Theft, counterfeit drugs, temperature-control and regulatory compliance force supply chain managers to initiate change
A new white paper released today by Exel, the North American leader in contract logistics, in conjunction with its sister company DHL Supply Chain, the world’s leading logistics company, has revealed that theft, pharmaceutical counterfeiting, condition/temperature-control and regulatory compliance are among the top concerns of global life sciences and healthcare (LSH) companies. According to the white paper, substantive supply chain changes are necessary to increase stewardship toward ensuring product security and ultimately protecting end consumers.
‘Protecting Products to Save Lives: Securing the Pharma Supply Chain’ a white paper by Exel in conjunction with Lisa Harrington, President of lharrington group LLC, identifies two key areas of regulation that supply chain managers should be aware of to protect their products and reputations.
- Security from theft and counterfeiting. The white paper cites that the World Health Organization estimates about one percent of sales in developed countries and more than ten percent of sales in developing countries are counterfeit. In response to this threat, governments are issuing new pharmaceutical track and trace regulations centered on product serialization. This involves assigning a unique number to a particular unit and tracking it throughout the supply chain, a process that is expensive to implement in the supply chain. In fact, the paper includes data suggesting that adapting supply chains to comply with these regulations can cost nearly $53 million per year. To better manage this cost while remaining compliant, LSH organizations can partner with third-party logistics providers (3PLs) that are developing serialization systems for multiple manufacturers.
- Strict product temperature control and measurement. Pharmaceutical portfolios are evolving toward more structurally complex biotechnology drugs that are sensitive to their environments and expenditures developing those drugs are expected to quadruple from 2012 to 2020. Biotechnology drugs have specific condition tolerances and can cost $1,000 per dose. Failure to meet the condition requirements can result in a loss of up to $50 million per shipment. To maintain product integrity, supply chains must be equipped with temperature-control, temperature-monitoring devices and other environment-control capabilities from end-to-end.
“Addressing these challenges without local market knowledge or suitable facilities can be extremely difficult, and costs can soar. LSH companies have to configure their business for each market, meeting the regulatory requirements and operational constraints of each healthcare system. Add in regulatory compliance, temperature control and other factors, and the supply chain will become highly complex,” said Wayne Wooddell, Vice President, Business Development for Life Science and Healthcare in the Americas, Exel. “Understanding life-threatening implications of unsecured product is a job we take seriously. From insight gained on unique customer requirements, we are able to create solutions to help our LSH customers face these challenges. Our global expertise, serialization methods and cold chain capabilities mean we can provide manufacturers with the security they need while managing costs.”
Exel, in conjunction with its sister company DHL Supply Chain, has expanded its global network of LSH services by over 25 percent since 2012 with the addition of 30 new warehouses, 12 of which are in emerging markets. It now operates more than 150 facilities comprising over two million square meters of warehousing space and 1.9 million pallet locations dedicated to LSH, with more than 4,500 dedicated healthcare staff and more than 70 pharmacists worldwide. Global capabilities are often adapted in the U.S. for a local fit.
Download and view the full report at www.exel.com/securingpharma. For more information on supply chain best practice, solutions and success stories, visit Exel LSH at http://www.exel.com/exel/exel_life_sciences.jsp