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The supply chain is evolving rapidly to meet the shifting demands of an increasingly vast and complex pharmaceutical market.
More diverse treatment options, shorter product lifestyles, increased globalization, new methods for approving and monitoring medicines, and stricter environmental regulations have all created the need for higher efficiency, affordability, visibility, and security.
How Does the Pharma Supply Chain Work?
To ensure the pharma supply chain is future-ready and able to adapt to an ever-shifting market, the industry has focused on a few key areas:
New Technologies
With better access to emerging technologies and digital tools, the pharma supply chain has been able to increase efficiencies in both manufacturing and distribution. Big data, in particular, has emerged as a major boon. As of 2019, 90% of pharma supply chain data was generated in the previous two years alone.
As with many other U.S. industries, however, pharma as a whole is still learning how to best leverage this data to optimize decision-making processes, offer new products and services, and handle inefficiencies.
As the supply chain begins to shift from enterprise resource planning (ERP) software to the cloud, this data will be able to be shared more securely, reducing the risk of cybercrimes and facilitating communication across different companies and organizations.
Increased emphasis on patient outcomes — rather than brand — is also forcing pharma companies to find new, more effective ways of collaborating with tech and IT companies.
Ultimately, today’s latest technologies will allow for an increasingly complex range of pharma products and more efficient distribution to patients.
Environmental Focus
Over the past several years, consumers and governments alike have been demanding more sustainable, environmentally friendly supply-chain processes across industries of all kinds. Pharma is no exception.
In the U.S. and across the world, environmental regulations have become increasingly strict as concerns mount over pollution caused by both human and veterinary pharmaceutical products. Plastic and water waste, in particular, as well as carbon emissions, have come into sharp focus.
To address plastic waste, manufacturers are zeroing in on recyclable and reusable packaging materials, in addition to generally reducing the amount of packaging wherever possible. This can present a challenge for the pharma industry, as drugs must still be reliably protected from the elements and potential contamination.
Smart tracking systems are showing immense promise for reducing waste. With end-to-end insights into the supply chain, companies can closely analyze each stage of the chain, identifying areas for streamlining and improvement.
On the product side of things, new medicines, such as gene therapies and biologic drugs, are presenting new challenges. Because these medicines — both of which require cold shipping — are very sensitive to environmental changes, it’s crucial that environmental and climate shifts are tracked and monitored closely.
Increased Collaboration
As mentioned earlier, the pharma supply chain has become increasingly technology-driven. And this, in turn, is making collaboration easier and more efficient than ever.
For example, the shift from ERP software to the cloud allows any player in the supply chain to connect to a single shared system, regardless of the organization’s particular IT infrastructure. In this way, key data can be shared more quickly and affordably.
This has major implications for the future of the pharma supply chain as a whole, as all involved parties — from designers, manufacturers, and distributors to health care providers — become increasingly integrated.
By creating a fuller, more detailed picture on the process end to end, these parties will be able to plan more efficiently and accurately, helping to ensure patients receive the care they need, when they need it.
And as pharmaceutical companies move their focus from brand to disease, they must continue to find new methods for collaborating with payers, patients, and providers alike. Aside from increasing focus on health care management services, this will also depend on creating even leaner, more streamlined operations.
Lessons to Learn from the Pharmaceutical Supply Chain
As the U.S. pharmaceutical sector increases focus on creating a patient-centric supply chain, industries of all kinds can take a page from the pharma playbook.
Implementing new technologies to increase efficiencies, homing in on environmental and sustainability improvements, and enhancing collaborative capabilities to provide end-to-end visibility into the supply chain are vital initiatives for any modern-day organization.
Of course, these efforts can greatly benefit the companies themselves, allowing for higher efficiencies, reduced costs, and heightened reputation. They can also help ensure that the patient — or customer — always comes first, receiving the best possible products and services for their specific needs.
COVID-19 Impact on the Pharmaceutical Supply Chain
As COVID-19 continues to alter the U.S. pharmaceutical market, the pharma sector has been forced to adapt, seeking new medications to treat the virus while also maintaining existing supply chains.
Over the past several weeks, some experts and congressional leaders have warned that American reliance on drugs produced or sourced overseas has created a security risk that could be eliminated by onshoring these operations.
Some pharmaceutical lobbying groups, however, have pushed back against such recommendations, arguing that bringing operations back to domestic soil would be incredibly costly and impractical.
As drugmakers race to find a vaccine for the coronavirus, supply chain shortages and bottlenecks have come into clear view. In particular, a shortage of glass vials could seriously impede the ability to store and package a vaccine.
Efforts to increase efficiency, affordability, transparency, and sustainability in the pharmaceutical supply chain have become increasingly important in recent years — and will only become more vital as we move closer to a COVID-19 vaccine.
Image Credit: Lesterman / Shutterstock
