CSCMP's Supply Chain Quarterly
December 15, 2017
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Managing trade-offs vexes pharma supply chain chiefs

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Respondents to a recent pharmaceutical industry survey cited the difficulty of juggling cost, service, and regulatory compliance as their greatest challenge.

What is the greatest challenge for supply chain executives in the pharmaceutical industry? According to respondents to a recent survey, it's balancing the trade-offs between cost, service, and regulatory compliance. That was the number one concern for nearly one-third (32 percent) of the more than 200 participants taking part in the latest Life Sciences Supply Chain Benchmarking Survey conducted by Worldwide Business research, organizer of the annual LogiPharma conference. The number two challenge was risk management, cited by 30 percent of the respondents. That was closely followed by regulatory compliance, with 29 percent.

More than half (59 percent) of the life sciences executives surveyed said that their companies employed a traditional supply chain structure organized around planning, sourcing, and logistics. Another 22 percent said their supply chain was structured to address specific business segments, while 11 percent were set up as hybrid organizations. Another 8 percent were structured around insourcing vs. outsourcing. When asked about the ideal supply chain structure, almost half of respondents—49 percent—said it should be tailored to specific business segments.

The survey also found that most companies still lack end-to-end supply chain visibility. Fifty-eight percent of respondents said they don't have such visibility or the capability to manage exceptions as they occur. Another 22 percent had end-to-end visibility but lacked the capability to conduct the kind of analysis needed to understand trade-offs when exceptions to plan occur. Only 19 percent said they had both the necessary visibility and the capability to conduct an impact analysis triggered by automated notification, which allowed them to take immediate corrective action.

The report can be downloaded here.

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