Pharmaceutical Supply Chain: Top Trends in 2024

Dear Supply Chain leaders, we wish you a sound sleep in advance as we solve your worries to optimise the pharmaceutical supply chain. 

Here are the top 7 trends to look out for in 2024 and the following year that will transform the operations. Keep reading to learn more!

Remote monitoring and sensor networks for real-time insights

Since pharma products are vulnerable to temperature fluctuations and other factors, remote monitoring technology is paving the way for transforming the pharmaceutical supply chain. These monitoring systems provide real-time insights on critical parameters like temperature, humidity, and location, assuring the products are delivered in the right conditions. 

The real-time data proves to be invaluable as it allows for the early detection of anomalies. Identifying such issues as soon as possible encourages swift and targeted intervention, such as rerouting the shipment, adjusting the environmental controls within the cargo vehicle, or any other corrective actions. Such a proactive approach helps to minimize the risk of damage to these products and protects investments made in them. 

One such example is the Remote Temperature Monitoring Device (RTMD). This device can be attached to various medical cold chain solutions to monitor internal and external temperatures, lid opening, GPS coordinates, and the battery levels of the cold storage solution it is connected to. 

Blockchain for logistics

Blockchain technology ensures transparency, security, and efficiency when leveraged in pharmaceutical logistics. Every tiny detail can be encrypted and stored safely from when the product leaves the manufacturing unit to when the customer receives it. This makes tracking and quality control of batches more efficient.

This technology owes its advantage to its decentralised nature. As it distributes information across the computer network, it creates an immutable record of every transaction, making data tampering virtually impossible. As a result, the system is transparent and tamper-proof, allowing real-time supervision of the entire supply chain involving all the stakeholders. 

Additionally, the synergy between blockchain and Internet of Things (IoT) devices works at its best to improve the security and efficiency of the system, upholding the highest standards of patient care and safety. 

Artificial intelligence and machine learning

Archie Mayani, the GHX Chief Product Officer, emphasizes leveraging intelligent and dynamic inventory management analytics for backward agility, predicting actual supply chain disruptions and navigating through them. These AI tools can facilitate upstream, value-based care by identifying clinically equivalent products to replace those on backorder.

The cloud-based ERP systems have helped establish centralized, unified data repositories where AI and ML can flourish in the healthcare supply chain. The intelligent tools also help automate non-value-added administrative tasks, saving the supply chain leaders and teams time to focus on the most strategic and creative work to support organizational goals. 

Dream of Drone Delivery comes true!

The COVID-19 pandemic has not only digitalized the world but also made it more efficient. During such a challenging time, India commenced its i-Drone Project, under which the country delivered 900 doses of COVID-19 in remote areas. Though a pilot-scale project, this project has paved the way for the possibility of providing medicines via drones. 

Drones ensure rapid delivery times and minimize the need for manual handling while providing highly reliable and precise delivery solutions. Drones offer traceable and error-free transportation, making them ideal for critical last-mile delivery tasks to remote locations. 

Although this technology still faces challenges, its integration in the pharmaceutical supply chain marks a significant leap forward in improving access to essential healthcare services. 

Mergers and acquisitions

If you follow the news on Pharma Now, you will see the rising trend in mergers and acquisitions events worldwide. This strategic step to advance the business solves the challenges related to scale-up operations. During the M&A activity, the supply chain leaders are tasked with reconciling disparate systems, processes, and data among the merged entities. 

As new entrants like Amazon, Walgreens/Village MD, and CVS/Atena join the healthcare market, delivering care more efficiently and at low prices directly to the patient’s home is possible. The merged entities allow quick and effective transport of healthcare. When a major, multi-state IDN supply chain leader establishes a contract to standardize and drive savings, that decision is operationalized from the procurement point to achieve the intended value.  

Even though such a strategic step allows easy scaling up operations, the supply chain policy must be strictly observed throughout the merging organizations to adhere to the regulatory standards. Implementing cloud-based ERP systems helps digitalise this process. With intelligent tools, you can easily achieve integration and standardization across the board.  

Rise of the ‘Payvider’ Model: Data from insurance companies helps forecast demand better

As the name suggests, this model results from a collab between healthcare providers and insurers that aligns incentives to improve patient outcomes. This model circumvents unnecessary procedures and enhances patient satisfaction. The Payviders improve patient experiences by providing a seamless, coordinated care journey. They gain more direct control over costs, making care more affordable. They can also leverage integrated data to offer personalized treatment. 

Integrated care delivery that ensures continuity of care is its key feature, along with the aligned financial incentives to prioritise patient health and enhanced data sharing to facilitate better management and provide preventive care. Since this model brings a cultural shift from a purely financial perspective to patient-centered care, insurance companies may struggle to function in new territories like patient care, logistics, and facility management, besides managing dual regulatory compliance and increased financial risks. 

This model optimises the healthcare supply chain by improving the demand forecast and inventory management. Access to integrated patient data allows predictive stock management, streamlined procurement, and reduced wastage. It ensures essential supplies are available timely, thereby improving the overall supply chain efficiency. 

 Advanced automation

With the rise in global demand, supply chain leaders face the challenge of deploying their limited working capital. As it is rightly said, “Necessity is the mother of invention”, we expect to see more innovations in process automation.  The consignment order and inventory order, representing up to 60% of the health system’s supply spend, will be the target area for automation in the upcoming year. Besides the cost savings, the other benefits, like reduced clinical labour and enhanced patient safety, are the driving forces that push the innovation in automation. 

What’s more?

The trend of collaboration among trading partners to extend automation from front-end procurement to back-end invoicing and payment will increase in the coming year. 

Final Thoughts

Currently, automation systems, including sensors and AI tools for remote monitoring to optimize the pharmaceutical supply chain, are trending in the Pharma industry. Though the discussion ends here, the trends keep changing with time. Follow Pharma Now to keep track of every trend and stay ahead of the curve.

FAQs

1. What challenges are companies facing in adopting new supply chain technologies?

Pharma companies face challenges like high implementation costs, resistance to change within organizations, the need for employee training, and integration issues with existing systems and processes.

2. How does regulatory compliance impact pharmaceutical supply chain operations?

Regulatory compliance impacts supply chain operations by requiring companies to adhere to stringent guidelines regarding product quality, safety, and traceability, which can add complexity and costs to supply chain management.

3. How are pharmaceutical companies addressing the challenge of counterfeit drugs?

Companies are implementing serialization and track-and-trace systems, leveraging blockchain technology for transparency, and collaborating with regulatory agencies to enhance product security and integrity.

4. How is the trend towards personalised medicine affecting supply chain strategies?

The shift towards personalised medicine requires more flexible and responsive supply chains that can handle smaller, customized batches of products while maintaining efficiency and quality control.

5. What is the impact of mergers and acquisitions on pharmaceutical supply chains?

Mergers and acquisitions can lead to streamlined operations, expanded product portfolios, and enhanced capabilities but also pose challenges related to integration, culture alignment, and regulatory compliance.