Pharmaceutical Supply Chain

Transcription

1 Pharmaceutical Supply Chain Town Hall Presenter: Bill Rhind Regional Director, US & Canada Goldratt Consulting Facilitator: Sharon Rice Executive Vice President APICS, Inc Pharmaceutical Supply Chain Simplified 1

2 Pharmaceutical Supply Chain 3rd Party API Production 3rd Party Formulati on 3rd Party Packaging Manufacturing API Formulation Packaging Shipping Regional Regional Regional // Clinics Clinics // // p / Clinics / / / / i / // Pharmacies / / Hospitals Pharmacies / Pharmacies Pharmacies Pharmacies Pharmacies Hospitals / 1000s Hospitals Pharmacies / Hospitals / Hospitals / Practitioners Millions of Patients Counterfeiting/adulteration is a significant issue, but tracking and tracing is difficult Due to packaging complexity and supply chain visibility across the globe But necessary to locate product, verify origin, and authenticity (pedigree) Planning based upon imprecise forecasting As opposed to the pull of actual demand Core conflict: increase or reduce inventory Increasing inventory creates excess stock (stock piling), reducing inventory reduces waste due to expired product In the case of vaccines, season generally shorter than replenishment lead time 2

3 Short shelf life Becomes shorter when products have longer lead times to market Demandhighly variable Due to seasonality, innovations in product development, advertising/marketing directly to the consumer More difficult to plan, manufacture, and supply to meet demand Necessary quality management and regulation Difficult across national/political boundaries Adds cost, time, influences availability Shortages produce a grey and black markets Adding to the lack of visibility and concerns about quality Globalization Has extended the supply chain and contributed to increased risk to supply disruption Transparency a major issue exacerbated by the complexity of the global supply chain Consolidation of manufacturing Increased impact of quality issues/failure at individual manufacturing sites Companies choosing not do business in small or otherwise unattractive markets impact patients in those markets. Shortages of raw materials needed to develop APIs 3

4 Disruptions due to natural and political disasters Drug diversion allows sub potent or adulterated pharmaceuticals into the market Web distribution Makes it more difficult for consumers to know the pedigree of the drugs they are buying. Risk in the Pharmaceutical Supply Chain UK research study conducted by the Bradford University School ofmanagement to gain more realistic understanding of the nature and prevalence of risk in the pharmaceutical supply chain. Identified 35 prevalent risks and ranked them based on impact, occurrence, and controllability. JServ J.Serv. Sci. & Management, 2008, 1: Published Online August 2008 in SciRes ( 4

5 Top Risks Identified Risk Rating Risk Rating Fragmentation of supply chain 10 Demand/economics inability 8 no single source, multi channels, unilateral decisions to respond to demand Lack of visibility of stock 9 Inadequate buffer stock 8 Unexpected increase in demand 8.5 Contracting treated as a commodity big contracts drive competitors out of market 8 Demand versus capacity 8.5 Transportation 7.5 Information flow or lack of info 8.5 Manufacturer defense tactics 7.5 Lack of forecasting customer side 8.5 Diversion of manufacturing capacity Availability of raw materials 8 External influences disaster recovery Mid Level Risks Identified Risk Rating Risk Rating Stock holding more concentrated 7 Counterfeiting 6 Exploitation 6.5 Increase in demand due to NICE approval, patient involvement, press 6 Dispensing/picking errors 6.5 Rationalisation of range 5.5 Decrease in capacity linked to profit 6.5 Cash flow/cash management threat associated with small companies and hospitals 5.5 Too much information 6.5 Storage/cold chain 5.5 Short term supply chain planning 6.5 Reimbursement policies not 5.5 consistent Operational li in/efficiencies i i e.g. 6 Response of industry to systems operating properly shortages/communications Non standard practice customized policies per hospital 6 5

6 Risks/Ratings Identified Risk Rating Risk Rating Loss of expertise 5 Procurement hubs introduce 4.5 unsophisticated purchasing / more complexity practice Risk of litigation influence on market 5 Theft 4.5 Lack of knowledge regarding manufacturing process or source of supply 4.5 Prioritization conflict between patients/profits 4 6