BearingPoint Study Shows Life Sciences Companies Struggle with Product and Process Engineering Changes.

40 Percent of Companies' Non-Compliance Issues Tied to Insufficient Engineering Change Practices

MCLEAN, Va. -- Effectively managing product and process engineering change is becoming increasingly important to life sciences companies worldwide, whether the change is to a product's packaging, ingredients or design. Yet, according to a recent study with AMR Research Inc., more than a third of companies surveyed said they still have no formal change process in place.

The study, "Best Practices and Thought Leadership in Life Sciences Engineering Change Management," surveyed 120 life sciences companies, including pharmaceutical, biotechnology and medical device and contract manufacturers around the world, and asked about how their organizations deal with engineering changes.

Companies that take an integrated approach to managing change can innovate more quickly, promote compliance with global regulations and support a profitable, enterprise-wide response to customer demand. Nevertheless, the study found:

* only 55 percent of inline life sciences product enhancements launched in 2007 were rated a success;

* a staggering 40 percent of regulatory issues, including warning letters, regulatory inspection observations or compliance observations were attributed to engineering changes;

* significant gaps exist in performance, financial planning, regulatory assessment and documentation management processes between the life sciences companies and their third-party manufacturers.

The study suggests that life sciences companies are shifting to an enterprise-wide approach to managing product and process engineering change to cope with the increasing rates of change in today's business environment. By 2011, 46 percent of the companies surveyed expect to manage change globally, but manage the execution processes centrally.

The study also shows that even though life sciences companies recognize the value in planning and are prepared to spend more to better manage product manufacturing change over the coming years - 38 percent growth by 2011 - significant barriers to success remain. Fifty percent of the companies surveyed with change management practices said their teams meet just once a quarter or less frequently, and these teams do not always utilize an appropriate set of metrics to track changes and drive process improvements.

"In so many organizations today, no single group has the authority or resources to respond to changing market demands. Change is tackled on a project-by-project basis - a resource-intensive and impractical approach," said Ellen Reilly, a managing director in BearingPoint's Life Sciences practice. "To effectively deal with change and increasingly complex compliance and regulatory pressures, life sciences companies need to be more agile and have an organized, enterprise-wide response to change. Effective management of product- and process-engineering change can lead to reduced cycle times, swifter responses to changing market conditions and increased rates of product innovation."

BearingPoint has developed a solution to help life sciences companies effectively manage engineering changes. BearingPoint's Agile Manufacturing Solution helps life sciences companies with the strategy and execution of business processes, tools and training needed to respond quickly to customer needs and market changes while still controlling costs, quality and compliance

BearingPoint will host a webinar featuring AMR Research on Thursday, Oct. 30 at 11:00 a.m. E.T. to discuss the full survey results. To register, visit www.bearingpoint.com/ecmwebcast and click the "Register Here" button.

For more information on BearingPoint's Agile Manufacturing Solution and other solutions for life sciences companies, visit www.bearingpoint.com/lifesciences.

About BearingPoint, Inc.

BearingPoint, Inc. (NYSE: BE) is one of the world's largest providers of management and technology consulting services to Global 2000 companies and government organizations in more than 60 countries worldwide. Based in McLean, Va., the firm has approximately 16,000 employees focusing on the Public Services, Commercial Services and Financial Services industries. BearingPoint professionals have built a reputation for knowing what it takes to help clients achieve their goals, and working closely with them to get the job done. Our service offerings are designed to help our clients generate revenue, increase cost-effectiveness, manage regulatory compliance, integrate information and transition to "next-generation" technology. For more information, visit the Company's Web site at www.BearingPoint.com.

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