The Importance of Lot Management

Introduction

In the pharmaceutical industry, strict lot management based on GMP (Good Manufacturing Practice) is required. Since it directly relates to the efficacy and safety of pharmaceuticals, detailed lot records are maintained throughout all processes, from raw material acceptance inspection through manufacturing, quality testing, and release determination. This is a fundamental requirement mandated by regulatory authorities worldwide, including Japan’s Pharmaceutical and Medical Device Act (PMDL), the U.S. cGMP, and the EU GMP.

In manufacturing, “lot management” refers to a management method for identifying and tracking groups of products (lots) manufactured under the same conditions. While it may seem like simple administrative work at first glance, it is actually a crucial initiative that supports the foundation of manufacturing, serving multiple purposes including quality assurance, safety assurance, and production efficiency improvement.

For example, imagine a ramen shop that has been protecting its secret sauce recipe for 20 years. If this sauce becomes contaminated with microorganisms, the very survival of the restaurant would be at stake. However, with proper lot management, only the specific contaminated lot can be identified and discarded, and the cause of the problem can be determined. By clarifying whether the contamination source was a raw material from a specific supplier or an issue with the manufacturing environment on a particular day, both recurrence prevention and business continuity can be achieved.

Fundamentals of Lot Management

A lot (or batch) refers to a group of products produced continuously under the same manufacturing conditions using the same raw materials. The foundation of lot management is to assign a unique identification number (lot number or batch number) to each lot and make it traceable from manufacturing through shipping and even to usage status in the market.

For instance, in food manufacturing, seasonings blended in the same tank or confectionery products manufactured on the same line on the same day constitute one lot. In automotive parts manufacturing, parts made from the same material using the same mold form one lot. In pharmaceutical manufacturing, products continuously manufactured based on a single manufacturing order are managed as one batch.

In ISO 9001:2015, the quality management system standard established by the International Organization for Standardization (ISO), product identification and traceability are positioned as important requirements, and lot management is widely recognized as a means to achieve this.

Five Critical Values Provided by Lot Management

1. Rapid Response to Quality Issues

When a defect is discovered in a product, by identifying its lot number, all products manufactured under the same conditions can be identified. This enables accurate identification of the scope of the problem and makes it possible to recall only the necessary range. This protects consumer safety while preventing economic losses from excessive recalls.

In recent years, with the advancement of digital technology, real-time lot tracking has become possible, significantly reducing the time from problem discovery to response initiation. This represents extremely important progress from the perspective of consumer protection.

2. Ensuring Traceability

Traceability, which enables tracking of the flow from raw materials through manufacturing processes to shipping destinations, is an indispensable element in modern manufacturing. Through lot management, it becomes possible to accurately understand “when,” “where,” “what,” and “how” something was manufactured, enabling root cause analysis and clarification of responsibility when problems occur.

In the food industry, ensuring traceability is clearly required in international standards for food safety management systems such as ISO 22000 and FSSC 22000. Furthermore, entering the 2020s, pilot projects for distributed traceability systems using blockchain technology are progressing in countries around the world, and more transparent supply chain management is being realized.

3. Inventory Management Optimization

Lot-based inventory management makes it easier to thoroughly implement the First In, First Out (FIFO) principle. Especially for foods with expiration dates and chemical products that deteriorate over time, disposing waste can be minimized by shipping from the oldest lots in order.

Additionally, by introducing digital inventory management systems linked with lot management, inventory visualization progresses, and risks of excess inventory and stockouts can be reduced. From the perspective of the SDGs (Sustainable Development Goals), this is attracting attention as an important initiative to reduce food loss and waste of resources.

4. Manufacturing Process Improvement

By analyzing quality differences between lots, the stability and problems of manufacturing processes can be understood. For example, when the defect rate is high for a specific lot, hints for process improvement can be obtained by examining those manufacturing conditions in detail.

Recently, by combining IoT (Internet of Things) technology with big data analysis, efforts are progressing to statistically analyze quality data on a lot-by-lot basis and connect it to optimization of manufacturing conditions and predictive maintenance. This is becoming an important element toward the realization of Industry 4.0 and smart factories.

5. Regulatory Compliance

In many industrial sectors such as pharmaceuticals, food, and automotive parts, ensuring traceability including lot management is legally mandated. Establishing an appropriate lot management system is extremely important from a compliance perspective.

Examples of Major Regulations:

Industrial Sector	Main Regulations/Standards	Overview of Requirements
Pharmaceuticals	PMDL, EU GMP, FDA cGMP	Creation and storage of batch records, ensuring traceability
Food	Food Sanitation Act, Food Labeling Act, EU General Food Law	Display of lot numbers, ensuring traceability
Automotive	ISO/TS 16949 (now IATF 16949)	Parts traceability, non-conforming product management
Medical Devices	PMDL, EU MDR, FDA QSR	Lot management, post-market surveillance

Furthermore, with the revision of the Food Sanitation Act enforced in 2021, sanitation management in accordance with HACCP (Hazard Analysis and Critical Control Points) became mandatory in principle for all food business operators in Japan, further increasing the importance of lot management.

Key Points for Implementing Lot Management

When newly introducing a lot management system or improving an existing system, the following points need to be considered.

Setting Appropriate Lot Sizes: Lots that are too small lead to increased management costs, while lots that are too large expand the scope of impact when problems occur. It is important to set optimal lot sizes according to product characteristics and production volumes. A setting that balances manufacturing capacity, quality risk, and economic efficiency is required.

Selection of Identification Methods: Select identification methods suitable for product characteristics and processes, such as barcodes, QR codes, and RFID tags. In recent years, the adoption of two-dimensional codes (QR codes and data matrices) has been increasing, with the advantage of being able to store large amounts of information in limited space. In the pharmaceutical industry, serialization (identification at the individual item level) based on GS1 standards is also progressing.

Integration with Information Systems: Achieve unified information management by linking with Manufacturing Execution Systems (MES), Warehouse Management Systems (WMS), Quality Management Systems (QMS), and Enterprise Resource Planning (ERP) systems. Cloud-based systems and API integration have made data sharing between different systems easier.

Conducting Education and Training: Education and training are essential to help field workers understand the importance of lot management and promote reliable execution. In particular, since omissions or errors in recording lot numbers pose serious risks that compromise traceability, regular education and verification are necessary.

Setting Record Retention Periods: Appropriate record retention periods need to be set according to product types and regulations. For pharmaceuticals, retention is typically required during the period of marketing authorization or for a certain period after manufacturing (usually 5 years or more), while for food, it is generally the expiration date plus approximately one year.

Promoting Digitalization: Transitioning from paper-based records to digital records enables improved data searchability, reduction of human errors, and real-time information sharing. However, for electronic records, compliance with regulatory requirements for electronic records and electronic signatures such as FDA 21 CFR Part 11 and EU Annex 11 is necessary.

Conclusion

Lot management is a fundamental and important initiative for ensuring product quality and safety. Establishing an appropriate lot management system not only fulfills the social responsibility of consumer protection but also leads to management risk reduction and operational efficiency improvement for companies.

With the advancement of digital technology making more sophisticated and efficient lot management possible, manufacturing companies are now required to build lot management systems appropriate to their characteristics and continuously improve them. By utilizing cutting-edge technologies such as IoT, AI, and blockchain, real-time traceability and quality prediction using big data, which were previously difficult, are becoming increasingly feasible.

Furthermore, as ensuring traceability throughout the supply chain is emphasized, coordination across industries is progressing, including information sharing with business partners and adoption of standardized identification codes. Reviewing lot management, which is fundamental to manufacturing sites, and incorporating the latest technologies and regulatory trends is the first step toward strengthening manufacturing competitiveness.

Moreover, from the perspective of ESG (Environmental, Social, and Governance) management, transparent lot management and traceability are positioned as important elements that enhance a company’s social credibility. Ensuring product safety and establishing a system that can respond quickly when problems occur forms the foundation for sustainable business operations.