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Author
Published
February, 2005
Summary
For many years supply chain costs in the pharmaceutical branch were not an issue. However, times are changing; government rulings are becoming stricter, global medication issues are influencing sales prices, more and more pharmaceutical companies have to compete with generic medicines and quality requirements are increasing. In short, profit margins are under pressure and supply chain costs are driven up due to quality requirements. How to tackle this strategic dilemma?
By determining what drives up costs and what gives the competitive edge, you can define your strategic approach. Should the focus be on economies of scale, on optimizing your (logistics) processes or on cooperation?
The presentation at hand focuses on possibilities in optimization and cooperation. The savings potential in annual supply chain costs in the pharmaceutical world are 10-30%. And, whilst quality demands are high, supply chain accuracy is typically no higher than 95%. With the right approach this could be increased to 99,5%, maintaining the cost savings mentioned-above.
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