The growth in pharmaceutical outsourcing is creating a more complex and risky supply-chain environment, according to a report issued last week. The report, Achieving Global Supply Chain Visibility, Control & Collaboration in Life Sciences: Business Imperative, Regulatory Necessity, was cosponsored by Pricewaterhouse Coopers (PwC), IBM Business Analytics, and Camstar Systems, and published by Axendia, a life-science and healthcare analyst firm. As a result of this changing environment, states the report, pharmaceutical and life-science executives are on “high alert” and should consider adopting a new approach to controlling supply-chain risks.
One-hundred-and-twelve industry executives from pharmaceutical, medical device, and biotechnology companies worldwide participated in the survey. Fifty percent of survey respondents said that raw materials sourced outside of the United States present the greatest vulnerability in the supply chain, and 61% said that contaminated or nonconforming raw materials are likely to be the top threat over the next five years.
Part of the cause for concern is that drug development is moving more and more to sites in developing countries such as China, India, Mexico, and Brazil—also pharmerging countries—which involves more risk. Key survey findings, according to a PwC Health Industries Group press release, include the following:
“With manufacturing, sourcing, and the sale of medical products expected to increase dramatically in the emerging markets, the geographical expansion of the supply chain will make it more difficult to manage, as will the industry’s changing product mix,” said Wynn Bailey, PwC pharmaceutical and life-sciences advisory services partner. “In order to meet the demands of globalization, the pharmaceutical supply chain will need to become much more flexible, with different manufacturing routes and distribution channels for different kinds of products. Companies will need to implement new strategies, processes, and technology to proactively reduce and control risks.”
In this regard, the report’s authors suggest the following road-map components to a safer pharmaceutical supply chain:
More details about each component are described in the full report.
See related PharmTech articles:
New Report Addresses Pharma Execs’ Top Supply-Chain Concerns (blog post)