Top Challenges Facing Pharma Supply Chains
By David Parker
2020 was a year of unprecedented disruptions for the pharmaceutical supply chain sector. In fact, the full impact of the COVID-19 pandemic won’t be known for months. What we do know is that the pandemic has uncovered the limits of the current pharma manufacturing model.
How can pharmaceutical companies mitigate the impacts of COVID-19 disruption? To survive, pharmaceutical leaders need to take rapid, aggressive steps to sustain their business operations while protecting their employees and serving their customers. Technology will play a critical role; obtaining continuous visibility and continuous intelligence within organizations’ supply chains will be the key to their chances of surviving crises such as these.
Here are the biggest supply chain challenges for 2021, as well as ways pharmaceutical companies can overcome these obstacles and be prepared for the next unexpected event.
- Lack of visibility into the cold chain. Cold chain companies need to know real-time information about the condition, timing and location of their products, raw materials, and subcomponents. Without this kind of detailed data, pharmaceutical companies are hampered with tunnel vision, since they don’t have the real-time location, temperature and humidity data for their perishable products.
- Temperature excursions. According to the IQVIA Institute for Human Data Science, the biopharma industry loses $35 billion annually due to temperature-control failures across supply chains. These jeopardize drug quality and stability, as well as compliance for products that are shipped globally. Pfizer’s COVID-19 vaccine needs to be stored between -70°C and -60°C. For the Moderna vaccine to remain viable, it needs to be maintained at standard refrigerator temperatures of 2–8 °C for 30 days, while shipping and long-term storage conditions must be at standard freezer temperatures of -20°C (-4°F) for 6 months. Any kind of temperature excursion from this range could result in an entire shipment of spoiled vaccines. Obviously, temperature excursions can have costly ramifications, as they can lead to products being quarantined or being declared a complete loss.
- Real-time data collection throughout transit is one of the biggest issues facing pharma supply chains. Without real-time data on your products, you can’t take timely actions on anomalies such as temperature excursions. It is exceedingly difficult to identify the cause of damage or delays without real-time location and condition data. The lack of real-time data also makes it impossible to allocate resources to ensure that shipments are handled efficiently since you lack insight on ETA.
- Maintaining pharmaceutical compliance. In recent years, the number and complexity of regulatory business requirements have increased substantially. Non-compliance can have an extremely negative effect on cost, reputation, and patients’ lives.
- Accurately forecasting demand. One of the thorniest challenges for pharmaceutical supply chain professionals is accurately forecasting demand so that all pharma products are produced on time and successfully delivered. End-to-end visibility is essential to have the right inventory in the right place at the right time, to avoid obsolete inventory, to have safety stock, to be able to fulfill omnichannel orders and to perform demand forecasting.
How Pharma Supply Chains Can Mitigate Obstacles
- Adopt digital technologies — COVID-19 has accelerated the digitization efforts for vaccines and supply chain tracking, given the billions of vaccine doses needed. Accelerating digital initiatives in the pharma supply chain is key to improving efficiency and agility. A digital supply network creates a single source of truth that enables all organizations in the supply chain to plan and adapt as needed. In addition, adopting digital technologies such as AI, machine learning and automation can help pharma companies anticipate and prevent noncompliance through predictive intelligence. Using granular ground-truth data, organizations get alerts, notifications, metrics, trends, analytics and KPIs to ensure accurate and fast regulatory reporting. Ground-truth data also ensures that upstream and downstream enterprise systems of record will reflect accurate inventory levels and locations; this data can then be used to improve planning systems’ forecasts and simulations.
- Address gaps in visibility — By addressing gaps in supply chain visibility, pharmaceutical companies gain more control of their supply chain and can mitigate issues before they cause significant loss. By having visibility across the supply chain, pharma companies can optimize their inventory levels, increase flexibility in response to short-term demand fluctuations and avoid product overages/shortages. Cloudleaf can help organizations identify where their visibility gaps are, how many gaps they have, and how those gaps are impacting their business.
- Employ real-time sensors — Next-generation digital supply chain solutions such as the Cloudleaf Digital Visibility Platform can help mitigate losses. Cloudleaf has a rich API library so you can use the device best suited to your application. Being device-agnostic future-proofs your platform investment. That said, Cloudleaf works closely with device vendors and has added several IoT sensor integrations into its ecosystem, most recently with Biotempak, Quuppa and Wiliot. Cloudleaf’s IoT partnerships enable applications including active cold chain monitoring, asset and inventory monitoring, airport and plane data coverage, location proximity accuracy, and even employee safety for functions like temperature, location and oxygen saturation monitoring.
There are many challenges facing pharmaceutical supply chains, ranging from the lack of visibility and logistics coordination to maintaining regulatory compliance and avoiding temperature excursions. Only those pharmaceutical companies that have optimized their supply chains will continue to thrive. Moving forward, the development of an intelligent and agile pharmaceutical supply chain will be the key to creating a global network of trade that is capable of weathering current and future disruptions.
To take the first steps in transforming your supply chain, reach out to ParkourSC.