Complexity and change mark the landscape of the pharmaceutical industry. In an environment of major challenges ranging from rising drug discovery costs, increasing government regulations, drugs coming off patent, and increased demand from emerging markets, pharmaceutical companies must find efficiencies within their operations. With the increase of mergers and acquisitions in the industry, there is an urgent need for companies with disparate systems to find a way to harmonize processes and information collection.
- The supply chain and management of supplier information is at the epicenter of these business improvements as pressure increases to keep costs down while adhering to a variety of new compliance standards and regulations.
- With big drugs coming off patent and cheaper generics entering the market, cost savings and the push toward low-cost country sourcing are increasingly key to protecting the bottom-line.
- As companies move their own manufacturing (and that of their suppliers) to China and India, the increased use of low-cost markets have organizations scrambling to manage this new supply base effectively, from identification and enablement to risk and performance scorecarding.
- Navigating and managing the regulatory and compliance landscape is business critical: stringent compliance standards and mandates, whether FCPA, FDA, HIPPA, 21 CFR Part 11, SOX, GMP, HS&E, waste management, or corporate social responsibility, require heavy involvement and oversight by Procurement and stakeholders alike.
- With new pharmacy-specific regulations such as the Physicians Payment Sunshine Act, organizations need to mobilize quickly to avoid significant fines and penalties.
Current systems are often not capable of handling the breadth of these compliance areas. Internal resources are forced to chase data across multiple disparate systems in an attempt to patch together information, thus driving compliance initiatives manually.
The Pharmaceutical Supply Chain Initiative (PSCI) was established to address areas of responsible business practices, including ethics, labor, animal welfare, health and safety, environment, and management; and standardize “The Principles” across the industry. As mitigating reputational risk is paramount in today’s competitive environment, many pharmaceutical manufacturers are making these standards a bare minimum – and the burden to manage this risk has fallen on Procurement.
While driving cost savings, from supplier and operational perspectives, and mitigating supplier, compliance, and reputational risk, supply chain executives strive to increase visibility and value within the supply base. As suppliers can offer strategic advantages, organizations are looking toward monitoring the performance of suppliers, and the continued development of supplier capabilities, innovation, and performance, for increased competitiveness. Lack of this visibility is critical in several areas, such as the outsourcing of warehousing and distribution. In many instances where the necessary quality audits and performance reviews did not occur, the result of an incompliant supplier – such as the wrong temperature during transport or storage – led to a significant loss in revenues.
The pharmaceutical supply chain of the future will be built around flexibility, responsiveness and reliability, shifting the focus toward intelligent supplier information management systems. HICX understands the supplier management demands pharmaceutical companies face, and our products are designed to enable you to improve supplier base management efficiencies within very complex, global organizations.
Whether seeking to harmonize your processes and procedures, ensuring regulatory and corporate compliance, or gaining deeper insight into supplier information and behavior, HICX can streamline these efforts and focus your resources on more strategic objectives – and we welcome the opportunity to show you how.
Featured Case Studies
A large global pharmaceutical manufacturer, without automation and consistent supplier add/change processes, struggled with operational inefficiencies, lack of visibility into supplier risk, and poor company image. With HICX Solutions they were able automate their supplier add/change process, open the requesting to the whole business, assess supplier risk upfront, and ensure compliance requirements were met. After only 4 weeks, they were able to reduce duplicates, shorten the onboarding time by 80%, and recover over $200,000 in hard dollar savings.
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A large global pharmaceutical manufacturer, with 30 ERP systems and 800,000+ suppliers, struggled with onboarding and compliance issues. With HICX Solutions they were able to centralize and enrich their supplier and spend data, run risk assessments, and ensure compliance. By streamlining their process and gaining visibility, they were able to recover over $1,000,000 in hard dollar savings annually.
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