Pharma Digitization Is Underway: Don’t Get Left Behind
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2017 will be the year we see supply chain digitization take off at hyper speed. While it’s been occurring over the past few years, the need for speed is important for those businesses facing profit and costs challenges. For pharmaceutical businesses, the industry is faced with not only profit and cost challenges but many other challenges including globalization, complex supply chains, increasing regulations, counterfeits, personal medicine and more. As such, the benefits of digitization can help the pharmaceutical industry to adapt in a more efficient manner.
Digitization – What is it?
For the purposes of this article, we’ll look at supply chain digitization. So, what is it exactly? According to Christian Lanng, CEO of Tradeshift, supply chain digitization means moving all aspects of a supply chain online, including procurement, invoicing, approval cycles and payment procedures. Ideally, as Mr. Lanng points out, supply chain functions should be accessible via cloud because this allows employees to collaborate, manage and procure from anywhere at any time.
The Benefits
Several management consulting firms have noted that the pharmaceutical industry has been too cautious in apply digital technology to improving manufacturing and supply chain operations thus far. PwC has written that by applying digital technology, companies can increase visibility into their supply chain operations and make better and faster decisions. Furthermore, digitization also makes companies more adaptive and responsive and as a result, planning accuracy, manufacturing efficiency and productivity, inventory levels and service levels improve.
Accenture put some estimates around the benefits of digitization for the pharmaceutical industry. According to its report, if businesses do not incorporate digitization into its strategy, 11% of the company’s profitability is at risk; however, implementation of such measures could boost profitability by as much as 27% and for fast movers, profitability could be boosted by as much as 61%.
How are pharmaceutical companies progressing? Take a look below at just a sample of what some companies are doing.
· Novartis – In 2015, Novartis introduced its Trials of the Future program and Qualcomm’s subsidiary, Qualcomm Life, Inc., as a partner, to optimize global clinical trials. According to the press release, the program is designed to leverage health care technology to improve the experience of clinical trial participants and patients using Novartis products, and provide connectivity with future products marketed by Novartis. Novartis expanded its relationship with Qualcomm Ventures to invest Novartis up to $100 million to invest in "technologies, products or services that 'go beyond the pill' to benefit physicians and patients".
· AstraZeneca - Partnered with Anthem to use data analytics to find the most cost effective treatments for many chronic and common diseases. The company also has partnered with Vodafone to develop mobile health services for cardiovascular patients. The partners will create mobile and internet-based services to support patients on medication adherence and self-management.
· GlaxoSmithKline (GSK) – Among its many initiatives, the company is reported to have transformed its direct business-to-business purchasing system in it’s US system with multi-device access. In 2015, Siemens became GSK’s preferred automation supplier for production and R&D sites worldwide, including vaccines. The partnership centers on process control, as well as equipment control and building management systems within the manufacturing and R&D pilot plants of GSK.
The Outlook
Don’t get left behind. Digitization is underway in the pharmaceutical industry but more is needed including more emphasis on the handling and management of temperature-controlled products from manufacturing all the way to the final customer. Pharmaceutical companies need to work with as well as partner with logistics and transportation providers to make this happen.
