Distribution and logistics partnerships critical for healthcare companies

Pieter Kinds

Pieter Kinds

January 5, 2016 - 14:35

The eighth UPS Pain in the (Supply) Chain survey (2015) has revealed that healthcare companies made significant strides within just one year to address some top supply chain issues...

Key findings of the Pain in the Chain survey are as following:

  • 75% of respondents reported success addressing product security vs 55% in 2014
  • 70% of respondents reported success in addressing regulatory compliance vs 57% in 2014
  • Physical protection from theft (46%) and poor supply chain visibility and too many supply chain hand-offs (40%) represented the biggest product security challenges
  • Contingency planning is not prioritized by healthcare executives
  • Partnerships are the top successful strategy healthcare companies use to address regulatory compliance, product damage/spoilage and cost management

The survey proves that many healthcare companies have made great progress in product security and adapting to regulatory changes. "What we find most interesting from this year's survey results are the strides that healthcare companies have made in just one year to address some top issues that have faced the healthcare supply chain for decades, and we are pleased to share the strategies that firms are leveraging," said Robin Hooker, UPS Director of Healthcare Marketing.

Remaining issues healthcare supply chain

The results show that just 50% of respondents indicated success addressing supply chain cost management. The top challenge to managing costs is rapid business growth, cited by 56%. In order to address this, healthcare logisticians see the most opportunity in optimizing their transportation costs and gaining better inventory visibility.

"We see pharmaceutical companies becoming more optimistic regarding product security as they implement anti-counterfeiting initiatives as part of the U.S. Drug Supply Chain Security Act, which is a broad-based supply chain security and recall mandate," Hooker said. "The real question is how quickly will forward-looking firms reap additional business value related to inventory management by investing in systems that are not only compliant to DSCSA, but leverage the datasets for supply chain optimization."

Hooker also added: "The analytics and predictive power of managing inventories and logistics flows with knowledge of potential expiry dates at the unit level enables a new level of inventory control and potential savings in expired pharma return/audit/destruction cost."

The eighth UPS Pain in the Chain survey was conducted by TNS between April and June 2015. A total of 421 interviews of healthcare logistics executives were carried out in 16 countries. Fifteen separate, qualitative interviews were conducted in North America to gain further insights into trends, challenges, and opportunities impacting healthcare logistics. Click here to access the 'Eighth UPS® Pain in the Chain Survey' snapshots:

Eighth UPS Pain in the Chain Survey Snapshot (2015)