Keys to Navigating the Complex Drug Supply Chain

Blockchain for transparent supply chain tracking | Image Credit: ©Andrey -stock.adobe.com

The pharmaceutical supply chain is a complex ecosystem consisting of procurement, ingredients suppliers, contract manufacturers, regional regulations, temperature controls, and track and trace technologies. This ecosystem is highly impacted by facility quality deficiencies, which can delay manufacturing and create drug shortages (1). The threat of anticounterfeit drugs is also a spoke in the wheel, with technologies and regulations working together to safeguard patients (2).

“The pharmaceutical supply chain is like a global relay race involving suppliers, manufacturers, distributors, pharmacies, and regulators,” explains Dr Damodharan Muniyandi, chief quality officer–Global Quality & Regulatory Affairs at Sai Life Sciences. “Complexity tends to arise from sourcing APIs and excipients worldwide, meeting diverse regulatory requirements, managing cold chain logistics for biologics, and tackling counterfeit risks. To navigate this complexity, companies are turning to digital supply chain platforms, predictive analytics, and multi-tier supplier networks for resilience. Quality-by-design and continuous manufacturing help maintain consistency, while cross-border regulatory harmonization builds transparency and agility. It’s about blending smart technology with robust partnerships to keep medicines moving safely and efficiently across the globe.”

Integrated digital systems offer real-time visibility and ensure compliance, according to John DiPalo, chief strategy officer for ACSIS, part of Antares Vision Group. “Technologies like serialization and centralized data platforms help manufacturers track product movement, spot irregularities, and quickly respond to issues, protecting patients and preserving brand reputation,” he says.

“Digital technologies—RFID [radio frequency identification], IoT [Internet of Things], and AI [artificial intelligence]—transform fragmented processes into a transparent, resilient, and responsive network, enabling accurate demand planning, reduced waste, and better service levels,” concurs Grethe Bonde, marketing communications specialist at Murata.

Pharmaceutical companies establish quality control departments to manage supply chain issues, according to Sundar Narsimhan, chief procurement officer, Neuland Laboratories Limited. These departments follow guidelines, such as those established by the International Council for Harmonisation (ICH) and local regulatory agencies.

Differing political and regulatory climates can make managing a drug supply chain even more complex. “In the current context, the volatile geopolitical situation coupled with unprecedented tariff escalations and new drug price prospecting have elevated this to a new level,” says Narsimhan.“We are witnessing a real fragile supply chain situation as we speak.”

Sticking to the basics and a commitment to enduring relationships with supply chain stakeholders is key to navigating this ever-changing situation, according to Narsimhan. “Given the scale of damage that loss of business or customers can cause, keep your calm and a watchful eye on the daily developments, such as tariffs, customer and supplier voices, and demand and inventory data,” he advises. “Take very well-thought-out positions on price, concessions, cost-sharing, and commitments for the short-term, keeping in mind that this situation will not last forever. Finally, be very agile and alert to make changes in response to emerging situations—on shipment routing, inventories, and so on.”

Tariffs and regulations

The country-to-country variety in regulations from government and standard-setting organizations adds to the complexity of the supply chain. “Fragmented regulations can lead to unexpected compliance issues, product recalls, or halted shipments,” Sade Mokuolu, PhD, regional business development manager, life sciences, Watson Marlow Fluid Technology Solutions, states.

A common regulatory language and standardized regulations enhance supply chain security, says Bonde. “Global standards, like GS1 for product identification and serialization, reduce errors and fraud. In the EU, the Falsified Medicines Directive (FMD) is a prime example: it mandates unique identifiers, tamper-evident features, and verification through the European Medicines Verification System (EMVS). This harmonized framework prevents counterfeit medicines from entering the legal supply chain, strengthens traceability, and ensures consistent product authenticity and quality across markets,” she says.

“Standardized rules foster clearer communication between manufacturers, suppliers, regulators, and consumers,” Mokuolu agrees. “This transparency strengthens relationships across the supply chain and supports responsible product stewardship.”

“Organizations such as ICH, PIC/S [Pharmaceutical Inspection Co-operation Scheme], and WHO [World Health Organization] are driving this harmonization of GMP [good manufacturing practice] standards, making audits easier and compliance less costly. The result is a supply chain that’s more transparent, more trusted, and far better equipped to keep medicines moving quickly and safely from manufacturer to patient, no matter where they’re made,” agrees Muniyandi.

A shared framework for complying with different global supply chain regulations that includes data exchange, product serialization, and traceability is necessary, according to DiPalo. “This consistency allows smooth interoperability among global partners, simplifying compliance and improving visibility and accountability throughout the supply chain,” he explains.

Regulators have been making headway on securing the drug supply chain in recent years. In August 2025, FDA created a new program to decrease US reliance on foreign manufacturers. The FDA PreCheck Program will have a two-phase approach to the development of new manufacturing facilities in the US, allowing manufacturers to communicate more directly with the agency on things like facility design, construction, and pre-production. It will also streamline the development of the chemistry, manufacturing, and controls section of a drug application through pre-application meetings and feedback (3).

The European Medicines Agency (EMA) is dealing with drug shortages by focusing on specific areas. In July 2025, the agency issued recommendations for securing the supply of anti-D immunoglobulins used to prevent RhD immunization during pregnancy in the European Union (4). And in April 2025, EMA published recommendations to strengthen the supply chain of radiopharmaceuticals (5).

Recent political impacts have also added to the complexity of the drug supply chain. The Trump administration’s changing tariff policies in the US have forced companies to reassess their supply chains and operations (6), and the flow of APIs and raw materials has been disrupted.

Jason Waite, an international trade expert at Alston & Bird, stressed that pharmaceutical companies should build cross-functional trade compliance teams in response to rising global trade tensions—particularly potential Section 232 tariffs. Compliance regarding product origin, classification, and valuation, must occur early in R&D and manufacturing to avoid downstream disruptions, he said in an interview with Pharmaceutical Technology®. He also emphasized proactive communication between R&D, finance, logistics, tax, and trade departments to help successfully navigate trade policy changes (7).

Best practices to secure the supply chain

Performing best practices can help minimize disruptions brought about in the manufacturing process. Strict GMP adherence on the shop floor can ensure quality, says Muniyandi, as can using process analytical technology to perform real-time monitoring, validating equipment, and properly training staff. “Machine learning can spot potential quality issues early, optimize processes, and keep batch cycle times under control. IoT sensors enable predictive maintenance to prevent breakdowns, while IoT-enabled logistics track environmental conditions and location once products leave the plant,” he says. “Together, these measures create a clear chain of custody.”

Strong in-line quality controls are key, says DiPalo, specifically machine vision inspection, leak detection, and material verification. “These systems lay the groundwork for the simultaneous use of unique serial numbers and aggregation management, which enables unit-level tracking with serial numbers and aggregation codes,” he says. “Combining this with data from a reliable serialization platform provides complete traceability from manufacturing to the patient, allowing quick responses to recalls, theft, or diversion. These steps together ensure both quality assurance and complete visibility.”

“In manufacturing, quality is ensured through in-process controls, environmental monitoring, and process validation, while traceability is achieved via unique serialization and aggregation,” Bonde says. “RFID and IoT sensors create digital product passports, tracking each unit’s journey and monitoring critical parameters, such as temperature and humidity, in real time. This enables rapid recalls, minimizes waste, and ensures compliance up to the point of care.”

When it comes to using automated inspection systems in the pharma industry, Eran Sinbar, CEO of Yoran Imaging, stresses that they be performed non-invasively and in a way that links inspection data to unique product identification, “two key reasons that thermal imaging-based inspection is beginning to make inroads.”

Utilizing supplier quality management provides a structured approach for ensuring materials, components, and services received by third-party suppliers meet quality and regulatory standards, says Mokuolu. “For drug products that utilize single-use technologies, establishing a consistent set of compliance information across all single-use suppliers enables drug manufacturers to make more accurate comparisons and ensures confidence in dual sourcing strategies,” she continues. “When compliance criteria are open to interpretation, it becomes difficult to assess supplier equivalency.”

Technologies for securing supply chain

Technologies used in the protection of the small-molecule supply chain include tamper-evident packaging and integrated track-and-trace systems that are connected to such platforms as enterprise resource planning and warehouse management systems, according to Bonde. Additional measures are required for biologics, she stresses, such as IoT-based cold chain monitoring, cloud-connected data loggers and blockchain/distributed ledger technology.

Antares Vision Group Life Science uses serialization, aggregation, and automated machine vision inspection in its operations to ensure a secure supply chain for small molecule drugs. For temperature-sensitive large molecules, the company uses real-time cold chain monitoring and RFID-based tracking for reusable assets.

Regarding packaging technologies, Sinbar is seeing increased interest in thermal imaging-based inspection, which Sinbar says gives verifiable, reportable proof of seal integrity and valuable production performance data.

“For small molecules, supply chain security often relies on scale and future-proofing strategies, such as flow chemistry, enzymatic synthesis, short cycle (including greener) synthesis using breakthrough reactions, and derisking strategies, such as supply base and geographic diversification, along with prioritizing reliable partners over mercurial ones,” says Narsimhan.“For large-scale molecules, backward integration is key: adopting novel synthesis methods alongside traditional synthesis, securing raw material supplies despite the geographic concentration, and—if outsourcing—choosing the right supply partner after due diligence for long-term cooperation, since de-risking is often expensive and switching suppliers carries high costs.”

The increasing role of AI

AI is increasingly being utilized in the pharmaceutical industry for supply chain security including automating quality control processes, tracking changing global regulations, predictive analysis for risk detection, counterfeit identification, optimizing logistics, and anomaly detection. According to Sinbar, Yoran Imaging uses AI for big data analysis, root cause investigation, and predictive maintenance. “AI adoption should continue to expand to improve responsiveness, reduce human error, and support real-time decision making,” Sinbar says.

“However, [AI’s] broader adoption is limited by fragmented datasets, lack of interoperability, and regulatory constraints,” Bonde advises.“When integrated with IoT and RFID, AI can proactively reroute shipments, optimize inventory, and identify threats before they cause disruptions.”

AI offers quicker and more accurate detection of problems within the supply chain ecosystem, according to DiPalo, and can drive predictive analytics for managing found risks. “For example,” offers DiPalo, “Antares Vision Group’s AI-GO platform uses deep learning for precise defect detection and adaptive process control, helping to enhance safety, quality, and efficiency throughout the supply chain.”

“By leveraging supplier management tools, organizations can collect and analyze performance data from each supplier,” says Mokuolu. “Integrating machine learning and artificial intelligence enables deeper insights into supplier reliability and operational trends. These technologies help proactively identify potential risks and disruptions, effectively future proofing the supply chain.”

“Challenges [to AI adoption] include high implementation costs, a shortage of skilled talent, data silos, and regulatory uncertainty,” says Muniyandi. “Even so, AI should play a bigger role. It can dramatically boost resilience, efficiency, and security—critical in a post-COVID world in which supply chains must be faster, smarter, and more adaptable than ever.”

A variety of AI tools have entered the chat. In April 2025, SkyCell partnered with Microsoft to integrate SkyMind, SkyCell’s AI-powered supply chain solution, with Microsoft Teams and Copilot based on Azure OpenAI Service. The collaboration will enable those working in the pharmaceutical supply chain to access real-time shipment data, predictive insights, and automated alerts within a Microsoft system, according to SkyCell (8).

Patients are the focus

The drug supply chain’s many facets allow for multiple avenues for a negative impact on the patients who need medications to live a quality life. Disruptions in the supply chain can stem from such regional problems as natural disasters, quality problems at manufacturing facilities, and political discourse. These disruptions are often out of a drug company’s control. Drug manufacturers should control what they can to minimize these problems by following GMPs and employing the best tools for ensuring quality.

References

1. FDA. Drug Shortages. FDA.gov. March 13, 2025 (accessed Aug. 12, 2025)
2. FDA. Drug Supply Chain Security Act (DSCSA). FDA.gov. Jan. 15, 2025 (accessed Aug. 12, 2025).
3. FDA. FDA Announces New FDA PreCheck Program to Boost US Drug Manufacturing. Press Release. Aug. 7, 2025.
4. EMA. Strengthening Supply Chain of Anti-D Immunoglobulins. Press Release. July 4, 2025.
5. Barton, C. EMA Is Tackling Vulnerabilities in the Supply Chain of Radiopharmaceuticals. PharmTech.com. June 4, 2025.
6. Cole, C. Survey: Impacts of Tariffs and Trade Policy on the Bio/Pharmaceutical Industry. PharmTech.com. Aug. 1, 2025.
7. Cole, C. How Pharma Can Build Resilient Supply Chains Amid Trade and Tariff Shifts. PharmTech.com. July 25, 2025.
8. SkyCell. SkyCell and Microsoft Announce Collaboration to Bring Copilot into Pharma Supply Chains. Press Release. April 7, 2025.

About the author

Susan Haigney is lead editor at Pharmaceutical Technology®.

Article details

Pharmaceutical Technology®
Vol. 49, No. 7
September 2025
Pages: 22–25

Citation

When referring to this article, please cite it as Haigney, S. Keys to Navigating the Complex Drug Supply Chain. Pharmaceutical Technology 2025 49 (7).