Pharmaceutical contracts and their importance for the Qualified Person
Pharmaceutical contracts are of great importance not only for the delimitation of general and specific contractual issues in the working relationship, but also for the Qualified Person (QP) involved. This was demonstrated by the great interest in the parallel session on this topic at the 18th QP Forum of the European QP Association on October 12/13, 2023 in Vienna. Almost 75% of participants decided to attend one of the three sessions offered (on site and live online). The session was moderated by Dr. Monika Hupfauf, a lawyer specializing in pharmaceutical law from Vienna, and Dr. Carsten Coors, Vetter Development Services Austria.
After a brief introduction of the legal background with a focus on the EU GMP Guideline Part 1 Chapter 7 "Outsourced activities", important questions that are of interest to QPs in this context were discussed directly, true to the title of the session "What a QP needs to know about pharmaceutical contracts". In the live online session, feedback was collected, among other things, with the help of a web-based survey tool so that a good overview of individual views could be obtained.
The first question or point of discussion concerned the level of detail of a quality assurance agreement (also known as a quality agreement, QA or technical agreement, TA). According to the survey, almost two thirds of respondents prefer a more detailed agreement, while the rest prefer to focus only on the most important points (fig. 1 on p. 20).
The first exciting discussions already took place on site. In any case, it is important to describe who carries out which GMP-related task, as this cannot be individually specified in the regulations. It is essential to define approval procedures for changes and the communication of product or project-related problems, deviations, changes and recalls.
There was greater consensus on the question of whether the quality assurance agreement should be part of the supply agreement (SA) or a separate document. More than 90% prefer a separate version (fig. 2 on p. 20).
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Fig. 1
Fig. 2
Although an "all-in-one" solution offers certain advantages, such as easier (cross-)referencing, more standardized terminology, a lower risk of contradictions and no differences in the date of entry into force, the advantages of a separate document outweigh the disadvantages here:
- Specialization on the actual focus (GMP and legal vs. commercial world)
- Easier integration of the QP
- Better overview (less complex and extensive contracts)
- Commercial conditions are not visible to inspectors and auditors
- Faster update process in case of changes to the contract terms
Most contracts are updated after three to five years (fig. 3).
Fig. 3
And what if such an "updating process" is necessary? A large majority (approx. 90 percent) of respondents see a need for action (fig. 4).
Fig. 4
And what if the QP takes on a contract that doesn't meet their expectations at all? A good two thirds want to renegotiate, while just under a third would leave the contract as it is for the time being (fig. 5 on p. 21).
Fig. 5
The importance of identifying potential risks and liabilities, including any legal problems, was discussed. It is advisable for the QP to at least inform the employer in writing about the facts of the case, possibly with recommendations. Together with the employer, it should then be assessed whether a renegotiation or even a termination of the contract is necessary and possible.
From a contractor's perspective, it is often interesting to ask to what extent questions from other parties in the value chain need to be answered, even if there is no contract in place. Two thirds of respondents believe that this is important (fig. 6 on p. 21).
Fig. 6
In such a case, it should definitely be assessed what the nature and purpose of the request is and enquiries should be made with the actual contractual partner to find out what the status of the requesting company is. In cases of doubt, a QP should ask for internal company support, documented in writing, on how to proceed with such requests. Unintentional disclosure of confidential, sensitive or proprietary information should be avoided.
In July 2023, the European Medicines Agency (EMA) updated its Q&A and discusses the "chain of contracts"1, a construct in which one or more parties (sites/companies) act as signatories in a chain of contracts. This introduces one or more separate legal entities between the client - e.g. the manufacturing authorization holder responsible for QP certification - and a contract manufacturer. The relevant GMP activities are subcontracted via one or more levels. Reason enough to discuss this in this session. The QPs clearly preferred to focus only on direct contracts and not to enter into a contractual relationship with all parties in the value chain (fig. 7).
Fig. 7
A "chain of contracts" may be acceptable as an exception instead of direct written contracts, provided the following principles are observed:
- Traceability of contracts
- Diagram of the supply chain
- Change procedures
- Audits
- Performance evaluations
- Data integrity, archiving, access rights...
Details can be found under the link provided.
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Other topics that were discussed intensively in - cluded:
- Responsibilities of the QP with regard to efficacy and safety of the medicinal product
- Direct QP-QP contracts
- QA/TA for pure buy-sell operations
- GMP obligations vs. contractual conditions:
Resolution of conflicts
In the latter case, it is particularly important for the QP to communicate concerns in good time and to document this communication, including all agreements and decisions. If possible, negotiations and contract amendments should be proposed, also based on a risk assessment.
Dr. Hupfauf and Dr. Carsten Coors will be back at the QP Forum again this year. On 27 November 2024, together with another QP and a lawyer specializing in international employment law, they will moderate a session on the topic of liability and protection of QPs.
About the Author
Wolfgang Schmitt is Vice President at CONCEPT HEIDELBERG and organises and conducts courses and conferences on behalf of the ECA Academy in the areas GMP Systems and Compliance, Qualified Person and GMP-Auditing. He is also Administration Manager of the European QP Association and Member of the Board of Directors of the European GMP-Auditor Association.
Note:
1 https://www.gmp-compliance.org/gmp-news/eu-gmp-chapter-7-is-a-chain-of-contracts-allowed
