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Quality Agreements: The Devil is in the Details!

Ask the average person in our industry what is the difference between a Quality Technical Agreement (QTA) and a Master Service Agreement (MSA), and you’re likely to get a blank stare. Even experienced professionals can be hard-pressed to describe the distinction precisely. The short answer is simple: the MSA defines the fees and services agreement between two (or more) parties, and the QTA defines who is responsible for what in the actual execution of those services, particularly as related to GMP. Both are legally binding.

While some QTAs are literally incorporated into the MSA, it is more common to see them as separate, yet inextricably related, documents. QTAs should not describe fees, but they may describe who has the financial responsibility for various quality-related events, such as a batch failure, on an “if this, then that” basis. Dollar amounts should never enter into a QTA; that belongs in the MSA. A good QTA will cover GMP issues, making sure responsibility for each GMP requirement is clearly assigned, and in some instances, how that requirement will be executed (e.g., reporting OOS results by phone, followed by an email).

The most common issue with QTAs is they tend to be weighted in favor of the party writing them. This, to a certain extent, is natural, but a QTA should not be allowed to be so biased as to disadvantage the other party. The greatest obstacles to producing a truly balanced document are time windows and definitions.

For instance, paraphrased from an actual QTA clause: the CMO writing the QTA states that the CLIENT will have 30 calendar days (just over four weeks) to review and approve a new MBR. The client is “allowed” to send one list of questions/comments back to the CMO during that time period, but the CMO has 30 working days (just over six weeks) to respond to the questions and comments. The kicker here is the next part: if it is neither signed nor contested by the client at the end of that 30-day period, the MBR will be considered approved. This puts the client at a huge disadvantage – if there are any issues with the MBR there is no way to hold up their end of the agreement that works out fairly for them.

Here’s a potential solution: both parties have the same amount of time, either 30 calendar days or 30 working days, the clock restarts when the list is submitted, there is a limit of two lists, and there is no default approval of the MBR without the appropriate signatures from the client.

The second most common problem is vague, imprecise, or missing definitions in the Definitions section of terms that appear in the text of the QTA. Example: Deviation – “a failure to meet process criteria or to follow approved procedures.” The terms “Major Deviation” and “Minor Deviation” were not defined here or anywhere else in the QTA, but were used later in the text, requiring the undefined Major Deviations to be reported to the client within five working days, and with no requirement to report the undefined Minor Deviations to the client at all. These inexplicit definitions can create the following problems:

  • The client had no chance to agree or disagree with the definitions of “Major” and “Minor” deviations – this puts them at a disadvantage.
  • Without a clear definition of Major and Minor deviations, there is potential for disaster, ranging from recalls to litigation, and all points in between.
  • The five-working-day reporting window also is a bit long– if a deviation does not occur on a Monday, it could be seven days –including the weekend – before the deviation is reported.

Perhaps the most difficult part of a QTA to get right is the Responsibilities Matrix. This is a table of three or more columns; the left-most column very briefly summarizes each clause, and the remaining columns are for the parties involved in the QTA. An “X” in a given party’s cell indicates responsibility for what that clause describes. (Both parties can be responsible for something, such as notifying each other about product complaints.)

For some reason, this seemingly straightforward section is most prone to errors, either in the summary of a clause, or the assignment of responsibility. It is also the most tedious and difficult to review for accuracy. Furthermore, it is the most highly used; because of the concise nature of the clause summaries and the simplicity of an “X” defining who is responsible, it is the “go to” source of information for responsibility-related questions.

A relatively easy way to improve the accuracy of the matrix is to include hyperlinks to the full clause being summarized. This allows the reviewer to confirm agreement between the matrix and the actual language in the contract, and saves a lot of flipping back and forth and scrolling when reviewing the document for accuracy. Hyperlinks should also reduce issues with re-numbered clauses not being updated in the matrix.

A well-written QTA saves a lot of time, money, and frustration. It should eliminate the “I thought you were taking care of that” syndrome. Even though the recent FDA guidance Contract Manufacturing Arrangements for Drugs: Quality Agreements only addresses commercial products, QTAs can and should be used in all contractual settings, not just those for drugs that have been approved.

Blog article by: Arvilla Trag