Pharmaceutical Supply Network Challenges Continue According to IMS Health Forecast

Based on the recently released IMS Health industry forecast, it looks like the macroeconomic trends driving increased complexity in pharmaceutical manufacturing (both organic and contract manufacturing), supply chain operations and sourcing will continue to grow. The question facing the planning and operations leaders in these areas is how to get ahead of this curve.

According to the new report, the seven "Pharmerging" markets comprised of China, Brazil, India, South Korea, Mexico, Turkey and Russia will contribute more than half of the expected global market growth in 2009. While this share in 2009 is higher than the recent historical average, these seven markets will be the source of more than 40 percent of total global growth through 2013. This trend isn't surprising as these countries are still climbing up the curve of broad access to primary care, particularly in rural areas. Improved health insurance access is stimulating improved health care regimens while the traditional focus on acute care and infectious disease treatment is giving way to a new focus on longer-term care of chronic illnesses such as cardiovascular diseases and diabetes.

As this trend shows no signs of abating anytime soon, the question that has been facing many of our customers is: Do we make tactical adjustments in our manufacturing and supply chain plans or is now the time to look at a strategic change in the way we do business? Markets are becoming increasingly global yet at the same time the specific desires of each country and region are becoming more local. In parallel, the growing emphasis on operational improvement stimulates a desire for global sourcing and global access to contract manufacturing, packaging and distribution partners. This push into a more virtual environment is straining traditional management processes and technologies to the limit.

Is now the time to completely reexamine the foundation that all this operates on?

Contract Pharma 2009 - The Pharma Outsourcing Event Recap

The TraceLink team just returned from this year's Contract Pharma conference and we all agree that it was a stellar event. Interesting and diverse sessions on a range of issues from globalization, pharmaceutical outsourcing and clinical manufacturing were combined with an enthusiastic audience and smooth logistics. This was the second time we have attended and in my opinion, the bang-up job that Gil Roth's Contract Pharma team continues to do is one reason for the great crowd this year.

While I really cannot do the speakers justice in representing their sessions, a few comments did jump out at me:

• Mac Lynch (VP, Contract Manufacturing, Pfizer Global Manufacturing) highlighted several expected benefits of outsourcing that revolved around the general theme of agility in the face of uncertainty. This has been a recurring theme in many of our customer discussions. Namely, as therapies get more targeted and markets get more diversified, it becomes even more imperative to create network flexibility, manage demand volatility and address new product uncertainty in a capital-efficient manner.
• Rachael Zuckerman (Research Analyst, Tufts Center for the Study of Drug Development) talked about the explosion of contract clinical services. The number of companies actively managing clinical projects more than doubled in recent years to over 2,300 in 2008 according to Rachael's research. Combined with the growing globalization of clinical trials (32% of all CTs in 2007), this has been putting pressure on sponsors to find ways to effectively manage these far-flung operations. Rachael's research also highlighted how a focus on accountability can improve the contracting process. Driving visibility into operations and creating insight through knowledge management promotes the ability to optimize new contracts and reduce the number of contract changes.
• Deirdre Ogorzalek (Celgene Corp.) discussed how important it is to understand the team culture and process working style of your contract partner. While the going-in position of a sponsor may be to outline a specific working model for its partner, the reality is that the day-to-day working style and communication methods will greatly impact how a project is ultimately executed. So, creating bi-directionally open communications between the project teams on both sides is crucial in delivering a project that meet outlined KPIs and SLA metrics.

ContractPhama makes the presentations delivered at the event available to anybody via a simple registration process. This is a refreshing approach compared to the fees that other events will change for event proceedings. I urge anyone who wants to gain a 360-degree view of the current environment to check them out!

Subscribe

Have our blog sent to your inbox!

Delivered by FeedBurner