According to McKinsey & Company, the value of pharmaceutical products traded in the previous 20 years has increased sixfold, from $113 billion in 2000 to $629 billion in 2019. Market Research firm Statista reported that in 2020, roughly $1.27 trillion was spent on medications.
Every Shipment Is Valuable
Regardless of size or contents, every pharmaceutical shipment is valuable, some to the tune of millions of dollars. If anything goes wrong during the distribution process, manufacturers might have to write off a shipment, which can substantially harm a company’s profitability. But the bottom line of a balance sheet is nothing compared to what else is at stake: people’s health and even lives. The distribution and safety of pharmaceutical products (especially during transport) have a very direct impact on medical outcomes. Therefore, manufacturers, distributors, shippers, logistics service providers, and retailers need deeper levels of insight and greater visibility into the supply chain now more than ever.
Data and Insights
Data collection isn’t new to supply chain management; in fact, many supply chain stakeholders have more data than they know what to do with. But the question is, is it the right data? How reliable is this data? Does this data represent real-time tracking of shipments, or is it delayed information? Is the data easily accessible, readable, and shareable, or is it stuck in a silo somewhere in the deep recesses of the supply chain?
Let’s pause for a moment to consider that data collection is only one part of the story; equally important is that stakeholders know how to use insights gleaned from all this data to drive actionable decisions.
“Poor data control is responsible for significant supply chain issues, given the existing silos, handoff points along the supply chain and potential errors. These issues prevent companies from making their data work for them, in order to create efficiency, improve quality, and reduce costs… Utilising the right information to gain insights enables control, which, in turn, facilitates improvement, and a focus on continual improvement identifies new opportunities.” – Pharma Technology Focus.
Real-Time Data Can Bring Positive Change
In this article, we’ll explore how real-time tracking of pharmaceutical shipments accelerates their distribution. We will examine the common challenges in distribution, including compliance issues, and how real-time data, combined with customised tracking alerts, can empower supply chain leaders to overcome obstacles and realise insights that will drive proactive management decisions.
- The State of the Pharmaceutical Cold Chain
In general, the pharmaceutical industry consists of three different components, each having its own supply chain ecosystem:
- Commercial Products – These are products that require approval from each country where they’re distributed.
- Clinical Products – These are preapproved products in different stages of trials, from Phase One to Phase Three.
- Research and Development Products – These are pre-clinical products currently undergoing testing.
Separate organisations govern the systems and supply chain flows for each ecosystem. But what’s common among them is each ecosystem relies on product availability to meet ongoing demand.