Pfizer Outlines Its Supply Strategy - Pharmaceutical Technology

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Pfizer Outlines Its Supply Strategy
John Kelly, vice-president of strategy and transitioning sites for Pfizer Global Supply, discusses the company's manufacturing and supply strategy and network.


PTSM: Pharmaceutical Technology Sourcing and Management
Volume 7, Issue 11

Kelly explains that the company’s supply network is focused on four main strategies: to optimize its supply network, optimize its network performance, increase commercial value, and enhance core process excellence. In building a cohesive strategy, Kelly points out that PGS has developed a co-manufacturing approach by combining and consolidating global operations, not only through its most recent acquisition of Wyeth in 2009, but through earlier large-scale acquisitions, namely Warner-Lambert in 2000 and Pharmacia in 2003, as well as through bolt-on acquisitions, with some recent examples being the animal-health care company Synbiotics in 2010, the specialty pharmaceutical company King Pharmaceuticals in 2011, and the consumer-healthcare business of Ferrosan, which the company announced earlier this year that it will acquire.

With respect to its goal of optimizing its supply network, Kelly emphasizes that PGS’s strategy is to optimize internal and external partnerships in sourcing, capacity, capital allocation, costs, and asset utilization. Pfizer uses external partners for approximately 30% of its production on a cost-of-goods-sold basis, which includes API manufacturing and finished-product manufacturing. “External manufacturing is of increasing importance as we look at different ways to supply products,” says Kelly.

In its goal of optimizing network performance and enhancing process excellence, the company measures and seeks continuous improvement in its manufacturing operations and supply-chain activities. The company recently adopted a balanced-scorecard approach for evaluating and improving the performance of its manufacturing network. The metrics from the balanced scorecard are applied on a site-specific basis and divisional level to assess PGS’s performance on processes, quality, and environmental, health, and safety compliance. PGS rolled out the balanced-scorecard approach in part in 2010, and this year is rolling it out fully across its network.

“It helps us understand the progress we are making and how we are improving in several areas, such as how we serve our customers, how we meet our financial commitments, how we engage our colleagues, and how we improve our processes,” says Kelly.


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