Top 10 Challenges Facing Global Pharmaceutical Supply Chains
Heroes may win battles, but it is capable supply chains that win wars [against disease].
This was written by Natalie Privett, Assistant Professor of Management and Policy at the Robert F. Wagner Graduate School of Public Service at New York University, and David Gonsalvez, Professor of Supply Chain Management at the MIT-Zaragova International Logistics Program, and former Global Supply Chain Director with General Motors. They go on to say the global health pharmaceutical delivery (GHPD) supply chains are wanting.
Privett and Gonsalvez interviewed 22 people, all of whom hold different roles in supply chain, and asked them to identify the top challenges as they see them. The output is a research article, entitled The top ten global health supply chain issues: Perspectives from the field.
This research highlights and prioritizes the top 10 global health pharmaceutical supply chain challenges:
- Lack of coordination
- Inventory management
- Absent demand information
- Human resource dependency
- Order management
- Shortage avoidance
- Warehouse management
- Temperature control
- Shipment visibility
According to the article, Lack of coordination in the GHPD supply chain is a root cause issue whose existence aggravates nearly every other issue directly or indirectly.
Not only do capable supply chains win wars against disease they are instrumental in winning battles against counterfeit drugs. In 2009, the World Health Organization (WHO) reported that 34 million counterfeit tablets had been taken out of circulation in Europe in just a two-month period.
I don t know about you but I rarely think twice about the packet of pills that may be prescribed to me when I am ill. I trust it implicitly to make me feel better. I therefore expect the ingredients those pills contain to be safe and do their job effectively and, most importantly, safely. Beyond the obvious harm counterfeit drugs can inflict on consumers, pharmaceutical manufacturers are also concerned about the harm bogus medicine might inflict on their brand. It costs billions to develop, market and distribute drugs. The last thing manufacturers want is for that investment to go to waste as counterfeit pharmaceuticals undermine those efforts.
There are many examples now in the news about counterfeit drugs circulating in black market channels and the places in which it is the biggest recurring problem is in the developing world where, in Africa and parts of Asia and Latin America, the proportion of counterfeit medicines has been estimated to be as high as 30%.
Pharma companies have to manage incredibly complex supply chains and manage the operational challenges of working and interacting with huge numbers of suppliers contributing ingredients and components to drug production. And now they need to meet track and trace directives and comply with new serialization regulations that require inventory to be auditable as it moves through the supply chain.
Companies getting to grips with serialization should consider if their existing supply chain management systems and processes provide:
- Accurate information across the entire chain at any point and at any location
- Instant access to real-time updates and alerts if issues are detected
- Visibility of all handovers in the supply chain
- Traceability back to source of all materials
- Seamless collaboration between all parties
Traditional ERP systems do not provide a holistic and complete view of the production and movement of goods from start to finish that is now needed. With these traditional models, each link in the supply chain has its own systems that often cannot connect into each other so the level of visibility so desperately sought is difficult, if not impossible, to achieve. Networking suppliers, partners, and logistics providers along the supply chain can offer a more comprehensive view of activities. Organizations need a collaborative system that is equipped with reliable information throughout the supply chain.
The Importance of Visibility
The first step toward achieving the directives of track and trace and serialization is to improve visibility throughout the supply chain. Until a company can see all the activity taking place among its suppliers, shippers, vendors, and partners, it ll struggle to prevent leaks in supply chain and importantly have a hard time showing regulators they re following the rules.
A cloud-based supply chain management platform offers visibility to all companies, regardless of size. For a large, multinational pharma business, access to data from all operational regions allows for greater awareness of growth areas, understanding of where hold-ups might exist in the supply chain, and insight into how these might be navigated in order to avoid impact on distribution. And crucially, this can help track and tracing via serialization.