Morning Session : Growth and Demand for Analytical Services

The presentation will highlight key outcomes of a market research survey of both public and private sector demands, use and value of analysis (ie chemical and biochemical testing and screening). This survey has been conducted by LGC on behalf of the UK Analytical Partnership and forms one of a series of surveys spanning the last 4 years. It probes the prime drivers for deploying or purchasing analytical services, either as client or sponsor of stakeholders such as industry, government departments or the research base. With the ever changing shape of the analytical market and supply base, it also seeks to establish trends and criteria for different means to access required services. For example, laboratories previously owned and managed by government or club-based agreements now operate commercially, this in parallel with the consideration of outsourcing and joint-venturing - what criteria are set to value-test these arrangements? A re-consideration of the overall expenditure on analytical services inevitably accompanies such reviews and the survey tracks these trends, and rationale to support such trends, across a number of sectors. With the increased emphasis on networking and collaboration as a source of added value innovation, the survey seeks to draw on experiences to date on engagement in and success of such ventures. Finally it aims to take a forward look on key issues surrounding analysis and any perceived impact on its forward market place, both from a UK and relative global perspective.

Introduction

This paper provides an overview of qualitative research funded by DTI's UK Analytical Partnership (www.ukap.org) to pool information on markets, regulations, and measurement concerns from over 100 experts and opinion formers in the food, environment, pharmaceutical, healthcare, and chemical sectors. The combined sector studies provide a valuable insight into the way regulation is developed by Government, interactions with UK organisations, and factors driving the demand for analytical services.

Regulatory Developments

Analytical challenges related to chemical, environment, and food regulation are expected to increase in the future as more precautionary measures and detection limit goals are set in European legislation. This is set against a backcloth of increasing regulation and voluntary industry actions to stem rising public expectations about food safety and consumer and environmental exposure to chemicals and drugs, driven in part by improving detection capabilities. A new chemical registration system (REACH) has been proposed in Europe to obtain more safety data on the 30,000 chemicals currently marketed. Manufacturers will have to provide evidence of product safety and where necessary conduct additional testing to fill data gaps. The demand for contract research and testing is expected to grow as assessments of chemical toxicity and exposure are envisaged. This means that the analytical sector will face increasing demands in terms of its ability to respond rapidly to high profile issues (e.g. public scares and regulatory claims) and direct outsourcing requirements.

Analytical Challenge

Surveillance monitoring will likely increase in the future and analytical data may be subjected to more scrutiny as products are defended and considered for replacement because of health and safety concerns. Product litigation as seen in the US could become more prominent in the UK with increased surveillance monitoring and random inspections by regulatory authorities to check compliance. In this respect verification services to confirm industry data and analyses will be important. Residue analysis for persistent organic pollutants and banned substances in formulated products will likely increase and with it problems of increased measurement efficiency (and certainty) at lower doses and maximum residue levels.

Analytical Outsourcing

Outsourcing of services is already more common but it is unclear if buyers of analytical services are sufficiently knowledgeable to make the right decisions when choosing service providers, and how they judge laboratory performance (obviously a concern given the developments discussed above). Interestingly, comparisons of laboratory performance have thrown up concerns relating to the competence of some laboratories to produce reliable results, notably in contaminated land analysis and contaminants in food. In some areas (drinking water) the level of analytical service is probably the best in the country. In others, there has been a gradual erosion of the importance placed on valid analysis, and repeated cutbacks and cost-cutting have resulted in low levels of regulatory monitoring by companies. The consistent application of measurement uncertainty is a key issue for food, chemical, and environmental sectors and there is evidence that the interpretation of results can be inconsistent across sectors and regulatory authorities. The demands of quality compliance, duplication of assessment procedures, and the cost associated with maintaining wide accreditation scopes is also a key concern.

The UKAP Good Regulation and Competitiveness Report for the Environmental Sector examined the influence of regulation and the associated analytical capability in the potable water, water quality and effluents, contaminated land, waste and air sub-sectors. While the consultation was limited, the views of the Environment Agency, industry, consultants, laboratories, UKAS and the Drinking Water Inspectorate were sought. Changes in the analytical requirements for compliance monitoring, mainly through the Agency's MCERTS scheme, and the business and analytical quality requirements of ISO 17025 are discussed.

In addition to sub-sector specific findings, a number of general conclusions regarding the environmental analysis sector are pertinent to this meeting. In particular, the general decline in skills and increasing competitiveness has had a negative effect on quality. A lack of structure in the sector both in respect of networking and consultation with the regulators has resulted in a lack of direction. The decline in the Standing Committee of Analysts and support for analytical committees has slowed progress in the development of fit for purpose methods and leaves the UK vulnerable to imposition of CEN methods.

In the Air sector, the full introduction of the Agency's MCERTS Scheme is expected to prove effective in improving the quality of analytical data. There are still chemical methods used in ambient air monitoring that are not covered by MCERTS and proficiency testing is almost non-existent, apart from the WASP scheme which is directed towards occupational hygiene. Potable water compliance monitoring is well regulated with good communication between the Regulator and laboratories. Opportunities in this sector arise largely from commercial competitiveness and the need for greater efficiency without a decline in quality.

In contrast, the Soil sector, and also to a large extent Waste, has suffered badly over recent years from a lack of clear requirements, technical guidance and regulation. Coupled with intense competition this has resulted in a decline in analytical quality and poor interlaboratory performance. The introduction of the Agency's MCERTS for soils analysis will hopefully make a difference, but opportunities must arise for the provision of efficient analytical services with measured performance. Likewise with Waste, Water Quality and Effluents, there is a need for clearly defined performance requirements and assessment of achieved performance, from which point, business opportunities in respect of technical and instrumental development, new methods and efficient processes and associated infrastructure support will become much clearer.

This paper will present the results of a study carried out for the United Kingdom Analytical Partnership (UKAP) on competitiveness in the food analysis sector.

It is presented in four parts:

1. An overview of the Food Sector in terms of size, groupings and trends.

2. An analysis of the Food Sector business environment which examines:

• Barriers to Entry - how easy is it to launch a new laboratory?
• Supplier Power - particularly instrumentation, test kit and chemical suppliers.
• Substitution Threats - alternatives to lab-based analysis.
• Buyer Power - Focusing on the effect of competitive tendering in the Government sector and the power of the retailers in the food industry.
• Competitors - looking at the main players from Central Government, Local Government, the Private Sector, Research Associations and Universities.

This analysis concentrates on the current analytical standing of the sector.

3. A summary of the critical success factors for the food laboratory. (This focuses on the internal environment - what skills, resources and systems do labs need to compete successfully?). It includes an analysis of the strengths, weaknesses, opportunities and threats associated with the sector. (SWOT).

4. Future trends.

This presentation will be illustrated with the experiences within the Public Analyst sector and will offer some recommendations to improve competitiveness of Food Laboratories.

Afternoon Session : Case Studies: Realising Business Opportunities

Historically instrument companies have developed high tech scientific instruments and offered these products to the market place without proving them for a particular application. Method development and market acceptance has been the task of the purchaser and the time cycle between procurement and effective utilisation of the asset has been open ended and unpredictable.

Today's busy environmental laboratories require a complete analytical solution to their requirements, which includes method development, regulatory compliance and validation.

The challenge for the analytical solutions provider is to offer a range of solutions to customer requirements across the global marketplace. This requires new thinking in instrument design, business processes and analysis of customer requirements.

This paper describes an insight into one approach that led to the provision of a number of analytical solutions on a worldwide basis.

The aim of this presentation is to clarify some of the areas where there is frequent misunderstanding between clients, contract research organisations (CROs) and the Competent Authority receiving regulatory data. The main focus will be on the set of data required for the notification of a new substance, within which there is a considerable quantity of analytical work. Physicochemical property data, mammalian and aquatic organism toxicity test results are all required for a notification.

In cases where a CRO is responsible for producing a package of notification tests on behalf of their client, it is reasonable to expect the client to provide them with certain information on the substance to be tested in order to ensure that the tests conducted are scientifically valid and the results correctly interpreted. The types of information that may be requested:

This presentation stresses the importance of the physico-chemical tests and analytical data in the overall notification scheme and how information from the client is used in preparation and review of the notification dossier.

It is concluded that CROs need to be confident enough in their understanding of the regulatory requirements to negotiate with clients before work starts, if necessary.

Negotiating contracts is of prime importance for environmental laboratories. It ensures that client and provider have the same understanding of what is being produced and it protects both parties from work outside specification. Actually, much work in environmental analytical laboratories is carried out without any contracts in place, often without even an order number. This can lead to real problems as the work progresses and is reported, and may cause disputes between lab and client that can only be resolved by resort to the law. Contracts should begin with clear and understandable statements about what is expected from the laboratory and what is being provided to the laboratory and may include such things as references to method statements, sampling procedures, scope of accreditation etc. Timescale for result and report production together with the type of report to be produced will form an important part of any contract. Pitfalls when these are omitted, or not agreed between parties, can include financial penalties, the requirement to repeat work, a loss of confidence by customers in the laboratory and adverse publicity. In many cases the financial value of analytical work in an environniental investigation may be quite small. The consequences of data production that is not fit for purpose may, however, be very large. Liabilities and insurance cover are a source of much debate and discussion in most contract negotiations. Although contract review is not part of negotiations it is an integral part of a good working relationship with any client and is a requirement of ISO 17025. The ability to learn for experience and improve the service provided is an important characteristic of a good laboratory.