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Apr 15, 2009 (Vol. 29, No. 8)

Spotlight on the FDA

Outsourcing Clinicals; Medical Journal Articles; and Contract Manufacturing Liability Issues

  • Companies Liable For CMOs’ Work

    Biopharma and device companies frequently outsource their product manufacturing to a CMO, relying on their established quality systems and personnel to meet regulatory guidelines. 

    Recently, FDA claimed in a Form FD 483 Notice of Observations given at the end of a cGMP inspection that a company that held an FDA approval for a product did not create a quality plan outlining specific requirements for its contract manufacturer. FDA expects the company to now actively audit and verify the effectiveness of its quality plan and to correct past deviations/failures while preventing new ones at its CMO.

    FDA will be increasingly prone to hold companies liable for “failure to sufficiently evaluate and select potential contractors, suppliers, and consultants on the ability to meet specific requirements.” 

    As an arbitrator in contract disputes between manufacturers and CMOs, I am acutely aware that such involvement has tremendous legal consequences under the terms of the agreement between the two parties, especially when a batch fails to meet specifications. In addition, it is a potential legal quagmire when a manufacturing problem arises and the company works with the CMO to analyze and make changes in the process or quality testing to address the problem and the problem continues.

    The underlying legal question that now faces companies and their CMOs is, who has ultimate liability, both under the FDA statutes and under contract law?


Readers' Comments

Posted 05/04/2009 by QA Manager

As a Quality professional in biotech working with a contractor who appears to be overly concerned with their liability, I think the FDA needs to seriously spell out their expectations in a written guidance. Has this been done? I personally do not understand as an IND or NDA holder, where a contractor can be held responsible for how I intend to or ultimatley do use the products I ask them to make for me.

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