Navigation Links
IBM Study Reveals Drug Companies Struggle to Improve Supply Chain to Battle Counterfeiting, Safety Concerns and Global Complexity

ARMONK, N.Y., Sept. 9 /PRNewswire-FirstCall/ -- Reducing the risk of counterfeit drugs and contaminated medications amidst the complexity of global manufacturing are among the top concerns of the pharmaceutical and life sciences industries today, according to a new IBM (NYSE: IBM) study. More than 50 percent of executives polled say their companies fail to respond quickly enough to pandemics and other emergencies because of lapses in their supply chain.

(Logo: )

The study surveyed executives at pharmaceutical, biotechnology, medical device and consumer health care industry companies who are responsible for planning, logistics, procurement and coordination throughout the life of a drug or medical device.

Companies must work to improve their ability to keep wholesalers, hospitals and pharmacies stocked with the products they need to meet patient demand. Tracking every step of how drugs are manufactured and distributed are key priorities for more than 70 percent of companies. And while the industry is far ahead of most others when it comes to supply chain planning with suppliers, the study indicates the industry falls far behind on collaborating with customers on demand planning, forecasting and replenishment. These are all critical steps to rapidly responding with new vaccines in the event of pandemics, and to ensure that demand does not outstrip supply.

Other key findings:

  • 64 percent reported rising customer demands such as requests for designer drugs or specialized packaging as a major challenge
  • Monitoring risk to prevent counterfeiting, drug and device recalls, or even the loss of intellectual property, is a priority for 75 percent of executives, as margins become slimmer and supply chain complexity rises. Three-quarters have risk and performance initiatives such as surveillance programs, anti-tamper devices and specialized labeling, but with mixed results.
  • 46 percent consider vendor-managed inventory for their customers extremely effective but only 4 percent use it to ensure they are precisely meeting customer demands for products
  • 65 percent collaborate with suppliers on demand planning but only 31 percent do so with customers, often resulting in an overstock of supplies or missed sales targets

Compared to 18 other key industries, the life sciences business is one of the most highly globalized, particularly in the area of Research and Development. From a supply chain perspective, the industry is not as advanced. In general, global sourcing brings with it challenges including daunting capacity, quality, lead times and delivery issues. For the life sciences industry, seventy-six percent of respondents suffer quality issues linked to global sourcing while nearly fifty percent reported increased sales from their globalization efforts due to the growing population of consumers in rapidly developing markets.

More pharmaceutical companies are selling drugs, devices, therapies and services supplied by different partners. They are also serving smaller patient segments, rather than relying on major new drug discoveries that drive revenue over many years. The IBM study underscores the fact that drug manufacturer supply chains need to be more interconnected and intelligent, equipped with sensors and smart devices that share data so they can rapidly change their business models to address new market opportunities.

"As the industry faces a time of transition, supply chain executives are outsourcing more business processes, turning to emerging markets and becoming more globally integrated, all while actively managing risk," said Dr. Philippe Cini, IBM Global Business Services, Life Sciences Supply Chain Management Partner. "The companies we spoke with said they are looking to a different kind of supply chain - one that gives the insight to react instantly to risks or threats, is much smarter and able to provide them the insight and agility necessary to compete in a changing marketplace."

Counterfeiting is one of the biggest risks facing the pharmaceutical industry today. According to the World Health Organization, approximately 10 percent of the worldwide drug supply is counterfeit. To combat such risks, sophisticated simulations and data models help companies calculate risk, and building intelligence into products and packaging such as barcodes, RFID tags and other smart devices, supply chain executives can prevent theft. This type of new intelligence along with e-pedigree and track-and-trace capabilities also enables the entire supply chain to respond quickly in the event of a recall.

Using smarter, more intelligent supply chain systems that connect suppliers, manufacturers, distribution and customers can more effectively allocate inventory around the world, making real-time adjustments in production and distribution and avoiding costly stockpiles. With the help of sensors and other smart devices to communicate and share information, new efficiencies can be attained. For example, smart pallets of flu medication can sense what and how much medication they are carrying, monitor proper levels of refrigeration and storage, and automatically send a signal when the pallet needs to be replenished.

A smarter supply chain helps drug companies capitalize on revenue opportunities in emerging markets while more advanced customer insight allows firms to tailor their products and create new drugs, devices and even diagnostic tools to expand their business.

The study -- "The Smarter Supply Chain of the Future: Life Sciences Edition" -- was developed by IBM Global Business Services' Supply Chain Management Practice in conjunction with the IBM Institute for Business Value, which develops fact-based strategic insights for senior business executives.

IBM will host a webinar featuring AMR Research, Smarter Medicine: The Smarter Supply Chain of the Future, on September 10 that will provide insight about how Smarter Supply Chain Management can drive innovation into the health care and life sciences industries.

To register, please visit:

About IBM

For more information please visit

CONTACT: Holli Haswell, +1-512-590-8879,

Copyright©2009 PR Newswire.
All rights reserved

Related medicine news :

1. Peter G. Peterson Foundation Releases The Lewin Group Study Showing Current House Health Care Reform Proposal Would Lead to Expanded Coverage and Higher Costs
2. Nicotine Plays Tricks on Brain: Study
3. Study reveals new role of vitamin C in skin protection
4. Major clinical study rejects cancer safety fears of most common heartburn treatment
5. Regado Biosciences Announces First Patient Enrolled in RADAR (Phase 2b) Study of REG1 Anticoagulation System
6. Study: Hairstylists can help identify older clients who need health services
7. Trial Lawyer TV Ads for Medical Malpractice Lawsuits Grew 1,400 Percent in Last Four Years, Study Shows
8. Newly Published Clinical Study Finds New Commercial Diet Program Superior to Standard Protocol for Diabetes Weight Loss and Blood Sugar Control
9. Colon Cancer Screenings Still Too Low: Study
10. Medical Student Wins Travel Scholarship to Kenya to Study Operative Care in Africa
11. Single Parents May Do as Well as Two: Study
Post Your Comments:
(Date:11/26/2015)... ... November 26, 2015 , ... ... to discuss bioavailability and the need to integrate dose form selection in early ... with OBN, the membership organization supporting and bringing together the UK’s emerging life ...
(Date:11/26/2015)... ... November 26, 2015 , ... Pixel ... self-animating trailer titles with ProTrailer: Vintage. This newly styled ProTrailer pack comes with ... work with any font, giving users limitless opportunities to stylize and create designs ...
(Date:11/25/2015)... , ... November 25, 2015 , ... ... for all, Water For Empowerment ™ attracts volunteers together who want to ... by empowering women as key stakeholders in the process. The non-profit launched its ...
(Date:11/25/2015)... ... November 25, 2015 , ... TyloHelo Inc , North ... , Sauna accessories help improve the bather experience in the sauna, and the ... for the purist looking for simplicity in design to accessories that encourage a ...
(Date:11/25/2015)... ... ... For the first time, Vitalalert is donating half of its earnings to ... between the two groups began in 2014 with Vitalalert pledging a portion of every ... founded in 1954 and is an international Christian-based health organization whose mission is to ...
Breaking Medicine News(10 mins):
(Date:11/27/2015)... , Nov. 27, 2015 Research and ... the "Global Intrauterine Devices Market 2015-2019" report ... --> In this report, the author the ... devices market for 2015-2019. To calculate the market size, ... following type of products: Hormonal IUDs and copper IUDs. ...
(Date:11/27/2015)... , Nov. 26, 2015 ... addition of the "2016 Global Tumor ... Country Volume and Sales Segment Forecasts, Innovative ... report to their offering. --> ... of the "2016 Global Tumor Marker ...
(Date:11/26/2015)... , November 27, 2015 /PRNewswire/ ... --> Medical ... response system (PERS) market is ... 5 years with APAC being ... to see a high CAGR ...
Breaking Medicine Technology: