3 yield resulted in an increment of 2 to 4%. Although some changes were conducted using complex solutions, the majority were based on the importance of training personnel and maintenance of the filling equipment.
Company X had been experiencing problems with their joined capsules; an internal inspection revealed that the problem was with one piece of equipment. Following inspection of the Capsugel Technical Service (which caused loss of production time and consistent low yield), a recommendation was made that the counter bearing height be adjusted together with the timing of the movement. This reduced the output of poor joining capsules and resolved the problem. Internal inspection was eliminated and yield increased to 8%; the company saw a $94k annual cost saving from one product alone.
Increasing Speed to Increase Profit
A study conducted by one team indicated that the total savings return from increasing speed is greater than that from increasing production. In the study concerning capsule filling productivity on the cost savings, based on filling productivity and efficiency or cost by the increase of the machine speed, the average productivity savings was estimated at $91k or an annual aggregate savings of $2m.The combined savings for both exceeds the cost spent on empty capsules.
This report supports the conclusion that improving the capsule filling efficiency is not a waste of time. The combined savings exceeded the cost spent on empty capsules used for managed projects. Of particular note, increase in machine speed had a 61% impact on the company’s finances. At an individual level, an increase in the machine speed would yield an average of 14k capsules/hour.
The absence of faster throughput is often due to other manufacturing circumstances, as illustrated below.
Company X invited Capsugel to look at their capsule filling operation. The company had been running below the rated speed for their machine. The factor that was limiting the production increase was a lack of separation of the capsule when the machine was running at high speed. Upon inspection, the team discovered that the vacuum pump was not the right size and that this was the cause of the separation problem. When the problem was corrected, the machine speed was increased to 83% resulting in annual savings of $365k.
Why is there a significant difference in cost savings when comparing speed increase versus yield improvement? The increase in machine speed has finally received the attention that it deserves; companies are now beginning to understand the importance of improving their machine speeds. In previous years, yield lost has been the focus of attention, especially when it came to financial impact on the company. Machine speed had been seen as one of the reasons for yield loss but has never really been given enough attention to realize the real impact it can cause.
Nowadays, companies are discovering how higher throughput can have a greater influence on the company’s financial welfare. Higher throughput enables the company to make better use of the labor and utilities available; it also maximizes the capacity, enabling increased profit for the company without the need for shelling out additional capital to purchase new equipment.
Reducing Downtime Increase Profitability
Data analyses have shown that reduced downtime results in greater savings for the company. The numbers only reflect a downtime of 1 to 2 hours, which may not really reflect the real impact that reduced downtime can have on a company’s financial welfare. In the following case study, it was noted that downtime could be reduced through the implementation of preventative maintenance.
Company J has been experiencing lots of downtime due to a sticking problem with one of their products. The company explained that due to the sticking problem, the machine parts must be cleaned frequently to avoid any problems with the capsule fitting, resulting in high downtime and production delays. To solve this issue, the Capsugel team designed an ejection brush cleaning system to remove the build-ups in the machine, whilst it is running. This has resulted in less downtime for the company and a saving of $32k annually.
Quality Design and Its Impact
To ensure the best productivity result, it is important to plan ahead, especially during the initial phase of design. In order to build a quality product, there are numerous issues that must be considered at the beginning of the process to avoid any problems during the delivery of the product to the end consumer. The concept, known as “quality by design”, is a popular one; it is thought to be the foundation of the Six Sigma Methodologies. Pioneered by Mr Joseph Juran, the Six Sigma Methodologies asserts that quality can be planned and that any problems that are faced are related to how quality was planned during the initial stage.
In order to achieve capsule filling efficiency through Quality by Design, it is important to consider the equipment and the dosing formula. Each formula has its own features and benefits, as well as limitations. Efficiency and profitability then lies with the equipment, formula and the capsule. By understanding the formula and its characteristics and its potential effects on the equipment, it is possible to prevent any problems. For example, a sticky powder would not work with tamping technology because the stickiness makes it difficult to compact. There are times when the powder flow characteristics do not match with the equipment and in such cases, it might be prudent to use the Six Sigma method to adjust the outcome.
A tablet manufacturer had been receiving several complaints about the bitter taste of a capsule that the company was producing. During the manufacturing stage, it was found out that the capsules were joined poorly and as such, the bitter powder coated the segments of the tamping machine. Further analysis revealed that the sticky and gritty powder was not compacted properly, resulting in failure to reach the desired weight and the capsules being filled with more granules. This caused powder loss and the residual powder in the segment caused the bitter taste. To resolve this issue, the team adjusted the equipment so that it had a better fit, reducing the powder loss. As a result, the yield increased by up to 10% as cleaning time was reduced and the machine speed was increased to 25% without sacrificing the weight. Savings were up to nearly $1M and complaints received have dropped significantly.
Measurement – Why it is Crucial for a Company’s Success
Lord William Thomson Kelvin said, “If you cannot measure it, you cannot improve it.” This quote does not only apply to science but also to today’s businesses. Knowing how to measure the driving force behind a business is the key to increasing profit.
Capsugel has developed a comprehensive report, which shows the impact of adjustment on increasing efficiency and overall savings for a company. Before, manufacturing companies would concentrate on machine-related end-points such as waste and downtime, nowadays, by following the report and adjusting these metrics, a real world cost impact can be seen. Companies are now in a better position to plan and put these safeguards in place to protect and increase their productivity.
Company Y had been experiencing several defects after encapsulation. The team quickly identified the problem that caused the defects, which was excessive wear of the machine’s segments. By presenting the report, the team was able to provide the manufacturer with a cost- benefit analysis of replacing the worn out piece(s). The cost of replacing the worn out equipment was much less than the loss that the company was suffering.