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In this article about Pharma supplier selection we explore the controls needed to both approve Pharma suppliers and to control the purchasing of materials from them.

GMP requirements

In EU GMP Chapter 2, on Personnel, it states that the Head of Production and Quality Control are responsible for the approval of suppliers as a shared duty.  In Chapter 5, on Production, there are some additional requirements concerning starting materials.  GMP states that “starting materials should only be purchased from approved suppliers”.  At this point it does not state much more about how you can approve suppliers, but it does go on to say that suppliers should be named in relevant specifications and that you should, where possible, purchase directly from the producer, rather than using brokers where the supply chain can become more complicated and open to problems.

ISO 9001 requirements

ISO 9001, the international standard for Quality Management Systems, also has some good ideas when it comes to suppliers that are not directly mentioned in GMP.  It states that “the type and extent of control applied to the supplier and the purchased product shall be dependent upon the effect of the purchased product on subsequent product realisation or the final product”.  In other words the controls imposed on a supplier can vary based on impact to product quality.  In a pharmaceutical context then it is therefore likely that you will audit a supplier of an Active Ingredient whereas you may not audit (for example) the suppliers of pens, paper and stationery.

In addition, it states that “the organisation shall evaluate and select suppliers based on their ability to supply product in accordance with the organisation’s requirements”.  One of these requirements may well be price, but you are likely to also have other requirements such as what quality to you want the materials made to (grade or specification), whether you want it to be made to a certain standard (such as Active Pharmaceutical Ingredient GMP), whether they can supply you by a certain date and even if they can supply you with the quantity that you require.

It also goes on to say that the “criteria for selection, evaluation and re-evaluation shall be established”.

In other words, you need to have some form of system in place to approve suppliers – and this is what we will look at next.

Supplier Approval process

Here is an example of the process that most organisations go through when it comes to selecting a new supplier of (in this case) an excipient i.e. any chemical in the finished product that it not the Active Ingredient.

Stage 1 – Assess potential options.  In this stage suppliers that may be able to supply you are looked into.  High level information on each supplier is obtained to establish if in theory they may be able to meet your needs.

Stage 2 – Gather further information.  The short listed suppliers may be sent a questionnaire to gain further information on the organisation.  In addition, they may be asked to send samples of the material for you to test and evaluate.

Stage 3 – Audit.  Where it is deemed appropriate the location of manufacture is audited.  The auditor should be suitably trained and competent, with specialist experts taken as part of a team if necessary.  You should not only consider if the organisation can make product of the right quality but also if they have the ability to supply you as well (i.e. have they got the capacity to cope with your orders).

Stage 4 – Provisional approval.  Here the supplier is approved provisionally.  When they supply you then samples are taken from each container with full analysis occurring.  This may continue until (say) you have repeated this for at least 3 different batches of materials.  You need to not only be satisfied with the Quality Control test results, but also the performance of the material when used in manufacture and well as on time delivery, price and customer service levels.

Stage 5 – Full approval.  If you are satisfied with their performance so far they may me moved to full approval status.  This may permit you to perform reduced testing of the materials or this may need to wait longer until you have further confidence.  A date to perform an on-going surveillance audit should also be established – this is typically every 2 or 3 years depending on the risk.

At any time, a supplier can be moved back to provisional approval status or even rejected as a supplier if you have any concerns.

On-going approval/management

Don’t forget that after a supplier has been approved then their on-going performance still needs to be monitored.  This should also feature in annual Product Quality Review reports.

On-going monitoring is a team effort and should consider both GMP and non-GMP/ business related issues:


  • Test results and trends of results
  • Out-of-specification results
  • Failures, problems, rejects, returns and incidents
  • Condition of incoming materials
  • Quality standards worked to/accredited to
  • The results of any audits or inspections
  • Comparison between results and those on any certificates of analysis

Non-GMP/ Business

  • On-time-delivery
  • Speed of responses to enquiries
  • Lead-time for orders
  • The suppliers ethical and/or environmental status
  • General customer service levels
  • Price may also be a factor, but this should not be the only factor!

Auditing Suppliers

If you do audit suppliers, it is important that you audit them against the correct standard.  There are a range of standards to consider depending on the type of supplier that you are auditing. These are covered in some detail in this article.

As you will see from this article there are a large number of supplier standards, so supplier auditing is a complicated affair.  It is therefore important that auditors are well trained as auditors and have an appreciation of these supplier standards as well as how they are used in practice.  Also remember that auditors are ambassadors of an organisation, so their professional performance reflects on the organisation that they are representing (see our IRCA registered course).

One problem that is often encountered by those involved in the supplier approval process is that you want to audit suppliers – but some do not want you to audit them.  This is often due to the amount of money that you spend with them being small when compared to their other customers.  There is not much that you can do in this situation and there is little legal framework to help you.   The only real legal help that you have is that a pharmaceutical manufacturing site must ensure that its APIs have been made to API GMP.  This means that generally you do get to audit API suppliers or you can rely on audits by Regulatory Agencies or 3rd parties.   When it comes to all other suppliers it comes down to the relationship that you have with them and by pressing the importance of an audit to you with regards to help ensuring the quality of your medicines.  Also remember that an audited and approved supplier may make them more cost effective than their competitors – as you may be able to perform less QC testing of materials purchased from them.

Purchasing and management

Once you have approved a supplier you are likely to start purchasing materials from them.  EU GMP has a very brief mention of purchasing in Chapter 5.  Here it simply states that “the purchase of starting materials is an important operation which should involve staff who have a particular and thorough knowledge of the suppliers”.  There is a very important point within this requirement as individuals involved in purchasing must have an appreciation of the impact of supplier’s material with the quality of the finished medicinal product.  Furthermore, selecting suppliers based on cost alone may not either be cost effective or meet GMP requirements.  As a site must have approved suppliers then it is normal practice to produce some form of approved supplier list, and people purchasing materials must only select suppliers from this list.

If a supplier has been audited and you have historical data on their performance, then you may be able to perform reduced testing of their incoming materials.  Changing a supplier will often mean that this process must start all over again with an audit needing to be performed (of the new supplier) coupled will full testing for a period of time.  This costs money – and may not mean that an organisation has actually saved any money by selecting a cheaper supplier as opposed to an existing approved supplier.

Bearing in mind that the activity of purchasing is often performed by individuals from the Logistics, Financial or Purchasing Departments then their training and ability to change or not change suppliers must be carefully controlled.

I hope this article is useful – your comments will be welcomed.

This article is based on an extract from Module 3 of our Pharma and QP QMS courses.

Our 5-day GMP Pharmaceutical GMP Auditor/Lead Auditor Training Course also reviews this topic in some detail.

Annex 1 has finally arrived, 25th Aug 2022 saw the publication of Annex 1. Normally, updates to GMP chapters and Annexes have a 6-month lead time for implementation. In the case of the new Annex 1, the lead time is 12 months, except for clause 8.123 relating to lyophilization which has 24 months lead time.

Annex 1 was first issued in 1971 as the only annex in the first ever UK guide to Good Manufacturing Practice. Since then, there have been several updates but not full revisions. In 2012 there was a proposal to revise Annex 1 with a re-proposal in 2014 by the UK’s MHRA. At the time, a full rewrite was considered unlikely and instead the intention was to provide a document that would confirm regulatory expectation and as such, not place any new requirements or costs on the pharmaceutical industry.

While this principle, is still upheld, it was clear from the first draft for public comment of December 2017, that a rewrite was being undertaken. The first draft created around 6200 comments coming from regulatory organizations, such as the pharmaceutical cooperation scheme, regulatory bodies outside of the EU, support organizations such as the Parenteral Drug Association, the Parenteral and Healthcare Sciences Society, the Pharmaceutical Microbiology Interest group as well as representatives from the manufacturers within the pharmaceutical industry to name just a few. Rarely do updates require a second public consultation but in the case of the annex 1 update a second draft was issued in March 2020 although this was a more targeted review in terms of the sections and clauses that comment was being sought for.

About the author

Andy Martin

Andy Martin

Andy started working in the Pharmaceutical industry in 1985 as a lab technician for Smith & Nephew.  Following this he had a number of roles culminating when he took over as QA Microbiology Manager.   In 2003 he moved into Pharmaceutical Training and then in 2007 he moved back into Microbiology when he took up the position of Microbiology Manager for Catalent Pharma Solutions.  Since 2012 he has operated as a consultant specialising in Microbiology and Quality Systems.

Training courses on Annex 1

There are a number of half-day workshops organised to take you through the changes in more detail and to look at how they relate to your organisation.

Our 2-day course is updated for Annex 1 changes

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