The pharma industry is among the fastest-growing sectors in India and is expected to grow at a CAGR of over 10% to reach a size of $130 billion by 2030. Amid this growth, it’s vital for pharma companies to keep abreast of technological advancements, especially digitalization, in order to achieve long-term success.
This article explores the transformative role of digitalization in pharmaceutical supply chain management, offering valuable insights on how enterprises can leverage its benefits. Essentially, managing temperature-controlled products, navigating regulatory requirements, mitigating risks, and ensuring the delivery of life-saving drugs are crucial aspects of supply chain management.
However, the complex network of multiple entities in supply chains, from raw material providers to distributors, makes managing supply chains a daunting task. At the same time, pharmaceutical companies deal with sensitive and confidential information, including patient data and proprietary formulations. Ensuring the security and privacy of this data is significant for companies. With so much at stake, disruptions in pharma supply chains can have devastating outcomes.
Traditionally, these supply chains have relied on manual, paper-based processes that are increasingly difficult to scale and optimize. In such a scenario, digitalization turns out to be a savior for pharma companies. By providing complete supply chain visibility, digitalization empowers organizations to manage and monitor each step closely.
The Complex World of Pharmaceutical Supply Chains
Unlike many other industries, pharmaceutical supply chains are uniquely complex and highly regulated, due to which they face significant challenges in today’s healthcare environment. Meeting the increasing global demand for medicines and ensuring patient access to critical therapies is no small task.
Complex Production and Distribution
Producing and distributing pharmaceuticals is an intricate process with many regulations and requirements to follow. Raw materials, manufacturing, packaging, storage, and transportation must all meet strict standards to guarantee safety, efficacy, and quality. Coordinating this complex network, including the MRO procurement cycle, requires advanced planning and oversight.
Rising Cost Pressures
Rising costs for healthcare and medicines put pressure on pharmaceutical companies to reduce expenses while still generating value. Organizations need to continuously optimize their supply chain practices in a way that does not compromise patient care.
Lack of Risk Visibility
Maintaining visibility into pharmaceutical supply chain processes is indeed difficult. Lack of transparency about contract manufacturers’ procedures, stock levels, and quality assurance procedures, for instance, can result in delays and quality problems that affect the entire supply chain.
Demand Fluctuations
The demand for pharmaceuticals can fluctuate significantly, especially during health crises like pandemics. Supply chains must be agile enough to respond to these changes quickly.
Offshoring
Offshoring often involves shipping raw materials and finished products over long distances. This can lead to transportation bottlenecks, increased lead times, and vulnerability to disruptions such as port closures or natural disasters.
Poor Collaboration
The pharmaceutical industry has a vast ecosystem of stakeholders, including drug manufacturers, contract manufacturers, suppliers, distributors, healthcare providers, and others. This complex network often makes collaboration a challenging task. As a result, organizations often suffer from process delays and supply chain disruptions.
Addressing Pharma Supply Chain Challenges with Digitalization
Given these challenges, it’s evident that pharmaceutical supply chains need to evolve to meet the demands of the modern healthcare landscape. Supply chain digitalization is the key to achieving this evolution. Digital transformation solutions like supply chain management software can overcome many of these hurdles, as follows:
Improved Visibility
Modern-day supply chain solutions utilize technologies like cloud computing, big data analytics, and the Internet of Things (IoT) to give pharma companies end-to-end visibility into their supply chain. They can track products and shipments in real time, predict delays, and gain insights to optimize operations. This visibility results in reduced costs, minimized risks, and improved customer service.
Enhanced Security
With digital supply chain solutions powered by blockchain technology, companies can document each step in the supply chain, including raw material sourcing to delivery, giving pharma companies and consumers transparency. This mitigates the security risks by consolidating records.
Optimized Efficiency
Digital procurement solutions are equipped with AI and machine learning technologies that help companies analyze huge amounts of data to detect patterns and insights for improving efficiency. They can forecast demand, optimize inventory levels, streamline logistics, minimize waste, and reduce costs.
Apart from the above benefits, when pharma companies choose digital supply chain solutions from companies like Moglix Business, they make their supply chains more flexible, responsive, and adaptive. For instance, these solutions help pharma companies switch to an integrated platform that helps them gain real-time visibility into inventory, demand, and supplier performance. Here’s how their solutions have helped a leading healthcare organization consolidate a fragmented supplier base and enable 100% tax compliance. They have helped the organization navigate business challenges, including dealing with multiple vendors, unorganised data and non-standardized pricing.