Warning: Everything You Know About Med Design Is Wrong

Warning: Everything You Know About Med Design Is Wrong Make Your PLM System the Product Design Utopia to Win Big in Medical Device Whitepaper arenasolutions.com ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 1 arenasolutions.com An Industry Defined By High Hurdles and High Margins Developing a medical device has always been a complex process. Manufacturers must continue to drive innovation while facing ever-intensifying business challenges, including the onslaught of fierce competition, the difficulty of managing globally dispersed teams, and an increasing need to address quality and risk. On top of this already challenging state of affairs, OEMs must also comply with strict and ever- changing regulatory requirements imposed by governing agencies around the globe. So how does a medical device manufacturer navigate this balance beam at high speed? It’s a tall order, because so much is involved in developing a medical device —component change complications are increased, compliance challenges magnified, and risks more dangerous than other industry. After all, human lives are at stake. And every time a medical device company makes a single change to a product design, the government needs to know — and it doesn’t matter whether it’s just a labeling issue or single component change. And here’s where things get really crazy: the medical device industry has such extended regulatory approval cycles that by the time a part is approved — it can be deemed obsolete. Replacing the part means the submission process starts all over again. Gasp. The medical device industry is defined by a number of high hurdles that stand in the way of an OEM’s success. But for those who can overcome these challenges there is the promise of high margins…and vast riches. The only way to manage the entire medical device product lifecycle – from regulatory compliance, to global monitoring, quality assurance, risk management and part nonconformance – is through a holistic approach that brings all of these moving parts together into a single, integrated view. When quality, design control processes, and risk management are embedded as an integral part of the day-to-day product design and development cycle, OEMs can dramatically reduce supply chain oversights, employee missteps and product design errors. Misleading reports that extol the virtues of “best of breed” solutions, so-called “linked” systems, and even the traditional model of isolated systems claim to be able to deliver the holistic solution described above; however, recent evidence points to the contrary. Medical device executives, whose use of siloed systems has led to product delays, scrap, rework and risk exposure, can attest to the painful truth that everything they had been told about medical design control was…wrong. According to an Aberdeen Group report, embedding quality and design control processes within a product lifecycle management (PLM) solution can reduce internal and external failure costs by more than 50 percent and the total cost of quality by 8 percent.1 ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 2 arenasolutions.com For medical device companies, the ideal design environment to avoid risk and ensure quality is a three layer stack: the foundation is a modern cloud-based PLM solution with an extensible architecture to support a range of current and future integrations; next is an embedded quality module with corrective and preventive action (CAPA) capabilities; the final layer are next generation design solution integrations, add-ons — and even component databases — all woven into the PLM-driven design environment. In this medical device-focused whitepaper, we look at strategies and modern solutions that when integrated together can improve quality, streamline design control processes, reduce risk, control design and accelerate innovation. As we search for a utopian medical device design environment, we cover the following topics: • Why PLM? • Advantages of Integrating Quality with PLM • Strategies for Managing REACH and RoHS Risks • How to Reduce Obsolescence and Counterfeit Parts • Extending Your PLM Solution Why PLM? Before we begin to delve into buzzwords, such as “holistic solutions,” “complete quality pictures” and “enterprise-wide visibility”, let’s investigate why PLM is the first step in a medical device company’s plan to reduce risk and ensure quality in their design processes. To start with, PLM was created to allow all product companies — not just medical device OEMs — to better manage documents to streamline their extended supply chain efficiencies, improve cross-functional collaboration and increase enterprise-wide visibility into the design process. By this very function alone — coupled with configurable routing and electronic signatures — companies can reduce costly risks and significantly improve compliance processes. PLM specifically helps medical device OEMs by empowering them with greater management control over their quality documents. This expansive list of quality-related documents includes bill of material (BOM), change orders, design history files (DHF), device master records (DMR), validation and verification certifications, risk management reports and product records. And let’s not forget the need for a well-documented paper trail for 21 CFR Part 11, 21 CFR Part 820 and CAPA. PLM offers greater document control for med device companies by consolidating all design information in one centralized system, enabling OEMs to easily share BOMs with globally dispersed suppliers. Because quality- related documents can be complicated (a DMR is an enormous compilation of records containing the procedures and specifications for a finished medical device), a solution like PLM is necessary to avoid misplacing documents and keeping a tight reign on version control. Collaborative Quality Management Life Cycle Collaborative quality management life cycle Requirements denition and management Build and release management ConstructionTesting Analysis and design Risk management Test management Defect resolution Analytics Dynamic planning Coverage analysis ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 3 arenasolutions.com When quality processes (CAPAs, supplier corrective action requests (SCARs), corrective action requests (CARs), NCMRs, 8D, etc.) are integrated into the PLM system, supply chain teams have access to the quality product records, enabling them to be proactive rather than re-active in managing quality. And because this information is tracked and visible throughout the organization, auditors can quickly and easily verify compliance. Advantages of Integrating Quality with PLM In today’s hyper-competitive medical device market, medical device companies must balance the need to meet increasingly stringent regulations while continuing to innovate quickly and be first to market. To succeed, medical device companies should ensure these quality best practices: • Processes complement one another: Manufacturing, engineering, quality control and compliance management must all work together to control costs and shorten development cycles and retain a ‘First Mover’ advantage. • Compliance becomes part of the culture: Medical device developers must embed compliance into the day-to-day work life of all global teams; otherwise employees will never be able to keep up with, much less meet, the ever changing array of local regulatory requirements. • Ongoing, global monitoring of risks: Again, organizations need to take a holistic monitoring approach to account for the diversity of risks a medical device OEM faces, including lifecycle, compliance, multi-sourcing and inventory risks. • Ensure everyone participates: If the quality process is relegated to an isolated team using an isolated system, it is almost a guarantee that the product will face quality issues. Quality processes must be integrated into the day-to-day product record so that everyone, including members of the extended supply chain, can contribute to producing the highest quality product. LNS Research recently released the results of a quality management survey that showed medical device executives ranked the ability to “better manage operational risk” and “ensuring compliance” as the top two quality management objectives. The roadblocks that executives felt kept them from achieving those goals were “effectively measuring quality metrics” and “disparate quality systems and data sources.” Quality metrics are not eectively measured Quality is considered a “department” not a “responsibility” Disparate quality systems and data sources Lack of visibility into supplier quality No formal process for continuous improvement Engineering lacks feedback on quality Top Quality Management Challenges Ch al le ng es Percentage of Respondents Source: LNS Research 0 10% 20% 30% 40% 50% ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 4 arenasolutions.com How Arena Helped Swan Medical Take Flight Swan Medical’s COO Larry Sampson was frustrated with his company’s CAPA processes. Unreliable and unpredictable design controls were keeping him awake at night. “We suffered from poor internal understanding of process flow and inability to produce corrective evidence,” said Sampson. “Simply put: we had improper information in the specified locations.” Sampson realized he could not depend upon divergent systems to ensure quality. Redundancy and version control issues were creating havoc. “With siloed systems, it was hard enough to get the input correct once, let alone twice in exactly the same way,” said Sampson. The COO knew a holistic PLM-driven approach to quality control was the key to his medical device company’s success. Sampson turned to Arena PLM to streamline his company’s design processes. According to Sampson, Arena PLM’s change management capabilities and document control enabled him to improve processes for creating, reviewing and gaining formal approval for engineering change requests, change orders and change notifications. He also integrated Arena Quality into Arena PLM. “I use all of Arena’s tools together to establish a regulatory compliant standard work flow for predictable outcomes,” said Sampson. “The quality process integration is great, the ECO management capabilities are awesome. Arena allowed me to establish a complete quality and risk management solution that streamlined processes to ensure quality for better business results.” In addition to Arena Quality, Sampson also integrated Arena Projects into the design mix to flexibly track CAPA project progress through customizable phases with assignable milestones and tasks. “When an auditor comes in, it’s useful to have quality processes tied directly with project tasks,” said Sampson. “You can click and show them exactly where you’re at in the project and how much time you expect to complete the CAPA and which aspects of the system you’re touching upon.” Fortunately, with a PLM-based quality solution, processes are embedded into enterprise business systems and other external data sources, producing – as documented by this research — the following business benefits: • Reduction of the cost of quality by up to 3X2 • A 25% increase in operating margin and a 29 percent reduction in failure costs.3 • A reduction of the cost of poor quality (COPQ), which increased earnings 10 to 15%4 When organizations employ disparate systems to manage quality, risk and other key processes, in large part they fail to perform because there is no effective way to retrieve recorded notes, making prior corrective actions difficult to adjudicate and true up. Quality Digest discovered that up to “80 percent of quality issues are repeat issues for which a corrective action has already been identified but does not persist.”5 Because of existing investments in engineering, many companies are implementing quality management systems (QMS) and associated functionalities, such as (CAPA), as an extension of PLM. For engineering-intensive organizations, this helps to incorporate quality processes not only into the design phase, but also into manufacturing, sourcing and business operations. Extending CAPA and other QMS functionalities with PLM strengthens the feedback loop, because it enables stakeholders to take advantage of critical information earlier in the value chain. This rapid iterative process in new product introduction (NPI) results in better-formalized first versions. With a modern PLM solution, medical device manufacturers can develop a unified information management system for engineering and quality, which creates a single point of entry for all product and quality information irrespective of function. Streamlining independent data sources into a centralized system delivers more accurate product information, improves knowledge sharing, supports better design processes, and provides improved visibility into quality information for all stakeholders. It also eliminates the duplication of data in various disconnected systems. The benefit of integrating quality within PLM is clear, but what other tools and strategies can help reduce an increasingly broader array of risks and pains that afflict and ill the medical device industry? Strategies for Managing REACH and RoHS Risks When introducing a new medical device onto the market, organizations should initiate a number of well-defined risk analysis and evaluation phases. Risk management and the performance of risk assessments are key parts of the design, development and control process, because they help ensure that manufacturers fully understand the product and that that designers have fully considered user requirements, the patient and the operator. ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 5 arenasolutions.com At a high level, ISO 14971 defines risk as the “combination of the probability of occurrence of harm and the severity of that harm.” Risk management for medical devices is “the systematic application of management policies, procedures and practices, to the tasks of analyzing, evaluating, monitoring and controlling risk.” The first step in the risk assessment path is to identify the device’s potential hazards and their severity. What does “severity” mean? One person out of a million dying due to a faulty pacemaker is a more severe “risk” than one in ten may suffer minor burns due to poor design of an electrical component. A single death out of a million trumps 10 small injuries in a hundred. Just ask a lawyer. Problems in the design, development and use of the device can often be eliminated with the review of a medical device company’s multidisciplinary team; however, the design, quality, production and operational risk assessment can breakdown as the experts required for the overarching evaluation process tend to focus on only their specific area, losing insight into how other elements beyond their vision can impact design. Providing these different teams with greater enterprise-wide visibility to all processes, while also enabling them to share knowledge with peers outside of their area is one of the key benefits of a modern PLM solution. At a high level, Emergo Group Research recommends that teams participating in the risk assessment and management evaluation process ask these questions: • What is the intended use of the product? • Is energy or a substance delivered to or extracted from the patient? • Is the device to be routinely cleaned or disinfected by the user? • Are measurements taken? Is maintenance or calibration necessary? • Is the medical device susceptible to environmental influences? • Does the medical device have software? • Does the product have a shelf life, and what determines its useful life? • Does product installation or use require special training? Once the risk elements and hazards of the product design are identified, an analysis of each element can be performed. Various types of hazards can include energy, biological, environmental, software, user error, labeling, complexity of use and functional failure. In addition to the Chemicals Regulation REACH (Regulation concerning the Registration, Evaluation, Authorization and Restriction of Chemical substances), medical devices companies who want to sell their products globally must now report frequently on use of the use of certain hazardous substances with RoHS (Restriction of Hazardous Substances) Directives. Table 1: Substances banned by the RoHS Directive Banned Substance Lead (Pb) Cadmium (Cd) Mercury (Hg) Hexavalent Chromium (Hex-Cr) Polybrominated Biphenyls (PBB) Polybrominated Diphenyl Ether (PDBE) 1000 ppm 100 ppm 1000 ppm 1000 ppm 1000 ppm Solder, batteries, ceramic components II-VI compounds, batteries, pigments II-VI compounds, lighting, switches Coatings for metal housings and chassis Flame retardents for plastics RoHS Limit Typical Use ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 6 arenasolutions.com Until recently, the original RoHS compliant exempted medical devices, allowing them to contain an unlimited amount of toxic metals and plastics. Not anymore. RoHS now targets a wide array of medical devices, and will expand to include in-vitro diagnostic devices in 2016. The current list of devices RoHS targets include: • Radiotherapy equipment • Cardiology • Dialysis • Pulmonary ventilators • Nuclear medicine • Laboratory equipment • Other appliances for detecting, preventing, monitoring, treating or alleviating illness, injury or disability Today, environmental regulations are now an integral part of medical device product design. Because of this, OEMs, distributors and contract manufacturers are now using modern component database solutions to manage substance declarations from their supply chains. A component database is the only realistic way to comply with ever-changing compliance mandates and frequent adds to both the REACH and RoHS hit lists. A component database dramatically improves BOM risk management. It provides instant access to component documentation, accurately forecasts components at existing risk, and offers an in-depth look into electronic component lifecycle statuses, multi-sourcing, available inventory, and environmental compliance data. When integrated into a PLM system, a component search engine can help medical device OEMs dramatically reduce risks across the supply chain. How to Reduce Obsolescence and Counterfeit Parts Choosing the right part at the right time is one of the most important aspects of product design. Unfortunately, many medical device companies don’t utilize a standardized method for selecting electronic parts. And relying on archaic management tools like Microsoft Excel to manually manage product data can cause medical device companies to make incorrect selections, as well as waste time. “Manually searching for and selecting components is time consuming and error prone. It can result in incorrect or incomplete part numbers, missing information on various attributes, and a host of other inconveniences and errors,” said Amanda Martin, marketing manager of SiliconExpert, a leading electronic component database. In addition to enabling medical device companies to better manage compliance, a modern database solution can forecast a component’s EOL (end of life) using advanced lifecycle algorithms. With this information, OEMs can make better component selection decisions. Part obsolescence is an ever-present risk to medical device companies. Even parts have to die someday — bless their hearts. Managing part data in-house makes it difficult to plan for obsolescence issues, as forecasts are often based on data that is inaccurate or incomplete. Being caught unaware on a part going EOL can be catastrophic, causing costs to skyrocket and shipment delays. Additionally, faulty manual risk management processes caused by a bad part can lead to several medical device nightmare scenarios. ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 7 arenasolutions.com “Imagine you have a device that you’re expecting to last for ten years — it’s working well in the market, its components are readily available, and all of a sudden one part goes obsolete. Because of one component, your entire product is now at risk,” said Martin. “In an absolute worst case, your company might need to spend millions of dollars to redesign because of one component. Our software and tools aim to mitigate and avoid this type of risk.” By subscribing to an electronic component database and proactively assessing components with complete data knowledge, the service ‘cleanses’ components and provides visibility into their potential risk. Another issue medical device companies face is a growing plague of counterfeit parts, which if included in the design, can sabotage a device. No company wants to hear that its medical device failed during the course of performing surgery or that its medical scanner failed to detect cancer. To battle counterfeit risks, some database providers have developed algorithms — similar to the formulas devised to forecast EOL components — that examine how long a suspect part has been in the market. The system can also detect whether any counterfeit reports have been made on the component in the past, and verify how many distributors still carry inventory on this product. “Usually counterfeiters will go after parts that are on the gray market — parts no longer being carried by authorized distributors,” explained Martin. “Counterfeiters know companies are in a panic to get a hold of these parts. Yes, there are tests and measurements and methods in the market today, but you are not going to be able to test every single component, so there is always a risk.” When the electronic component database is integrated into a PLM system to manage the BOM and associated engineering change orders, medical device engineers have the ability to validate and assess all parts with cross references, lifecycle, parametric, obsolescence forecasts, regulation compliance and inventory data. “From a medical device perspective — in the case of having components and products you can trust — we are literally talking about saving lives here,” Martin said. Extending Your PLM Solution For medical device companies, a highly integrated, robust and complete design system is needed to address hurdles, such as obsolescence, single- sourced components, regulation compliance, and market availability of electronic components. Today, holistic quality systems needs to be more whole than ever before. How do you typically manage risk indentication, analysis, and mitigation? Documents on a shared network (Word, Excel, SharePoint, etc.) Documents under document control (EDCM, QMS, etc.) Commercial software product (IBM Rational Doors/Requisite Pro, Seapine’s TestTrack RM, etc.) Other 53% 12% 34% 1% What types of information do you need better visibility into during product development? 43% 38% 35% 34% 30% 24% 23% 20% 19% 3% Risk controls User needs Project status Related issues Gap analysis Related documents Impact analysis Trace structure Related requirments Other ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 8 arenasolutions.com Laurence Sampson, chief operating officer of Swan Valley Medical, can attest to the value of a PLM solution that embeds quality and also supports all future integrations and add-ons. “All the systems that we have had in the past — CAPA systems, Non-conforming Medical Report (NCMRs), complaint logs — had been paper systems,” said Sampson. “The interlinking of the different systems had been difficult to follow and understand.” Sampson relies upon Arena BOMControl and a suite of complementary solutions to meet his product design goals (see sidebar) “Each one of these different processes (Arena BOMControl, Arena Quality, Arena Projects, Document Control) can be linked together, so that when you get an audit you have a tightly integrated cross linked evidence chain for whatever problem you’re dealing with,” said Sampson. Carl Dupper, director of technical operations at Yukon Medical, agrees with Sampson that Arena Quality, which is linked to Arena PLM with integrated corrective action preventive action (CAPA) capabilities, provides a superior industry-wide approach to managing quality compared to using disparate systems. “The big win with Arena is the visibility of knowing where things are along in the design development and commercialization process and who is involved,” said Dupper. In addition to Arena’s suite of complementary PLM design management solutions, BOMControl integrates with component databases, such as Silicon Expert and Octopart, and external systems, including ERP, MCAD, and OrCAD, to fortify a truly end-to-end design environment. According to Manny Marcano, president and CEO of EMA, the integration between OrCAD and Arena provides a number of special benefits for medical device companies using both systems; for example, components from an OEM’s PLM system are available directly within the OrCAD design environment making search, selection, and placement very simple. Parts listed as obsolete or compliance risks in the PLM environment can be easily identified and swapped out in an OrCAD design. Reduce the total cost of quality Reduce non- conformances in manufacturing Improve customer experience Better manage operational risks Ensure compliance Top Quality Management Objectives To p Q ua lit y M an ag em en t O bj ec tiv e Percentage of Respondents Color by Industry Aerospace and Defense Automotive Electronics Industrial Equipment Man. Source: LNS Research Medical Devices 0 0.38 0.49 0.46 0.28 0.24 0.23 0.27 0.28 0.23 0.35 0.15 0.13 0.17 0.23 0.33 0.10 0.10 0.11 0.21 0.08 0.08 0.10 0.02 0.03 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 0.45 ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 9 arenasolutions.com “If business and parts information live in two different systems, you’ve got an engineer jumping back and forth between systems trying to figure out if they can use this part — and that usually leads to a huge opportunity for error,” said Marcano. Because of this integration, all parts added to a medical product design are assured to be approved and preferred components. With a complete design containing accurate component information, OrCAD users can create zero touch BOMs because all required component information comes directly from their enterprise PLM system. “This integration helps companies, especially medical device OEMs, consolidate the number of data sources they need to reference when they’re working on a design,” said Marcano. “We often hear of eCAD/mCAD co-designs but I suggest, you’ve never hear of eCAD/PLM co-design. And medical device companies today can benefit from this integration in several ways: quicker time to market, better efficiency, and tamping down risk. For medical device engineers, an eCAD/PLM co-design is a game changer.” Conclusion Many executives in the medical device industry — from the founders of startups to the heads of billion dollar public companies — have long felt overly burdened by what they consider unduly complex approval processes. Frustrated executives bemoan how these directives impede innovation and delay the availability of better health care. Impediments to medical device development cycles can, axiomatically, cost lives. Even the FDA recognizes the validity of the criticism, announcing last year a new Medical Device Innovation Consortium (MDIC) that will be charged with simplifying the process of designing and testing new technologies. Against the backdrop of health care reform and a controversial medical device tax, modern medical technology companies are focusing more than ever on the power of complete design solutions that deliver cheaper, faster, more efficient patient care. A PLM solution that supports interoperability among complementary solutions coupled with an extensible architecture to support integrations with current and future systems is now possible. This new and improved embedded holistic environment is an important key to ensure medical device makers succeed by reducing risk, improving quality and accelerating time to market. And that’s why three of the top five medical device companies rely on Arena. Bibliography: 1) http://aberdeen.com 2) International Journal of Management 3) http://aberdeen.com 4) http://www.mckinsey.com 5) Quality Digest ©2015 Arena Solutions, Inc. Arena and Arena Solutions are trademarks of Arena Solutions, Inc., Reg. U.S. Pat. & Tm. Off. All rights reserved. Other product and company names are the property of their respective holders. 10 arenasolutions.com 2013.06.27.cleantech.wp About Arena Arena pioneered cloud PLM applications. The company’s products enable engineering, manufacturing teams and their extended supply chains to speed prototyping, reduce scrap, lower cost and shrink time to market. Arena cloud PLM applications simplify bill of materials and change management for companies of all sizes, and offers the right balance of flexibility and control at every point in the product lifecycle—from prototype to production. Based in Foster City, Calif., Arena has been ranked as a Top 10 PLM solution and also holds a spot on the San Francisco Business Times’ Best Places to Work List for 2013. Contact Arena Solutions Foster City, CA 94404 P. 650.513.3500 F. 650.513.3511 Cloud. Connected. Content. Makes Making Easier. Author John Papageorge, the author of “Warning: Everything You Know About Medical Design is Wrong,” has worked with some of the biggest names in technology, including Oracle, IBM, Hewlett Packard, Cisco and Silicon Valley Bank, to analyze and communicate emerging business and technology trends.