Emerging markets and patent cliffs create supply chain management issues for pharma, white paper warns

A new white paper commissioned by logistics company DHL warns that global life sciences and health care companies must re-evaluate and revolutionize their approach to their supply chain management in order to “survive the unprecedented myriad of challenges threatening major disruption to the industry.”

The paper identifies key trends which could derail the industry’s logistics such as emerging market growth, regulatory and compliance requirements, changing product characteristics, and counterfeit drug trafficking. It adds that shrinking margins, escalating cost pressures and growing consumerism are transforming the business paradigm, and concludes: “What is emerging is a business model that looks and acts like the consumer goods industry, where the customer – not the manufacturer – holds the power.”

Lisa Harrington, president of the lharrington group LLC, prepared the report in collaboration with DHL to identify the challenges and developments affecting the sector globally. She said: “The life sciences and health care (LSH) sector finds itself in the position of needing to rethink its entire economic model, and find ways to reduce costs across the board, in order to maintain share in a marketplace that is no longer willing, or able, to fund previous pricing. The old LSH supply chain model is no longer fit for purpose. The new LSH environment requires a more resilient, adaptive supply chain model that delivers robust global management capabilities, reduces costs and hard-wires the agility, flexibility and resiliency needed to support the challenges of global health.”