Manufacturing Management and Technology Transfer in China

By Wayne Schnarr

In this week’s post, Wayne discusses life after his career transition from research chemistry to manufacturing management, and takes us back to 1984 when he visited China at the end of the cultural revolution.

I was the manufacturing manager at the Canada Packers biologics facility for 2 ½ years before moving to Connaught Laboratories, also in manufacturing management. My time at Connaught Laboratories is something I will discuss in my future posts but one striking difference between the two facilities was in the raw materials used; Canada Packers used animal tissue while Connaught Laboratories used human plasma.

One of my first orientation activities at Canada Packers in 1978 was a walk through the entire cattle and hog kill floors at the Toronto facility. The hog kill floor is where they make bologna and hot dogs and I got to watch this process while there. This part of the orientation wasn’t a mandatory activity and neither was it for the faint-hearted. I remember some who had volunteered to go and couldn’t make it all the way through. What was important for me to know for my job was how the various raw materials were collected, and how that might impact their use as raw materials for biologics isolation.

Since most readers have no background in this area, I’m going to outline some details on one product, heparin. Heparin is a highly-sulphated sugar polymer used as an anticoagulant (blood thinner). Today, global sales of heparin products are around US$8 billion and growing, with most of the sales being low molecular weight heparins made from natural heparin. It’s a safe product because it has a relatively short half-life and can be neutralized with protamine sulphate (the original source was salmon sperm). The raw material for heparin is the mucosal lining of the hog intestine, although beef lungs have been used by other companies. The hog intestine is removed, the undigested food and feces are flushed out and the relatively clean intestine is then passed between a pair of rollers. The mucous is squeezed out, mixed with a preservative and collected in 250-gallon plastic totes or 5,000-gallon trailers. The mucosa must be warmed in the winter so it does not freeze and, in the summer, it must be transported quickly so it does not spoil. The cleaned hog intestines can be collected for use as sausage casings.

I don’t remember the manufacturing details but we would process up to 2,000 gallons of hog mucosa in one batch. The main Ontario abattoirs would each process up to 5,000 hogs daily, whereas several U.S. facilities would handle more than 15,000 hogs daily. The Olymel plant in Red Deer, AB and the Maple Leaf Foods plant in Brandon, MB had weekly hog slaughter capacities of about 90,000 in 2009. Several years after I left Canada Packers, they stopped making heparin because they could not compete with the U.S. economies of scale or the growing Chinese production.

Manufacturing management is not easy, whether it is complex batch processing or an assembly line. I adopted the MBWA strategy – Management By Walking Around. No matter how prepared I tried to be, there were several things that caused me anxiety on a regular basis such as:

  • Standard costs and profits – labour, overhead, raw materials, properly assessing which products contribute the most to profitability in a multi-product facility and, at the end of the month, I was responsible for filling the product orders with quality material that could be sold at a profit
  • Biologic raw materials – how do you properly sample and assess 50 lb. frozen blocks of hog pancreas or a 5,000-gallon tanker of hog mucosa?
  • SOPs and batch records – it is impossible to properly look at variances in yield and production costs if the operating procedures and batch records do not properly describe the manufacturing procedure and record the key production variables
  • Human resources – another area I was not good at

However, successfully bringing new products and processes into the facility was immensely satisfying. Some of the products we brought in were:

  • Natural taurine – while this small molecule can be made very cheaply from petrochemicals, we isolated it from beef bile using a 1,000 litre ion-exchange column (steel with a polymer lining) for a company which wanted a natural-source product
  • Hyaluronic acid – isolated from chicken combs, the key scale-up concern was burning out motors due to the viscosity of even dilute solutions
  • Bovine serum albumin (BSA) – a product used extensively in diagnostic kits, an inexpensive raw material (beef blood), market size which could justify capital expenditures but also a product with many nuances (look at the list of BSA products in the Sigma-Aldrich catalogue)

While we had numerous successes, one particular venture that was not successful was the technology transfer of a new CDCA procedure to a Chinese manufacturing facility. In 1984, we were approached through the Canadian government by a pharmaceutical factory in Xian that had access to large volumes of hog bile and an empty factory. Soon after this, I went to China to bring samples of concentrated hog bile back to Canada (getting those through customs was interesting), but the CDCA concentration of the hog bile was lower than in the North American raw material, and the yield was not high enough to be commercially viable. This difference in concentration and yield may have been due to the different breed of pigs and/or their diet. The lack of infrastructure in China in 1984 to move tankers of chemicals needed for the production process in my opinion, may have also contributed to their low concentration and yield.

While my reasons for being in China were work-related, there was quite a bit going on in and around the region during this period that was hard to ignore. In March of that year, China had just emerged from the cultural revolution which marked the beginning of its industrialization. Just a month later, Ronald Reagan, the U.S. president at the time, was going to visit Xian as part of a state visit. This required the presence of more than the usual number of U.S. military and government personnel to prepare for his visit.  Breakfast was always an interesting time as you got to watch the icy stares, bordering on hatred, on the faces of the North Korean soldiers as the Americans walked in. For our last two nights in China, we stayed at the Xiangshan Hotel in the Western Hills of Beijing. The hotel had been open for just under two years and had been designed by the iconic Chinese-American architect I.M. Pei.

However, work was not the only thing that has taken me to China. In September 2009, I went back to visit my son who was teaching in Shanghai. I not only got to see my son on this trip, but I got to compare the China I left in 1984, to the one I found when I went back in 2009. We had a variety of guides during my most recent trip, ranging from one recent university graduate who spoke only from the government guide, to a farmer’s son who gave us insight into daily life, to an experienced guide with whom we could have meaningful conversations. There were noticeable differences on this second trip. For instance, in 1984, when the unearthing of the terracotta warriors had just started, the area was covered with a simple building (airplane hangar) and photos were strictly prohibited. However, when I went back in 2009 I found that this area was now well-developed and considered an amazing tourist attraction. Additionally, in 1984, the moat surrounding the wall around the old city of Xian was being excavated (mostly by hand) but in 2009, the wall was completely rebuilt and you could walk or cycle the entire perimeter on top of the wall. Although a lot has changed in China and even more has continued to change in manufacturing management, the one thing that remains the same, even after having seen how they’re made, is my love for bologna and hot dogs.

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