Pharma supply chain focuses on improving infrastructure and refining services

As the global demand for total pharmaceutical supply chain integrity gets intense, logistics service providers are building up infrastructure and refining services to match up to the best global distribution practices.

Reji John

At least 25 percent of the vaccines go waste even before reaching the doctors and patients while many lose their efficacy by the time they are administered due to lack of quality supply chain and logistics management system.

Poor or lack of adequate systems in supply chain is the biggest cause of wastage in perishables. In the case of pharmaceutical products, they just lose the efficacy.

According to the Immunisation Technical Support Unit (ITSU), under the health ministry, the wastage differs for each vaccine, but the supply of vaccines is computed by 25 percent wastage rate for all vaccines except BCG which records the maximum wastage of over 50 percent. The wastage rate also varies across states depending on infrastructure and cold storage capacity. The ITSU assessment has also been verified by various other agencies, including the World Health Organisation, advocating better supply chain and cold storage management.

To address the issue, India’s health ministry is now taking its immunisation drive a step further to add more cold chains and better manage the supply chain. Under its universal immunisation programme, the world's largest vaccination drive -the ministry has planned over 27,000 cold chain points for storing and distributing vaccines.

Besides, the ministry is also planning to strengthen the system by rolling out a real time electronic vaccine intelligence network which will enable vaccine stock management and monitoring of cold chain temperature using mobile technology.

With the regulatory compliance becoming mandatory for all stakeholders in the global supply chain of pharmaceutical products, there is an overhaul of the current distribution practices to evolve into a global standard.

The pharmaceutical industry utilises logistic services for the complete administration of the distribution of medicinal products and devices to different end users where they are required. These logistics services help the pharmaceutical companies have a continuous supply of drugs, devices and equipment from suppliers and distributors of various locations.

The primary driving factor for the growth of this market include strict regulations in the form of Good Manufacturing Practices (GMP) and Good Distribution Practices (GDP). In addition, factors like increasing demand for temperature sensitive pharmaceutical products, new delivery methods and growing demand for logistics outsourcing services could contribute to the growth of this market.

In pharmaceuticals, added product specialisation and sensitivity means they are more often being shipped globally to reach their markets. Logistics practices must comply with each country's regulations and maintain the strictest requirements, driving many drug makers to raise practices across their supply chain.

Pharmaceutical manufacturers, too, are dealing with more sensitive products, such as customised treatments for rare diseases. These products often include more high-value active ingredients that offer shorter shelf lives and carry strict temperature requirements.

Global pharmaceutical sales are forecast to reach $1.3 trillion in a couple of years. It is estimated that export of pharmaceutical products from India is likely to cross $14 billion mark this year and may reach about $20 billion by 2020, thereby registering a compounded annual growth rate (CAGR) of about 8 percent, according to an ASSOCHAM-TechSci Research joint study.

However, growth in pharmaceutical products' exports from India may decline by almost half i.e. from the level of CAGR of about 15 per cent clocked during 2010-14 to about eight per cent during 2015-2020 on account of delay in regulatory approvals in top markets of the US, Russia, Africa and others, highlighted the study titled 'IPR in pharmaceuticals: Balancing, innovation and access,' jointly conducted by ASSOCHAM and TechSci Research.

For India to take real advantage of the export potential from pharmaceutical products is to significantly improve the supply chain.

Emerging markets present new opportunities for pharmaceuticals exporters. But the increased volumes of shipments and the growing diversity of their destinations, demand enhancements to cold chain infrastructure, services, and technologies.

However, responding to customers demands, global logistics service providers (LSPs) are increasing their focus on specific infrastructure development required to handle pharma export from India either by air or by sea. These LSPs are refining their pharma products and services to comply with GDP standards.

Three years ago, Agility became the first company in India to set up a Pharmaceuticals Competence Centre (PCC) in Nhava Sheva, Mumbai to offer a wide range of logistics and warehousing services. Their solutions were tailor-made to manage pharmaceutical shippers’ temperature-sensitive pharma and life sciences products at competitive prices.

From warehousing and distribution to sorting and kitting, the Agility Pharmaceuticals Competence Centre offers pharma manufacturers more value with Agility’s supply chain consolidation services. Agility offered a GDP-certified, FDA-approved, customs-bonded facility with 3,000 square feet of optimal storage capacity. End-to-end services from collection of temperature sensitive shipments in reefer vehicles to final delivery. Agility’s proposition to its clients was: “Your job is to save lives. Let Agility overcome your complex supply chain challenges.” The centre is supervised by a qualified pharmacist.

For any global pharmaceutical company with a wide base of contract manufacturers (CMOs) in India there are multiple challenges sending its finished products from India to Europe under cold chain compliant conditions. One of the biggest problems was the lack of GDP compliant facilities and equipment. It is here that Agility’s Pharmaceuticals Competence Centre brings the right set of solutions.

At the Nhava Sheva facility, Agility manages and oversees customers’ supply of products from point-of-order to delivery. The shipments are collected and transported using LCL consolidated ocean freight service before they are de-consolidated in Europe for final distribution. The fully GDP certified facility in India is also customs bonded in accordance with local tax legislation.

Given the global reach of clinical studies, streamlined logistics are an increasingly important component of successful trials. UPS is well-poised to serve this expanding market, with capabilities that cover many geographies.

“As innovation in the biopharma industry evolves — and with the emergence of personalized therapies and growing direct-to-patient trends — research and development activity will only increase around the world. Our cost-effective portfolio streamlines logistics for clinical trials into one global network across sometimes remote, hard-to-reach locations,” said Habib N’Konou, UPS senior operations director for clinical trials.

UPS mitigates risks by employing world-class air freight and small package solutions for Investigational Medicinal Products, specimen kits, ancillary supplies, and medical devices to and from investigator sites, contract research organisations, and diagnostic centers. Its customs brokerage team whelps shippers navigate international regulations and avoid costly delays.

“Optimised logistics is an integral component of medical research and development, and our goal is to help clinical investigators reach any part of the world with maximum efficiency. We will continue to invest in the right global solutions with the aim of becoming the leader in biological specimen transportation," said Geoff Light, UPS vice president of global healthcare strategy.

DHL Global Forwarding recently announced that it will work with the International Air Transport Association (IATA) to implement IATA’s CEIV Pharma Certification across its key facilities globally.

David Bang, Global head of DHL Temperature Management Solutions, DHL Global Forwarding, said: “The IATA CEIV certification is yet another initiative within part of our continuous improvement activities to ensure our specialised and compliant network is up to the latest quality standard that recommends DHL as the right partner to the life sciences and healthcare sector.”

The first phase of the CEIV Pharma certification will include 30 key DHL Air Thermonet GDP Compliant stations worldwide. The assessments are expected to start in the third quarter of 2016.