5 Trends Impacting the 2019 Pharmaceutical Supply Chain2019 Pharma supply chain trends focused on cost cutting, R&D and patient outcomes
Increased emphasis on improving patient outcomes, reducing drug pricing and expediting drug development have put the pharmaceutical industry at odds with regulators and the patients it serves. From top pharmaceutical companies to smaller biopharmaceutical companies focused on clinical trials for FDA approval, the pharmaceutical industry is struggling to find ways to meet these challenges.
Here are a few of the most notable trends impacting the prescription drug industry:
1. Drug Pricing Pressure Drives Focus on Operational Efficiency
Drug prices seem to be the object of much public scrutiny, complaint and discussion these days, in the United States and across the globe. The pharmaceutical and life science industry needs to devise new ways to enhance operational efficiency, including turning to new, advanced technologies including AI as well as to established systems including leading edge warehouse management software. 2019 is poised to be a year that demonstrates resolve in streamlining processes and increasing workforce productivity.
Pharmaceutical companies are showing increased interest in boosting investments in real time data-oriented technologies that can bring fresh insight to solve industry challenges. As part of the cost containment effort as well as for the purpose of expediting the development and testing of new drug products, pharmaceutical companies are developing and implementing new ways to handle, store, distribute and administer temperature-and time-sensitive drug products. An important issue arising in cost containment involves the ability to administer these specialized, highly sensitive therapies to individual patients without breaking the bank.
Adapting the pharmaceutical supply chain to accommodate new personalized medicines and therapies for efficient, cost-effective patient delivery will require changes. Altering the pharmaceutical life science supply chain provides an opportunity to restructure it so as to eliminate or reduce steps and streamline timelines and costs.
2. Restructuring of Big Pharma
Over the past few years, there has been considerable buzz about biopharma companies reconsidering their existing business models. Some of the reasons for the increased scrutiny include:
- Increased pressure on government healthcare budgets
- Interest and adoption of innovative, new technologies
- Challenges to established patient-to-payor pricing mechanisms
- Payor emphasis on cost management
- Morass of regulations in many parts of the world
- Internal corporate culture of pharmaceutical companies
- Siloed divisions of supply chain, manufacturing, R&D within pharma companies
As the biopharma company restructuring advances across the industry, issues involving process disruption and staff distraction sometimes cause a short term drag on productivity and the effectiveness of some restructuring efforts. Restructuring has numerous benefits as for many companies it is:
- Divesting under-or poorly-performing facilities and businesses increases financial capacity
- Improving financial capacity, enabling the re-stocking of pipelines with promising new drug products
- Creating opportunities for service providers, especially for legacy products, more services to gain efficiencies, etc.
- Refocusing R&D
One major area of change is the transition to new business models. Pharmaceutical and life science companies are transitioning to cross-functional models, restructuring existing operations in a manner that connects the disparate interdependent groups together into a “critical team”. Directly responsible for collecting and analyzing information, critical teams assess the information and provide insights and strategic plans involving typically overlooked facets of the pharmaceutical business. This includes medical, regulatory and government affairs as well as pricing and market access. Critical teams are designed to be cross-functional, independent groups that work closely with various departments within the pharmaceutical business including key account management, sales and marketing, supply chain and R&D and pharmacovigilance. One of the benefits of the critical team approach is that it is truly cross-functional and provides value in advancing the needs of the organization as a whole.
5 Big Pharma companies that have announced restructuring include:
3. Investment Boom in Personalized Medicine
What is personalized medicine? The concept of personalized medicine is used to refer to therapies customized to meet the individual needs of each patient. Therapies are tailored to produce the likelihood of a best response as well as the highest safety margin for improved patient care. The strategy of personalized medicine facilitates earlier diagnoses, risk assessments and optimized treatments to improve the quality of healthcare to enhance patient outcomes and lower costs.
PM represents a sea change to standard research and development of pharmaceuticals and the treatment of patients. The PM approach involves the identification of genetic, clinical and epigenomic information to enhance an understanding of how each individual’s unique genomic portfolio increases the likelihood of vulnerability to certain diseases.
Refining and executing this approach has the potential to demonstrate significant reductions in time and financial expenditures as well as to improve the quality and length of human life. Using the PM approach, preventative medicine takes center stage and results in more pro-active activity to delay or prevent the need for more severe treatment. These treatments tend to diminish quality of life and are typically more expensive.
The trend towards personalized medicine has significantly altered the way drugs are developed and administered. This is especially true in the instance of drugs used to treat patients for illnesses including rheumatoid arthritis, multiple sclerosis, breast cancer as well as other forms of cancer. Personalized medicine comes with a high price tag, however. Over the past 20 years, there has been a noticeable decline in R&D investment returns across the pharmaceutical industry. This has led to a decrease in the development of prescription drug products, undesirable for patients as well as for the life science industry. This has had an impact on the price of prescription drugs partially due to the lack of competition for some products.
4. Pharma Turns to Advanced Technology-NOW
As with many other industries, innovative technologies have taken hold and are making an impact in the pharmaceutical sector. Today, pharmaceutical companies are using, storing, accumulating and analyzing vast stores of data on patients, processes and products. Leveraging all this data using Big Data solutions and cloud computing technologies has already proven beneficial in helping “connect the dots” and provide a more complete perspective on issues such as patient health care, effectiveness of prescription drugs, pharmaceutical supply chain operations and much more. Using these cutting-edge technologies has aided pharmaceutical businesses to have access to real time, accurate information that can be used to make changes that can result in cutting costs and producing better outcomes for patients.
Life science companies need to be able to integrate their systems and aggregate data. Using predictive analytics with data can result in significant improvements to prescription drug manufacturing, supply chain forecasting, the identification of counterfeit medicines and much more.
IoT sensors, monitoring devices and trackers are all the rage in the biopharma industry. IoT devices provide a stream of data that can be captured and analyzed to enable more effective supply chain management, drug manufacturing operations and equipment and asset management.
Drug development is now utilizing artificial intelligence (AI). With the steady increase in prescription drug pricing and decrease in drug development, pharmaceutical companies have needed new tools for the drug research and development process. 9 out of every 10 drugs in development fail to reach the pre-registration stage due to poor absorption, efficacy, distribution, metabolism or excretion. Using AI, drug manufacturers can map out drug structures and targets to help facilitate the development of more successful drug products, minimizing or eliminating pricey scientific development.
5. Data Integrity Challenges Across the Pharmaceutical Supply Chain
Over the past few years, the FDA and other regulatory agencies have demonstrated greater concern regarding data integrity. As the pharmaceutical industry transitions and embraces the use of digital tools and capabilities, more data is collected, stored, reported on and analyzed. This includes data from devices such as temperature fluctuations. “A culture of quality” with respect to data integrity has been linked to improved patient outcomes. Focusing on data integrity can help facilitate better patient health, adherence to regulatory standards and other benefits.
In the past few years, the use of biologic pharmaceuticals has increased notably. What are biologics? Biologic drug products are those which include some component of living entities such as cells and tissues that have been isolated from a human, animal or microorganism. Biologics are usually produced using cutting edge innovative technologies that are at the forefront of biomedical research. More complex in nature that typical small molecule drug products, biologics are not easily identified, characterized or replicated. Biological products tend to be highly sensitive in nature to factors including temperature, humidity, light, vibration and shocks. More expensive than small molecule medications, biologics, sometimes referred to as large molecule drugs, are used in the treatment of chronic conditions including rheumatoid arthritis and cancer.
The necessity of highly controlled storage, handling and transportation of large molecule drug products has led to increased adoption of technology in pharmaceutical logistics. Today, packaging innovations, monitoring and tracking device advancements and other tools that rely on IoT. Using IoT-enabled devices provides vital real time data that can be analyzed and used to optimize processes as well as for other purposes. As with all data, this information must adhere to the requirements for integrity.
Pharmaceutical manufacturers, warehouses and distribution centers, 3PLs and others across the pharmaceutical supply chain logistics industry utilize data from IoT devices to facilitate documentation of regulatory compliance. Data from IoT devices can be fed into warehouse management systems and aid in optimizing operational process and workforce labor performance.
2019 will undeniably be a year of change across the pharma supply chain industry. Pharma companies are seeking innovation in manufacturing, improved quality control and enhanced drug supply chain security, all while reducing costs and enhancing patient outcomes.
As pharma supply chain companies restructure and implement sophisticated new technologies, patients wait and hope for a better future for prescription drug prices and healthcare delivery.
Whether your business involves pharmaceutical manufacturing or packaging or supports the pharmaceutical supply chain, you need an advanced, flexible warehouse management system specifically developed for the pharmaceutical industry.
Here are some of the specialized features of our WMS:
- Documentation and compliance with government regulations
- Serialization with aggregation
- Validation services
- Quality control features
- Pharma sample management
- HDMA labels
- Rules-based, flexible processes
- EDI/integration ready system
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