As we have witnessed over the last two years, when functioning correctly, global supply chains broaden access to critical medicines for billions around the world. Yet any number of situations, from macro events like the ongoing pandemic, the 2010 volcanic eruption in Iceland, geopolitical instability, or simply patient misunderstandings, can lead to expensive and often unnecessary wastage.
The pharmaceutical industry has a complex global supply chain. One that requires regulatory scrutiny, a raft of compliance checks, as well as the challenges associated with transporting products that are often both temperature and humidity-sensitive. As the international case for vaccine equity gains momentum, there is a recognition of the need for better distribution of vital medications – particularly in less economically developed countries.
In this blog, I explain how modern, connected supply chains can help pharmaceutical companies, NGOs & IGOs better manage over-the-counter products, reduce wastage, and support global initiatives for more equitable distribution of COVID19 vaccines.
Recognition and Responsibility
For many years, waste and inefficiency have been a concern for health services, pharmaceutical providers and governments. In the UK alone, wasted and unused medicine is estimated to cost the NHS £300 million every year – a problem that extends far beyond patient behaviour.
In ensuring vital products are always available at the point of demand, pharma supply chain parameters, in tandem with national government demands for ‘safety stock’, have led to over-supply, which in turn has led to products remaining unused by expiry dates.
In a world where the pandemic is still far from behind us (sadly), governmental bodies like FEMA in the USA and pharmaceutical giants like Pfizer need to address the supply chain issues that have been highlighted by global disruption over the past two years; issues that have encouraged countries (especially richer Western countries) and consumers to over-order and stockpile.
With the gradual recognition over the last six months that the pandemic will not be over until the majority of the world (not just the majority of a single country’s population) is adequately protected, private organisations, NGOs and governments alike are beginning to recognise the growing corporate responsibility and expectation for a wider and fairer distribution of essential equipment (like lateral flow kits and PPE), drugs and vaccines.
If this is to be achieved in any truly meaningful way, existing supply chain processes must be made more efficient and also, I would argue, transparent too. By eliminating the endemic red tape and waste within consumer-driven manufacturing, distribution and political processes, it should be possible to free up the quantities of vaccines, testing and protective equipment required in developing nations to meet the World Health Organisation’s (WHO) calls for greater health equity.
Digitisation transforms how pharmaceutical companies can control the end-to-end supply chain, and data capture is fundamental to that process. Companies must capture information for products from the EU Falsified Medicines Directive, which mandates that every product has a GS1 data matrix code, to the introduction of Crypto Codes in Russia.
In tandem with the rapid adoption of the Internet of Things (IoT), cloud-based data capture/storage, and the use of advanced analytics (including AI), data can provide organisations with advanced end-to-end visibility across their supply chains and the ability to make rapid changes at the point of need.
With real-time access to information that includes production and expiry dates, as well as storage requirements, inventory management can be more intelligent, and you can manage any supply chain glitch (from warehouse issues to traffic jams delays) in real-time.
Companies can reallocate products between locations (manufacturing sites, distribution centres, warehouses and even within pharmacies) on-demand, using real-time stock visibility to manage and meet demand deadlines. Stock can be reallocated using expiry dates, ensuring products with short lifespans have the best chance to arrive at the needed location and be used by patients with the greatest demand.
The entire process is dynamic, intelligent and designed to maximise availability without requiring expensive and potentially unnecessary hoarding of ‘safety stock’.
End-to-End Visibility is the Key
With the ability to track products throughout the entire supply chain, pharmaceutical companies can make key efficiency improvements.
One of the biggest challenges for pharma has been the lack of insight into the end user’s behaviour. Patient prescription information is not available for privacy reasons, making it hard to forecast demand, which often leads to overstocking. However, the growth of population health data in tandem with powerful data analysis tools is allowing organisations to gain far more insight, more quickly, into changes in demand.
This population health data can feed into national strategies for so-called ‘safety stock’ of vital medication like vaccines and help countries minimise over-ordering. Essentially this means fewer vaccine mountains in richer, western countries and more doses available in the less economically developed nations, where they are needed most.
Let’s be clear, creating more visibility, efficiency and accountability within supply chains will not fix vaccine equity overnight miraculously. However, understanding the supply chain at a more granular level and identifying whether problems are temporary or likely to have a long-term impact will allow more accurate allocation of vaccines throughout distribution networks.
And it is these capabilities that are an important piece of the puzzle for wealthier nations seeking to meet their vaccine quotas in parts of the globe where roll-out programs and vaccine uptake to date have been largely absent but are so desperately needed.
Manhattan Associates is a technology leader in supply chain and omnichannel commerce. We unite information across the enterprise, converging front-end sales with back-end supply chain execution. Our software, platform technology, and unmatched experience help drive our customers’ top-line growth and bottom-line profitability.
Manhattan Associates designs, builds, and delivers leading-edge cloud and on-premises solutions so that across the store, through your network or from your fulfilment centre, you are ready to reap the rewards of the omnichannel marketplace.
This blog post is sponsored by Manhattan Associates.