Various forms of technology—including in the serialization and refrigeration spaces—are necessary in order to keep goods flowing smoothly through the supply chain.
While it might not be as high profile as the consumer goods or food/beverage supply chains, the pharmaceutical supply chain is just as important—if not more so—and faces many of the same logistical challenges. Changing demand, evolving regulations, and general industry trends are forcing pharmaceutical logistics professionals to re-examine tried-and-true strategies through the lens of new technologies.
In particular, I see three challenges remaining top-of-mind for the pharma supply chain in the short, medium, and long-terms:
Short-term: Enforcement of the Drug Supply Chain Security Act
While it has been more than a decade in the making, the FDA appears to be on track to begin full enforcement of the Drug Supply Chain Security Act (DSCSA) come this November.
The DSCSA, designed to reduce the amount of counterfeit product reaching consumers, requires a multi-step verification process at each node along the supply chain. Manufacturers assign each prescription drug package a series of five serial numbers. Distribution facilities must be able to integrate their systems with the pharmaceutical manufacturer to ensure each package stored and shipped is consistent with the manufacturer’s serial numbers. And once the package reaches the pharmacy, the pharmacist must verify each packages’ serial numbers with the manufacturer’s serial numbers before filling any individual prescription.
The DSCSA’s thoroughness will certainly help provide peace of mind for patients, and it can help the pharmaceutical supply chain catch counterfeit drugs before they cause costly investigations and lawsuits. However, not everyone is ready for full enforcement. While pharma manufacturers and major drug store chains have the resources needed to obtain DSCSA-compliant serialization and electronic data interchange technology, smaller pharmacies may not be able to afford the upgrade.
The FDA has yet to offer a solution for these pharmacies. A January-February 2024 survey conducted by the American Pharmacists Association found only 14% of dispensaries were fully outfitted for compliance—and many of their respondents were independent pharmacies.1
However, in a newer development, the FDA did issue an exemption until Nov. 27, 2026 for dispensers with 25 or fewer full-time employees that are licensed as pharmacists or qualified technicians.2
Although the Healthcare Distribution Alliance has questions out to the FDA about how to help these pharmacies, there’s no solution in place yet. Logistics professionals should track FDA guidance in the coming months, including any delays of DSCSA enforcement.
Medium-term: Applying data to minimize supply chain disruptions
If there’s any message this decade has offered pharmaceutical supply chains, it’s “expect the unexpected.” COVID-19 interrupted manufacturing, then less than a year later tested Pfizer and Moderna as they worked to meet unprecedented demand for the COVID vaccine. More recently, the unexpected collapse of the Francis Scott Key Bridge forced immediate overhauls to traffic patterns, and increasingly intense weather could set production and delivery back weeks.
While logistics professionals may not be able to control the weather, they can leverage data to be better prepared for these events. Over the next few years, there will be a greater focus on building “control towers” within pharmaceutical supply chains, integrating both internal and external data to outmaneuver rapidly changing conditions.
For example, understanding which facilities are experiencing labor shortages can help pharma manufacturers prepare for product shortages and shift production if necessary. Monitoring the path of a hurricane can help manufacturers avoid shipping out time-sensitive product from an impacted distribution center.
Thinking globally, manufacturers are also likely to leverage external data to understand shipping patterns and requirements across countries. Tracking this information can help manufacturers understand when their product is likely to go through customs, while timing the shipment to avoid letting their product spoil because it arrived over the weekend.
Long-term: The logistical implications of more personalized medicine
As our understanding of disease has evolved, so has the pharma industry’s approach to treating patients. Drug manufacturers are moving away from one-size-fits-all medicines and toward treatments, such as injectables, engineered for specific patients. In fact, research suggests the market for injectable drug delivery is likely to grow at a compound annual growth rate of 8.6% through 2029.3
But with the greater focus on more personalized medicine come new complications in how treatments are transported. Injectables require continual temperature control, so third-party logistics providers that are storing it need both extensive refrigeration space and monitoring technology to ensure the temperature never reaches unsafe levels—both expensive propositions. Shippers will need to invest in packaging that can keep injectables in safe conditions for long-distance travel.
In addition, delivery of more personalized medicine will require a strong chain of custody. In metropolitan areas, pharma manufacturers can tap delivery infrastructures through Amazon and similar companies to deliver sensitive medicines for the last mile. But in rural areas, where access to medical care can be more difficult to obtain, delivery is often outsourced to independent contractors, and there’s no guarantee their vehicles are equipped to deliver injectables safely. Chain-of-custody technology helps hold the entire supply chain accountable, and, in the event a medicine spoils, pinpoints where the lapse in safety occurred.
As the injectable drug delivery market continues to grow, pharmaceutical logistics professionals will turn their attention to how best to leverage these technologies—refrigeration, environmental monitoring, and chain-of-custody—while keeping their supply chain viable for more personalized medicine.
Challenges for a changing pharmaceutical industry
Moving medicines through the supply chain has always been a complex process, requiring added levels of security and environmental monitoring. But with the rollout of new regulations, and the shift to more personalized medicine, old strategies of shipping treatments simply won’t hold up to the scrutiny now placed on pharma logistics. In the short-, medium-, and long-terms, the onus will be on improved technologies—including serialization, refrigeration, and data control towers—to keep goods flowing smoothly and in line with stringent protocols.
About the Author
Tim McClatchy is Vice President of Life Sciences at Kenco.
References
1. APhA Survey Shows Dispenser DSCSA Implementation Slow, but Encouraging. American Pharmacists Association. February 23, 2024. https://www.pharmacist.com/APhA-Press-Releases/apha-survey-shows-dispenser-dscsa-implementation-slow-but-encouraging
2. FDA, Waivers and Exemptions Beyond the Stabilization Period (July 17, 2024). https://www.fda.gov/drugs/drug-supply-chain-security-act-dscsa/waivers-and-exemptions-beyond-stabilization-period
3. Injectable Drug Delivery Market Size, Share, & Trends Trends by Type (Device, Formulation), Therapeutic (Infectious Diseases, Cancer), Usage Pattern (Immunization), Administration (Skin, Musculoskeltal), Distribution Channel, Patient Care Setting, & Region – Global Forecast to 2029. MarketsandMarkets. May 2024. https://www.marketsandmarkets.com/Market-Reports/injectable-drug-delivery-market-150.html
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