The Pharmaceutical Supply Chain Reform We’re Not Talking About Enough

COVID-19 vaccines and treatments appear to be forthcoming. When the lifesaving drugs are ready, will logistics and transportation systems be able to keep up?

Amid the coronavirus pandemic “stress test,” global supply chain vulnerabilities have been laid bare. PPE shortages resulted in chaos and frustration as suppliers faced a massive (and sudden) surge in demand, export bans and production and transportation challenges.

Now that economic recovery and the much-anticipated “return to normalcy” largely hinge on successful vaccines and treatments. Strengthening the supply chain has become a public health priority. Once these drugs are available, they’ll need to be distributed as quickly and efficiently as possible. As the focus turns to the pharmaceutical supply chain, governments in the U.S. and Europe have introduced new legislation. This new legislation increases both the geographical diversity of production and visibility into the supply chain. It also establishes detailed databases of drug manufacturing facilities.

The new legislation is a good starting point where digital supply networks will be key. Increased visibility and supplier diversity are indeed critical to future-proofing supply chain operations. But long-term success will require us to examine all facets of the pharmaceutical supply chain. However, the industry faces no shortage of challenges in optimizing transportation management and logistics. Find out more about Elemica’s solution.

Transportation and Logistics Challenges Facing the Pharmaceutical Industry

The pharmaceutical industry relies heavily on cold chain cargo space in trucks to transport vaccine-related products. But freight options have become drastically reduced as restrictions on shipping, worker shortages, lack of drivers and freight costs have skyrocketed. And adapting logistics and transportation methods means working against the clock since a large number of raw materials for pharmaceuticals and goods used in biotechnology require transport under special conditions and many of the drugs have limited lifespans.

These challenges are new to the many that existed pre-COVID. They include volatile fuel prices, regulatory complexities, and aging transportation infrastructure. The pharmaceutical supply chain has also been notoriously fragmented. Many companies lack the IT infrastructure necessary to share and leverage real-time data or monitor suppliers and disruptions.

The world is looking for long-term solutions. Widespread adoption of transportation management systems (TMS) will play a key role in making lifesaving drugs more available and affordable. In fact, TMS can improve margins for shippers by reducing net landed costs of goods by as much as 30 percent.

Three Key Ways to Ready Your Pharmaceutical Transportation Management System

Suppliers of PPE and medicine have experienced a wake-up call to adapt and modernize. They will need to strategically choose supply chain solutions that help them rise to the unique challenges of the present. Additionally, they will need to future-proof for other unforeseen events, disruptions, and even new legislation.

While this is a lofty goal, we can break it down into objectives that address the underlying shortcoming and inefficiencies of the “status quo.” Here’s where to start.

Objective #1: Enhance collaboration among logistics service providers

Pharmaceutical manufacturers and their logistics partners can no longer operate in silos. Transportation information and updates must be up-to-the-minute. They must also be ready to ensure that medicines can be available exactly where and when they’re needed.

Solution: Increased operational visibility via a digital supply chain network

In the supply chain transformation’s hierarchy of needs, a digital supply chain network is foundational. Where transportation and logistics are concerned, a digital supply network creates a “single source of truth” that helps all parties plan, adapt, and manage customer expectations.

Clearly, this transformation involves more than just flipping a switch. Organizations will need to evolve their entire processes and potentially even personnel and roles.

See White Paper “Is Your Organization Prepared for Transportation Planning Implementation?”

Objective #2: Eliminate human error in supply chain logistics

Manual tasks, like accepting shipments, sending updates, invoicing, and organizing documents, leave too much room for error. Once a digital supply network is in place, organizations can leverage a wide range of tools to automate many tasks (and free up working capital and resources).

Solution: Automation-ready infrastructure

Automation capabilities are limitless with the right solutions in place. Those include accelerated invoicing via shipment confirmations to automated status alerts and even IoT integration. Many of these capabilities are packaged into convenient apps and tools that solve common everyday pain points. Some examples include onboarding logistics providers and checking email for shipment updates. Automation can even help pharma companies better navigate market-specific complexities

See White PaperCompanies with Global Logistics Face Unpredictable Challenges

Objective #3: Shift from reactive to proactive operations

The coronavirus crisis exposed many cracks in the supply chain including a lack of preparedness for shifts in market demand and supply. Adopting the right technologies allows pharmaceutical companies to react to disruptive events before they lead to significant issues like shortages of critical medications.

Solution: Predictive analytics

No one can predict the future. But it is entirely possible to predict disruptions to orders or shipments based on information within your suppliers’ systems or certain world events that pose a risk. Visibility and predictive solutions are growing smarter by the day. These solutions alert pharmaceutical companies to potential risks and business impact so they’re empowered to make quick, data-driven decisions.

More resilient pharma supply chains. Better outcomes.

Improved pharmaceutical logistics, including robust transportation management systems, will play a key role in public health globally. Now is the time for companies to build digital capabilities that will help mitigate disruptions brought by the pandemic. Build speed and resiliency to prepare for any future health crises with Elemica.

Ready to learn how Elemica’s digital supply network and TMS can help you optimize and future-proof your own logistics? Explore the capabilities of our Logistics Management Suite here.