A number of pharmaceutical quality characteristics are destructive or too costly to inspect. However, most quality improvement tools developed in the pharmaceutical research community typically assume that quality characteristics are nondestructive. This paper proposes a new design system for quality improvement by incorporating the concept of surrogate variables with the concepts of robust design (RD) and tolerance design (TD). The proposed robust-tolerance design paradigm determines the optimal factor setting and specification limits simultaneously, thereby improving quality of pharmaceutical products. In addition, the proposed methodology can provide the optimal tolerance as a mathematical closed-form solution. Finally, a numerical example and its associated sensitivity analysis for a pharmaceutical case are conducted for verification purposes. Based on the numerical example results, the proposed approach could provide robust factor settings with significant tradeoffs between quality and cost.