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Supply Chain Logistics

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The new North Chicago facility, slated to open in 2027, will boost domestic production of key drug ingredients for immunology, neuroscience, and oncology therapies, reinforcing US pharmaceutical capacity amid industry reshoring and tariff concerns.

AbbVie Invests $195 Million to Expand Stateside API Manufacturing 

The CDMO’s new services at its Hopewell, NJ facility delivers scalable, phase-appropriate production, in-house quality control, and domestic sourcing to help gene therapy developers reduce complexity, speed timelines, and ensure regulatory compliance.

ProBio Debuts End-to-End GMP AAV Manufacturing to Accelerate Gene Therapy Development

A new two-phase initiative aims to streamline facility approvals, reduce reliance on foreign pharmaceutical production, and bolster domestic supply chain resilience amid rising tariffs and reshoring investments.

FDA Launches PreCheck Program to Strengthen US Drug Manufacturing

Meanwhile, drugmakers ramp up US manufacturing investments to navigate policy shifts and protect supply chain resilience, as the Trump administration enacted tariff rates between 10% to 50% on various trading partners early this morning.

Trump: Tariffs Could Potentially Hit 250%

With 14 new lawsuits filed and 132 total complaints across 40 states, Novo Nordisk is intensifying efforts to protect patients from unapproved compounded semaglutide products by targeting pharmacies, telehealth providers, and deceptive marketing practices that compromise safety, mislead consumers, and violate FDA regulations.

Novo Nordisk Ramps Up Legal Fight Against Compounded Semaglutide Knockoffs

Potential 250% Pharma Tariffs Could Pressure Margins Without Directly Raising Patient Costs

, Dave Malenfant, a healthcare supply chain expert, discusses the potential impact of a proposed 250% tariff on pharmaceutical imports, emphasizing that the effect depends heavily on where in the supply chain the tariff is applied. If imposed on active pharmaceutical ingredients (APIs), the impact would be minimal, as APIs contribute relatively little to the total cost of a finished drug and adjustments could be made through negotiation. However, if applied to finished pharmaceuticals or key components—such as bottle plugs, closures, molded parts, and glass—the cost implications could be significant, since these materials represent a substantial portion of overall manufacturing costs.

Malenfant notes that the US conducts much of its pharmaceutical research and development domestically but often outsources manufacturing to lower-cost countries, only to re-import the products for sale. He questions this practice, arguing that products sold in the US should be manufactured domestically to strengthen the supply chain and reduce dependency on foreign production. He cites examples of non-US companies, such as the world’s largest generic drugmaker, establishing manufacturing facilities in the United States as a step in the right direction.

The interview also addresses duty drawback, a current process allowing companies to recover duties paid on imported pharmaceuticals, which the proposed tariff regulation would reportedly eliminate. Without duty drawback, the financial burden on manufacturers and distributors would increase.

While higher component costs could drive up product expenses, Malenfant believes that companies are unlikely to pass these increases directly to patients. Instead, they may absorb the costs by reducing margins, particularly since US pharmacompanies already operate with some of the highest profit margins globally. However, the ripple effect would reach insurance companies, prompting complex negotiations between insurers, distributors, and manufacturers to prevent direct cost increases to patients and maintain access to medications.

He also comments on how the tariff could cascade through the pharma supply chain; the

downstream operational challenges that might arise for pharma companies;mitigation strategies industry leaders should already be exploring; and much more.

If a 250% tariff on pharma imports was to be implemented, what would the immediate cost implications look like for manufacturers, distributors, and ultimately, patients?

It depends where the tariff is applied. If you're talking about the active pharmaceutical ingredients, they'll have very minimal impact, as you get into the royalties and all that. When you look at the cost of a pharmaceutical product, a lot of the cost is not in the active ingredient, as much as the components to package it in the processing. If we are buying a finished pharmaceutical and it's got a 250% tariff on it, and the proposed regulation says that there will not be a duty drawback, because right now, on a lot of pharmaceuticals, you have duty drawback, which means you pay duty upfront, and then you can go and apply to the government and draw back.

What that does is it will have a direct impact throughout the entire supply chain, but at the same time, it's telling the US, why aren't we making these pharmaceuticals in the United States? Most of the research and development has been done in the United States, but then we export it out to cheaper countries to make the product, and they import it back in, such as Singapore—I’m not going to talk about India, because India is a unique situation—or other countries, and then we import it back in trying to distribute it within the United States. Good FDA approval and distribute in the United States. I'm not proponent of that. I think if we're going to sell in United States, I firmly believe that we should make it in United States.

An example, Nico, is the largest generic pharmaceutical company in the world is not American, but yet they're now manufacturing in the United States. My view is that, depending on where in the process, is that duty going to apply? Now it says it's going to apply throughout any pharmaceutical, including active pharmaceutical ingredients, components, and manufacturing, but if it's raw materials, active pharmaceutical ingredients will have a very minimal impact on anything, because we can make adjustments in the way we negotiate it.

If it's components like bottle plugs, closures, molded parts, glass, that has a bigger impact, because that is the one of the bigger costs within the main total cost of a pharmaceutical. That will probably increase the cost of the product. Does it mean it's going to be a price increase? I don't believe so. I think the companies will eat it up in their margins, because here in the United States—and I know some of the listening audience will probably not like me saying this—but the US enjoys the largest margins in pharmaceutical drugs in the world.

Having the tariffs, you have to decide, do we eat it in margin, or do we pass it on to the consumer? By the way, it doesn't really get passed on to the consumer, it gets passed on to the insurance companies, and the insurance companies certainly are not going to accept it, so the network is going to be disrupted, and there's going to be a lot of negotiations between the partners, between distributors and insurance companies, to offset it so that there is not a direct impact to the end patient.

In the first part of his Pharma Commerce video interview, Dave Malenfant, a healthcare supply chain expert, explains how steep pharmaceutical import tariffs might affect costs at different points in the supply chain, why component pricing poses a bigger risk than active ingredients, and how insurers, distributors, and manufacturers may negotiate to shield patients from price increases.

Ways Pharma Supply Chains Can Cut Scope 3 Emissions Now

, Heather Zenk, Cencora’s president of US supply chain, describes how today's distribution networks must seamlessly connect manufacturers to care sites that range from large academic centers to rural pharmacies and physician offices. This “last mile” delivery is essential because, as Zenk notes, “all healthcare is local.” Patients want access to advanced therapies close to home, and distributors play a critical role in making that happen.

A major focus in this effort is maintaining product integrity, especially for cold chain items that must be stored between 2–8°C. Innovations in cold chain management now go beyond temperature tracking; they include predictive maintenance of infrastructure such as freezers and compressors. Distributors not only monitor product temperature but also evaluate the performance and potential failure risks of the equipment that manages the cold chain environment.

Zenk emphasizes the importance of marrying manufacturer data with real-time logistics. For example, if a care site accidentally stores a cold chain product outside the optimal range for a short period, data from the manufacturer can often confirm whether the product remains viable. This responsiveness supports safe patient care and reduces waste.

Another important innovation is the use of reusable cold chain totes, which service over 90% of the US market. These require robust freezing systems and operational oversight to ensure readiness and reliability. Zenk underscores that preventing failure, rather than simply reacting to it, is the next frontier in pharmaceutical distribution. By using data-driven insights and predictive engineering, the distribution process becomes more resilient, ensuring that patients can access vital therapies without delay or compromise.

She also comments on the advanced technologies that are proving most effective in enhancing real-time visibility and operational efficiency; strategies organizations should prioritize to ensure compliance while minimizing disruptions for manufacturers and providers as the DSCSA compliance date approaches; lessons learned from recent drug shortages and global disruptions; the practical steps that can be taken in transportation, packaging, and warehousing to meet sustainability goals without compromising reliability or cost-effectiveness; and much more.

Reducing Scope 3 emissions remains a major challenge for pharma supply chains. What practical steps can be taken in transportation, packaging, and warehousing to meet sustainability goals without compromising reliability or cost-effectiveness

 There's some kind of basic things. One, inside the warehouse space. How are we using energy? Can we use solar? Can we do something as simple as having motion detector lights that come on and off? If you're not having to go down three aisles in a warehouse, could we have the lights shut off? It sounds very basic and very kind of 1981, but not everyone's doing it. And those are things that are available to do. You just got to put in a little bit of elbow grease and do it. And looking at newer HVAC models that have new ways where they can use water to recycle, to heat and cool, those types of pieces of equipment are 10% more, but your return on investment on that is under two years. Some of these really basic things from a warehouse is like that.

The other is, when can we use a returnable transportation package that can either be in the cold chain space or that can be in the ambient space, and where do we continue to use that to move through the channel? That’s something clearly. The other thing is any of the materials that go inside a cold chain asset, so phase change material, which is the gels or the packs that go into the cold chain, or sometimes, we see those come in with ambient at times. We may need to use those to keep something in an ambient temperature or check humidity. For those, we’re using reliable vegetable-based phase change material, which I will admit, does not look fantastic. It looks a little bit like a child's diaper sometimes inside.

It’s not the most pretty to use, things like that inside the warehouse. I think outside, it's other things. We are also scratching on our business. Can we consolidate totes? That also sounds very basic, but if a customer is maybe placing four orders a day because they have four different sites of care, or in a building, four different RNs or four different pharmacies are ordering. Could we consolidate that all into one shipment instead of sending four different packages?

We're asking those kinds of questions of our customer base too, and then also, do you need two deliveries, just some of those savings. Then, of course, the obvious around we're looking into the big things like EVs, electric vehicles. We're looking into new packaging ways. Some of the new packaging isn't right at the economical price point that it needs to be at the scale and volume, but when will it get there? How do we stay on top of that? AI is the topic of it too—can AI help us consolidate orders, or can it alert the site?

This is your sixth order you place today. Would you like everything to come into one? We have some sites that want shipments broken out by maybe the aisle in the pharmacy that the products are in so they can put them away. It helps them with workflow, but is that at the expense of getting 18 totes, or would you like four? We're letting them make those choices where before those weren't choices they could make. We also started to talk to some of the sites. Would you like, maybe for them, would you like shipments two times a week, instead of five days a week? We’re really working on, how do we integrate further into the supply chain, and same with our manufacturers, could we get two shipments a month instead of four shipments a month? Would that help them with they have to come twice, so we're not using as much energy.

Those are things we're all looking at, if we can make the economics the same, make everything viable. And those aren't easy things. Those are just collaborative, grind it out, but it helps immensely with Scope 3, and then it gets out of some of these really large, yes, we're looking at EVs, and we're looking at all that, but these other things that are just elbow grease, hard work to do, are going to drive it in the future, versus the one big thing that's going to happen later on.

In the final part of her Pharma Commerce video interview, Heather Zenk, Cencora’s president of US supply chain, outlines practical, cost-conscious strategies for reducing Scope 3 emissions in pharma supply chains, from smarter warehouse lighting and returnable cold chain packaging, to order consolidation and AI-enabled delivery optimization.

Lessons From Shortages and Global Disruptions

What lessons have been learned from recent drug shortages and global disruptions, and how are supply chain leaders building resiliency to prevent future challenges?

The process there is to get others in the boat with you. How do we leverage public- private partnerships? How do we make sure we understand our public policies driving the way the marketplace is reacting to product availability, or are there public policies that are hindering a manufacturer's ability to bring product to market? 

Then, also looking at using technology and data to make a finished pharmaceutical. You may have 100 components that go into that—if not more—and it can be anything from an active pharmaceutical ingredient to an excipient, to a key starting material, to something as simple as the cotton swab that goes inside the bottle, and the manufacturer to track all of those materials that go into the finished good is what they do. That's why they're a manufacturer. We said, how can we help identify, if we're selected with a partner that has that start to happen, how do we go further up the supply chain?

If key starting material is in a war-torn country or in geopolitical unrest, is there another manufacturer that has less risk in that space that we could be able to procure product on behalf of our customers or on behalf of their patients, and allow the manufacturer some time that might have a material or product that's in a geopolitical unrest to think of a different way to source their product?

We also want to continue to support manufacturers. We don't want to switch so quickly between manufacturer number one and manufacturer number two that there isn't good, stable supply chain coming out of it on the other side. We're really looking at, how do we give extended contracting in the business space so they have committed inventory, committed volume, so that manufacturer can plan better. But the also think about, how do we collaborate differently with them to give them some support, but allow them time to find a different way to source it, still having product available for the marketplace, and allowing that to happen.

The supply chain is very complex. Business drives decisions. Product availability drives decisions. When humans get involved, relationships drive some decisions. How do we optimize all of those things together to make sure that we've got enough product available to support patients in the US and globally?

In the fifth part of her Pharma Commerce video interview, Heather Zenk, Cencora’s president of US supply chain, explores how public-private collaboration, smarter sourcing strategies, and long-term manufacturer support are helping to fortify pharmaceutical supply chains against future crises.

Pharma Industry Shifts Toward Full Activation

What is the DSCSA compliance readiness level, as far data management/exchange is concerned?

I think we feel like we've worked on this, we've pushed, we've pulled, we've failed, we've reset. I think we've done it. I think now we really need to say, let's go. Let's do this. Let's keep it happening, and then let's make sure we really aren't stopping life-saving medications from going through the supply chain. But also, we're going to have to hit the go button so we can really start to say, do we have risks? What risks are we seeing? Are what we are predicting really happening, I think are some of the key things.

We're really focused on exception management. I say you have two exceptions, you either have product without data or you have data without product. All kinds of use cases can fall under those two examples. We're really saying, how do we support that? Then, how do we support our partner? How do we make sure if something does get identified as suspect and illegitimate which we've had some—ironically, we had one bottle where the label was upside down, and we had a site of care report that to us; if this doesn't look suspicious, I don't know what is. Again, just an error on a manufacturing line, but you know what? The supply chain reacted in the right way.

It got identified. It got notified. We talked to the manufacturer. The manufacturer is like, oh, shoot, yeah, we had one case of 24 that got inverted. Thanks for notifying us. Can you pull it back from the site of care and give them an appropriate label? We're happy to support, so it works. It's going to be a new muscle for the entire supply chain, but it's been working between the manufacturers and the wholesalers for quite some time now.

In the fourth part of her Pharma Commerce video interview, Heather Zenk, Cencora’s president of US supply chain, explores how public-private collaboration, smarter sourcing strategies, and long-term manufacturer support are helping to fortify pharmaceutical supply chains against future crises.

The Twin Forces Shaping Pharma Logistics Sustainability

principal with Ducker Carlisle, sheds light on the critical issue of Scope 3 emissions and their growing relevance in the pharmaceutical industry, particularly across warehousing, packaging, and outbound transportation.

Chenenko defines Scope 3 emissions as all indirect emissions that occur after a pharmaceutical product is manufactured. While many companies focus on the sustainability of raw material sourcing and production (classified as Scope 1 and 2), Scope 3 encompasses everything that follows: storing products in warehouses, packaging them, transporting them to market, and ultimately, their end-of-life disposal. Although these post-manufacturing steps may not seem like the largest contributors to a company’s carbon footprint, they are significant, and frequently overlooked.

What makes Scope 3 emissions particularly challenging for pharma manufacturers is their indirect nature and the reliance on external logistics and supply chain partners. However, Chenenko emphasizes that these areas closely align with the day-to-day operations of supply chain teams, making Scope 3 an accessible and actionable area for emissions reduction. For instance, optimizing packaging materials, choosing greener transportation methods, and reducing energy consumption in warehouses are all tangible ways companies can drive impact.

Importantly, ignoring Scope 3 emissions not only undermines comprehensive sustainability efforts but also excludes a large portion of stakeholders responsible for distribution and logistics. Chenenko argues that targeting Scope 3 emissions allows for faster, more practical sustainability gains than commonly assumed, and presents a strategic opportunity for pharma companies to align environmental goals with operational priorities.

In conclusion, Chenenko advocates for a more holistic sustainability strategy that fully integrates Scope 3 emissions. By engaging supply chain stakeholders and taking action across the post-manufacturing lifecycle, pharmaceutical companies can make meaningful progress toward their environmental goals while enhancing overall supply chain efficiency.

pecific metrics can pharma companies realistically track today to measure distribution-related sustainability performance; how manufacturers can overcome the data gaps from suppliers and third parties when aiming for sustainability certifications or ESG reporting compliance; best practices for reducing greenhouse gas emissions across distribution channels without disrupting supply chain efficiency;how regulatory expectations and customer pressure will shape sustainability efforts in pharma logistics in the future; and much more.

How do you see regulatory expectations and customer pressure shaping sustainability efforts in pharma logistics over the next three to five years?

The sustainability regulations, requirements, changes, are not unique to pharma logistics, and the reason that's good is because it's not just your industry—it's the industry of supply chain. It's really important to look at this on a geographic basis. In Europe, they're really not pausing. They're pressing towards more regulation, more control, more reporting. All of that is a good thing for sustainability, and can be maybe a bit of a short-term headache, but will have long-term benefits. In the US, i's hard to see at the moment, in July 2025, there being less regulation in the future than there is today on this sort of thing, so we assume US regulations will get more stringent in the future. That's at a national level in the US, or at a Europe-wide level, but if course, there's exceptions.

In the US, let's focus on those exceptions. The big one right now is the EPR requirements, the extended producer responsibilities that are related to packaging in particular, and they're run at the state level. Some states—California, Colorado—are really far ahead on this, and other states will probably follow that trend. That has been very disruptive for a lot of our clients, and has really moved from high-minded sustainability strategy into how do we comply with these specific requirements in this one state, knowing that they might be similar, but a little bit different in a neighboring state or a state in a different time zone.

The overarching driver of this is that customers prefer sustainability. They may not want to pay an extra 10%, 20% on the product, but if given the option for minimal price difference or no price difference, they would rather work with a sustainable company, and in particular, younger customers, who are your customers of the future that prefer sustainability.

I think a good example of this is Amazon's hassle-free packaging where, instead of shipping in a plastic clam shell, they'll ship in cardboard. People aren't buying that because it's sustainable, but it is a lot more sustainable than that plastic clamshell packaging; it's less packaging, it's more recyclable, it's easier to get into, and people prefer it. If we're willing to be a little bit creative and incorporate some business realities like we still have to be profitable here, I think there's a lot that we can unlock on sustainability, whether the pressure is regulatory or not, because the customer pressure is still going to exist and probably get stronger.

In the final part of his video interview with Pharma Commerce Editor Nicholas Saraceno, Nate Chenenko, principal with Ducker Carlisle, explains that as regulatory frameworks tighten across Europe and the United States, and customer preferences lean greener, pharma logistics leaders must balance compliance, cost, and innovation to meet mounting sustainability demands.

Emission-Reduction Strategies That Save Money and Preserve Performance

He also comments on the specific metrics can pharma companies realistically track today to measure distribution-related sustainability performance; how manufacturers can overcome the data gaps from suppliers and third parties when aiming for sustainability certifications or ESG reporting compliance; best practices for reducing greenhouse gas emissions across distribution channels without disrupting supply chain efficiency;how regulatory expectations and customer pressure will shape sustainability efforts in pharma logistics in the future; and much more.

What best practices or innovative strategies have you seen in the industry for reducing greenhouse gas emissions across distribution channels without disrupting supply chain efficiency?

Our favorite case studies, as you mentioned, improve greenhouse gas emissions, keep the supply chain flowing as normal, and I'll add one more: they will save you money in many of these cases. I've got a few examples, just based on our standard three phases of the distribution process. We'll start with warehousing, then we'll cover packaging and transportation.

On the warehousing side, a really simple one is there are companies that come around and compact trash. You could have a trash compactor in your warehouse. Those are pretty expensive, or you can pay a company to come smash the trash in a dumpster that's outside your facility. Now, instead of making four trips to the landfill, you're making one. That probably saves you a little bit of money. Your waste hauler may appreciate it, they may charge you a little bit less, and it saves you a lot of emissions, because that's one truckload instead of four truckloads—the extra weight does not even come close to offsetting the additional miles from running four trailers or four trucks.

If you want to make this more complex and make a bigger dent, you can search for—as one of our clients has done—a waste disposal site that will incinerate waste for power generation. Just incinerating for power generation is an improvement there. On the other hand, in some cases, those incineration sites may be much further away than the landfill, so being able to do that whole business case to unlock all of that, that's a great way to you can reduce your emissions. It covers your warehousing. It definitely does not disrupt your supply chain efficiency. We have to be careful about the business case there.

Moving on to packaging, many companies use returnable containers to minimize single-use or disposable products. There's a side benefit to returnable containers, which is that they often have a side effect of reducing damages, so crushed box corners, products that fall off the pallet, the use of a bunch of plastic to wrap a pallet—if you're using returnable as you can often eliminate a lot of that. When you can eliminate those damages, then you also, sort of by accident, reduce some of the Scope 1 and 2 emissions, because you no longer have to rebuild or remanufacture, reproduce the product that you just destroyed, or you don't have to repackage it. Returnable containers are pretty simple. Transitioning to returnable containers is tricky at first, and can be short-term disruptive, but can be long-term value add, because often, returnable containers are also a productivity boost and a long-term cost savings, if you are good about tracking the containers.

If you want to make an even bigger investment, especially to your packaging operations, you can use something like a box-on-demand machine that will construct a box exactly to your specifications. I'm sure many people watching or listening are familiar with this concept, but imagine you have a 12x12-inch product. The box-on-demand machine will make you a 12.1 by 12.1-inch box, so you save a lot of excess packaging material, and ultimately, over a long time frame, this has a sustainability impact. It also saves you cost, and it saves you a lot of labor, because a lot of these machines will automatically box the product and pack it. That's a little bit more useful for shipments direct to an end customer, or for retail packaging, rather than mass packaging operations, it tends to be fairly expensive.

The final category of best practices or case studies that I'll talk about is transportation. Many of our clients are switching to electric trucks for transportation. This is not disruptive to supply chain efficiency if you do it in the right locations. One of the best places to do this is in Southern California or Phoenix, AZ, or Dallas, TX. We're looking for fairly high traffic areas where the miles driven are low enough that the truck can do the entire distribution route without recharging, and then it will recharge on a shift break or overnight, and then do it again the next morning. We like those high-traffic areas because it prevents a lot of diesel idling and also the high traffic—although nobody likes high traffic, it sort of, by definition, keeps the mileage low.

A lot of our clients have been switching over to electric trucks in those areas and working with their transportation providers to do that. If you really want to make a big dent in transportation savings, though, you have to reduce your reliance on air freight. Although air freight is not a big portion of the supply chain, it is astronomically problematic from a sustainability perspective. We have worked with clients to do creative things like adding a little bit of inventory to the warehouse network in order to reduce their reliance on air freight to expedite orders out. You may have encountered this in your personal lives, where you're looking at, okay, I can get this from Amazon in two days and it'll come on a truck, or I can get it tomorrow, and it'll come via a plane from a warehouse somewhere on the West Coast. That adds a lot of emissions. If Amazon was a little bit better about stocking closer to you, they could get it for you the next day on a truck. That's not disruptive to the supply chain, but involves quite a bit of supply chain retooling, but can be also a cost savings, and is a huge way to reduce your emissions.

In the fourth part of his video interview with Pharma Commerce Editor Nicholas Saraceno, Nate Chenenko, principal with Ducker Carlisle, shares best practices for reducing greenhouse gas emissions across distribution channels without disrupting supply chain efficiency.

Tackling ESG Data Gaps in Supplier and Third-Party Reporting

How can manufacturers overcome the data gaps from suppliers and third parties when aiming for sustainability certifications or ESG reporting compliance?

There's two ways you can attack this challenge of data gaps. One is that we're seeing with companies that we work with a lot of success incorporating reporting requirements into requests for proposals or the procurement process. For example, let's think about transportation. When you bid out a transportation lane, you can insert in the request for proposal, you need to tell us the amount of fuel you consume, or tell us the number of trailers you ship, or even better yet, tell us these trucks’ DOT numbers so that we can match them up with the fleet sustainability index, which is a company unrelated to ours that does a really good job tracking transportation emissions. Don't be afraid to put that information directly into requests for proposal, because that helps motivate everybody.

Then, your carrier in this case will want to work with you because they they'll want to give you that data because they feel like they need it to win the business. In practice, we find the best way to do that is to ask for the information and say it scores you extra points in the procurement process, but it's not required, because we don't want to put you in a situation where you're not seeing low-cost bids simply because that company, for whatever reason, cannot comply with the sustainability certification. You still want to get that information in, and then you can make a decision based on that. So leg one one is pushing vendors, carriers, suppliers, a little bit more to give you a little bit more information. The best place to do that is in the procurement process or during a contract refresh.

Leg two of the strategy is selecting certifications that can work with you based on the amount of data that you actually have. So when you select the type of certification, the best certification programs out there are pretty flexible, and they will allow you to get a certification. It may not be the top tier, it may not be platinum level or diamond level, but it will allow you to get certified even though you don't have all of the data that maybe the most sustainability-minded company has. You can show some progress, and you can incentivize improvements within your company and still get a certification without just getting rejected completely because you lack one of 100 data points and you have the other 99.

In the third part of his video interview with Pharma Commerce Editor Nicholas Saraceno, Nate Chenenko, principal with Ducker Carlisle details how manufacturers can overcome the data gaps from suppliers and third parties when aiming for sustainability certifications or ESG reporting compliance.

How Predictive Maintenance and Localized Distribution Are Shaping Pharma’s Future

, Heather Zenk, Cencora’s president of supply US supply chain, describes how today's distribution networks must seamlessly connect manufacturers to care sites that range from large academic centers to rural pharmacies and physician offices. This “last mile” delivery is essential because, as Zenk notes, “all healthcare is local.” Patients want access to advanced therapies close to home, and distributors play a critical role in making that happen.

As pharma products become more complex, how is the distribution strategy evolving to ensure timely, safe, and compliant delivery? Alongside that, what innovations in cold chain technology are setting the standard for ensuring product integrity across these complex distribution networks?

We're sitting between the manufacturers and the sites of care, and we really see ourselves as the connector. I'm connecting access from a manufacturer's new and innovative therapy to a site of care, and that site of care could be an independent pharmacy in a small rural town, all the way to a large academic medical center in a huge urban area, to a physician- based office. We really look at all sites of care, because realistically, all healthcare is local.

You don't go outside of your community to receive care. You like to see your physician at the grocery store. You like to see your pharmacist around town. It provides comfort, it provides the realness of human connection. We really take it seriously that we're connecting new therapeutic ways to the sites of care. And with that, it's how do we make sure their product is viable? With a lot of the sustainability and new products that are coming to market, we need to keep in 2-8°C, which, for the common person, is refrigerated. We also want to make sure that we have a way to track that. The manufacturer would know when they develop it, what the exclusion is, so if it gets to 9°C, how long can it be at 9°C, and still viable if it gets to 1°C?

But realistically, if you keep it in 2-8°C, the expiry date that's on the package would be the therapeutic window that a site of care could deliver it. A lot of what we're doing is trying to connect—as we tend to do every day—the data with the time. If by chance, a site of care would call to say, “oh shoot, I got that cold chain product. It's sitting on my shelf. I didn't notice it. It's probably been about two hours, is it still okay if I give that to my neighbor, my friend, my patient?” Most of the time, we have data from the manufacturer that can say that's viable. It can be out of this window. Then two, we're taking seriously inside our four walls. It’s monitoring the temperature, yes, but it's also monitoring the equipment that manages the temperature. Think of it as, and this is non-sexy stuff for supply chain, but compressors, think of it as HVAC units. Think of it as the entities that are running our freezers that have the basic material that goes into our reusable totes that we use every single day. We have reusable totes that are driving 90-plus-percent of the US market. How do we freeze those? If a freezer’s equipment is going to fail, it's us understanding this compressor is now at 70%, and we should have someone either fix it, look at it, stop it, or understand the risk that we have.

Monitoring temperature is table stakes. You have to be able to do that. It's now how do I anticipate if a piece of equipment is going to fail? Does that piece of equipment need a preventative maintenance check by a maintenance team member? Setting those types of things up as much as we can to eliminate equipment failing or anticipate when it might and take those signals. I don't think I would have thought about doing that as a as a pharmacist, but we all think about our home life. Your refrigerator fails at the worst possible time. How do we stop that? What types of engineering things can we look at to eliminate that? And that's really where we're going—from a tactical positioning—so we don't have large failures. And two, I think it's also connecting manufacturers’ data from how they develop a product, how they get it to finish dosage, where do they take it?

In the first part of her Pharma Commerce video interview, Heather Zenk, Cencora’s president of US supply chain, explores how public-private collaboration, smarter sourcing strategies, and long-term manufacturer support are helping to fortify pharmaceutical supply chains against future crises.

Practical Sustainability Metrics for Pharma

What specific metrics can pharma companies realistically track today to measure distribution-related sustainability performance?

Let's cover a few things simply, and then I'll give you a few more complex topics as well. On the simple side, in warehousing, pretty much everybody can track how much energy their warehouse uses, whether it's electricity, natural gas—you could have some solar generation. You could track by looking at your utility bill, just like you would in your home, how many kilowatt hours of electricity you track. As this gets a little bit more complex, you can work with a utility provider to figure out what's the source of the electricity; if it's coming from a coal plant, can we get it from a different source? Can we change over and pay?

Maybe we need to pay a little bit more, maybe we need to put our own rooftop solar panel in, or pay like a wind share or solar share to convert a little bit. That’s maybe complexity level B. Complexity level C is looking at waste streams out of the warehouse. Products come in, they are often returnable containers, but you get a lot of cardboard, a lot of single-use plastic, and a lot of pallets. Where does it go? It's relatively easy to track how much you dispose of. It's relatively hard to know where it goes.Similarly, on the packaging side, many companies know the breakdown of recycled versus non-recycled packaging. It is a little less common and even more beneficial to know by material type. We've got a certain amount of plastic that we use, some of that is recycled. Some of that is new. We've gotten a certain amount of cardboard that we use. Some is recycled, some is new, but it breaks down even further into whether it's recycled from reclaimed sources, whether it's recyclable material. You might be using recycled material, but it's not recyclable. There’s a lot of different ways to look at packaging.

One of the most impactful things on the packaging front is using returnable containers, which can often result in pretty immediate expenditure. You have to buy the containers and develop the supply chain. Developing those business cases can be a little tricky, and we can touch on that later. Then on the transportation side, this one's probably the trickiest, because many companies know how many shipments they send out the door. A smaller percentage of those companies know how many trailers they send out the door, and an even smaller percentage know how full those trailers are. Very few companies know what's powering those trailers.

Let’s just take trucking as the single example here. They're almost all diesel trucks, but depending on the age that they were manufactured, the manufacturer, the engine type, the emission standards that were in place at that time, how far they travel, how much weight is on there, and even the terrain that they go over—this all impacts. monitoring emissions.

The overarching best practice here is to not let perfect be the enemy of good. If you only know your trailer count, try to get miles. Don't worry about getting fuel. Don't worry about getting terrain. Just make one step towards gathering a little bit more information and being able to more accurately manage. That's always our recommendation—no matter what the industry is—and that will get you a little closer to having a good measurement and being able to properly incentivize.

In the second part of his video interview with Pharma Commerce Editor Nicholas Saraceno, Nate Chenenko, principal with Ducker Carlisle, dives into the metrics pharma companies can track today in order to measure distribution-related sustainability performance.

Unlocking Sustainability Across the Supply Chain

What exactly are Scope 3 emissions, and why do these pose such a challenge for pharma manufacturers, particularly within warehousing, packaging, and outbound transportation?

I will simply define it as everything that happens after the company has produced or manufactured the good, which, in your case, is pharmaceutical products. Many times, when people are thinking about sustainability, they're thinking about, okay, what is going into this product that I'm making. From a raw material perspective, if you're making something out of metal, you have to mine it. If you're making a drug, you have to acquire the chemical compounds, process things, maybe extract them from something else, and then you have to do the manufacturing.

That is absolutely a huge contributor to overall sustainability and the amount of emissions and waste produced, but it omits what the industry calls Scope 3, which is everything after that point. This is a bit of an oversimplification, but you could define Scope 3 as you've made the drug, you've made the product, everything else is Scope 3.

You need to put it in a warehouse, as you mentioned. You need to package the product. You need to transport the product out. Ultimately, it will get used and then disposed of. What we like about focusing on Scope 3 emissions is that it is almost a perfect overlap with what your distribution supply chain people do it on a regular basis. They warehouse things, they package things, they transport things, so although it may not be the biggest contributor of emissions or the biggest sustainability detractor, if you ignore Scope 3, you're missing a big chunk. You're missing a lot of company stakeholders, and oftentimes, the gains in Scope 3 emissions can be fairly easy to access, easier than you might expect.

In the first part of his video interview with Pharma Commerce Editor Nicholas Saraceno, Nate Chenenko, principal with Ducker Carlisle, explains the meaning behind Scope 3 emissions, including why they pose such a challenge for pharma manufacturers.

Manufacturing & Packaging

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