PharmaView: Should Pharma Fear the Supply Chain of the Future?

As paradigms shift, we also need paradigm expansion.

By Paul Thomas, Senior Editor

Big consulting groups like to publish big reports on big topics. The slick PDFs are punctuated by bold, sweeping pronouncements about the future. “Within five years, the pharma world as you know will have irrevocably changed.”

You’ve heard of A-ha moments? These are oh-my-gosh statements.

We’re peppered with just enough what-ifs and worst-case scenarios to be sufficiently convinced that we’re ill-prepared to face the future—at least without the calming, reassuring hand of a high-paid consultancy.

Whatever their ulterior motives, the reports do serve a valuable purpose: Paradigms are shifting, and they jostle our own paradigms just enough to allow us to entertain a future much different from the present we know.

PricewaterhouseCoopers is good at this, and has just released the latest in its Pharma 2020 series: “Supplying the Future: which path will you take?” The report calls for a “radical overhaul” of the drug supply chain, and has its share of OMG statements about how drugs will be made, distributed, and consumed. It’ll be an era of personalized meds and poly-pills, where drug companies will cater to individual patient needs and products will be “finished” outside the factory.

Companies will need increased access to patient data in order to “build demand-driven supply chains in which healthcare packages for different patients are assembled at ‘super hubs’ before being delivered to their homes.”

Here’s a prediction I’m still trying to get my head around: “Micro-containers with embedded superparamagnetic nano-particles can be treated with an alternating magnetic field to release materials encapsulated in bubbles within the material and thus converted into micro-reactors for the efficient production of thousands of individual doses of tailored biological products.”

Super hubs? Superparamagnetic nano-particles? If you’re a supply chain professional, feel free to break out in hives.

Wynn Bailey, a partner in PwC’s Pharmaceuticals & Life Sciences Advisory practice and one of the authors, admits that the document has its share of tease and torment about what the future holds, and that 2020 is arbitrary. But he also suggests that its thrust—that supply chains of the future will look very little like those today, and manufacturers and partners must view them anew—is valid and important.

One of the biggest differences, he notes, is that drug supply chains will be much more fragmented and disparate than the traditional model developed in the blockbuster-drug era.

“The supply chain that we’ve built historically in the industry . . . will continue to exist for a time, and in pockets,” he said. “But we see the products of the future being a combination of needs that are going to vary according to the patient population, to the delivery site—whether it’s acute care, in the home, or somewhere in between—and that will differ according to the technology that it’s based on—whether it’s gene-therapy, nano-pills, or other kinds of not-too-distant future technologies.” (For a podcast with Bailey about the report, click here.)

Close to You
As supply chain complexity increases exponentially, he implies, the gap between manufacturers and the patient narrows. As Simon Friend, another of the report’s authors, puts it: “Companies must now work hard to get closer to their patients, as by 2020, there is little doubt that the data behind a product will as valuable as the product itself.”

Data is the dilemma. How to capture it, manage it, and share it with partners so that it’s useful to everyone. In “Vital Links: Supplier Risk Monitoring,” Maxiom Group’s Scott Chizzo and Frank Gaibor present a broader, holistic approach to managing the supply chain. Such an approach, they note, is what proactive life science companies must do, but it requires fluid, continuous sharing of information between partners. 

Yet our recent update on electronic pedigrees (see “Pedigree Adopters Play the Waiting Game”) notes how some drug manufacturers have actually “deprioritized” efforts to improve their product serialization, until the regulatory picture becomes clearer. In the trek towards the future, they’re dragging their feet.

2020? It’s a bit too close for comfort.

Maybe the takeaway is that all of us need to think bigger about what the supply chain is and means. “Mention the supply chain to many and the instant association is with trucks loaded with boxes of medicine moving between warehouses and hospitals, clinic, and pharmacies,” says consultant Hedley Rees, in his terrific new book, “Supply Chain Management in the Drug Industry” (Wiley & Sons). “This is true, but it is only the tip of a massive iceberg.”

Rees defines Supply Chain Management as follows: “SCM covers the design, management, and improvement of end-to-end supply chains. This includes all the stages and activities involved in moving raw materials through progressive stages to become products in customers’ hands. All aspects of stewardship to achieve the above are included.”

Stewardship, says Rees, is the operative word, as it implies that everyone in the organization has a role to play. “Researchers, developers, manufacturers, and business support must all play their part.” I’m guessing this includes you?

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