Improving A Supply Chain Management In Pharma Industry

Improving the supply chain performance

moldovan vasilie , MD

mail : moldovan@artelecom.net

Table of Contents

Abstract ..............................................................................................................3

Short description of the company .......................................................................4

Characteristics of the supply chain and logistics in pharma.................................5

Downstream supply chain in pharmaceuticals ..................................................7

Particularities of SCM in pharmaceutical field ................................................8

Supply to stock and Supply to order method .....................................................9

Performance measuring of indicators SCM .Considerations .............................13

Solutions to improve effectiveness in various processes of the SCM ................13

Pharmaceutical warehouse .Warehouse management ......................................15

Continue improvement in SCM .Collaborative Planning System.......................16

Conclusions ........................................................................................................18

ANNEX ..............................................................................................................20

References ...........................................................................................................25

Abstract

Supply Chain Management is one of the most complex business disciplines, comparing the interactions within and between many of the traditional functional areas of a company and their channel partners. Long-term success is becoming increasingly dependent on action and decision of upstream and downstream firms in the supply chain. (Darke and Mawhiney, 2006)

Probably the most recommended definition of supply chain management is the one developed and used by the Global Chain Forum in 1998: “Supply Chain Management is the integration of the key business processes from end user through original suppliers that provides products, services, and information that add value for customers and other stakeholders”. (Lambert et al.1998).

Figure: Hierarchy of Objectives

Because of the fact that this material refers to a drug producer, a definition that is close to the actual meaning of supply chain management is the following: the integration of all activities in a cycle that starts from raw material acquisition, followed by its transformation into finite drug, its distribution and its use by the sick patient вЂ" client. Of course, such a cycle includes information transfer between the members of such a network, the technical and scientific improvisations brought to the SCM in order to fulfill its purpose of reaching a sustained competitive advantage with respect to other players and competitors from the more and more globalized market. (Handfield and Nicholas 1999) Everywhere, the regulators are asking the pharmaceuticals industry to find appropriate solutions to ensure that our supply chain is safe, effective and affordable.

The aim of this paper is to analyze and support the changes of the supply chain management and logistics in the factory, from a theoretical point of view, starting from these premises. These changes are required by the introduction of new technologies and the automation of production, by the introduction of a last generation information management system (IT SCALA), by a new HR policy, by a newly emerged general management вЂ" all these being connected to the change of the owner of the stocks of the drug factory during 2005.

Short description of the company

The Romanian company, the most important platform for producing sterile infusible drugs (infusible solutions), was purchased by the Italian pharmaceutical-chemical group, ACS Dobfar, in 2005, through direct negotiation, as result of a financial transaction of more than 4 million euros. The factory had to undergo a complete technological renewal, everything being disaffected, and during 2005 a new administrative office and a completely automated new factory have been built. The entire technological flow was GMP, GLP and ISO certified, such that in 2006, Infomed Fluids was the only producer on this niche, which was completely certified by the pharmaceutical authorities. The renewal of technology, the general management change, the introduction of a new modern informational system (SCALA) required a complete reconfiguration of the management of each department of the organization, including the logistics and supply chain departments, directly involved in ensuring market/customer satisfaction, and also in ensuring the competitive advantage of the factory with respect to other niche players and in creating added value to the investment of the stockholders.

The company went through two implementation phases of the logistics and supply chain management, which will be described in this study, the changes being accomplished gradually, depending on the implementation of other management processing and on the technological and informational investments. The location of the factory вЂ" in the capital of the country, Bucharest, a city with almost 3 million inhabitants (almost 15% of the entire population of the country), a city with almost 50 hospitals (near 28% from the total number of hospital beds are located here), a city in which the use of drugs has represented almost 36% of the entire use of drugs of Romania in 2006 вЂ" is ideal from the business strategy perspective. For the details see the ANNEX 1, SWOT Analysis.

Characteristics of the supply chain and logistics