What Quality Agreements Exist for Pharmaceutical Outsourcing?

In the pharmaceutical industry, many factory production processes are outsourced to Contract Manufacturing Organizations (CMOs). This is often to circumvent capacity problems in their own plants, to make better use of internal resources or simply to be able to carry out production steps that cannot be realized internally. Guidance released by the FDA describes how parties involved in contract drug manufacturing can use quality agreements to delineate their manufacturing activities to ensure compliance with Current Good Manufacturing Practice (CGMP).

According to the FDA, a quality agreement is a comprehensive written agreement between parties involved in the contract manufacturing of drugs that defines and establishes each party's activities in terms of how each will comply with CGMP. Each party engaged in the manufacture of a drug is responsible for ensuring compliance with CGMP for the manufacturing activities it performs.

There are three International Conference on Harmonization (ICH) guidance documents containing relevant CGMP recommendations dedicated to contract manufacturing agreements:

1. Q7 Good Manufacturing Practice Guidance for Active Pharmaceutical Ingredients

This guidance recommends that owners evaluate contract facilities to ensure that contractor sites comply with CGMP for specific operations. Owners should have approved written agreements with contractors that define the manufacturing responsibilities in detail.

2. Q9 Quality Risk Management

This guidance offers a systematic approach to quality risk management by discussing quality risk management principles such as risk assessment, risk communication and risk review. In addition, it provides examples of tools that can be used to make effective risk based decisions in audits or when it comes to arrange quality agreements with contract manufacturers.

3. Q10 Pharmaceutical Quality System

This guidance states that the owner is ultimately responsible for ensuring that processes are in place to assure the control of outsourced activities and the quality of purchased materials. The processes should incorporate quality risk management and include critical activities such as

  • assessing the suitability and competence of potential contractors before outsourcing operations or selecting material suppliers
  • defining the manufacturing responsibilities and communication processes for quality-related activities of the involved parties
  • monitoring and reviewing the performance of the contract facility
  • monitoring incoming ingredients and materials


Documenting CGMP activities in quality agreements

A good documentation of the CGMP activities in quality agreements is essential. The FDA recommends that owners and contractors establish a written quality agreement to describe their respective CGMP-related roles, responsibilities, and activities in drug manufacturing.

The written quality agreement should clearly state which party carries out specific CGMP activities. General terms and conditions such as confidentiality, price or cost issues, delivery terms, etc. are not part of a quality agreement. 

Most quality agreements contain the following sections:

  • Purpose/scope – to cover the nature of contract manufacturing services to be provided
  • Definitions – to ensure that the owner and contractor facility agree in the precise meaning of terms in the quality agreement
  • Resolution of disagreements – to explain how the parties will resolve disagreements about product quality issues or other problems
  • Manufacturing activities – to document quality unit and other activities associated with manufacturing processes as well as control of changes to manufacturing processes
  • Life cycle of, and revisions to, the quality agreement

The FDA guidance also includes different scenarios to illustrate common problems in contract manufacturing agreements. The scenarios demonstrate FDA's current thinking regarding potential ways to resolve problems. If you are interested in these scenarios, we recommend you to download the full FDA guidance document.