MHI Solutions

Industry Trends

INDUSTRY FOCUS: Pharmaceutical

More products, more customization, more regulatory scrutiny and more public outcry over price increases. That’s where pharmaceutical manufacturers find themselves in 2018.

* By Sandy Smith *

There are early indicators of what the pharmaceutical industry may hold in the near future—and the impact on supply chains is at the forefront.

“The biggest challenge facing pharmaceutical manufacturers is the stringent requirement of traceability of their manufactured products,” said Rupesh Narkar, director of sales – production intralogistics for MHI member Swisslog Logistics Inc. “Most of the pharmaceutical manufacturers look for traceability that offers them complete tracking of the product from manufacturing through warehousing, up to dispatch.”

Much of that is driven by regulations as part of the multiphase implementation of the Food and Drug Administration’s (FDA) Drug Supply Chain Security Act (DSCSA). Logistics providers, including 3PLs and wholesale distributors, were the first to be impacted. In 2014, they began reporting to the FDA. They also will be facing licensure standards to be in place by the time the act is fully implemented in 2023.

This fall, another phase takes effect, requiring serialization of products. Over the next few years, products will be traced down to the package level.

Fighting against counterfeit drugs is just the first step that the FDA hopes to solve with DSCSA. In a February public meeting, FDA’s Commissioner of Food and Drugs Dr. Scott Gottleib said that once the supply chain is fully digitized, it can help develop “predictive analytics to reduce healthcare fraud, waste and abuse. It can allow regulated industry and regulators to more easily manage or avoid costly or dangerous supply disruptions. It can help support innovative manufacturing and distribution technologies at a time when the drugs being developed are becoming increasingly tailored to specific patient populations.”

Later this fall, the FDA will issue guidance in standardizing the data contained in product tracing information that trading partners must provide.

In Europe, a new requirement to prevent counterfeiting—the Falsified Medicine Directive—takes effect in February. It requires most medicine packs to have a 2D serial code and a tamper-prevention feature.

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Leading manufacturing and supply chain executives agree that technology is the key to future success. As they digitize their supply chains they are generating more data than ever before, giving them the power to leverage that data to see their businesses in new ways and to make better decisions. These early adopters are creating real and measurable competitive advantage. When it comes to technology investment start small but think big. Build on your successes and learn from your failures. By investing wisely, you’ll create additional value in your supply chain and widen your advantage over the competition.

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