Meeting the Pharmaceutical Industry’s Global Supply-Chain Challenge

The pharmaceutical industry is a $500 billion global business that requires a tight, safe, and efficient supply chain. Modern pharmaceutical products rely on ingredients and materials from across the globe. It is estimated that 80% of the active ingredients for drugs sold in the United States originates in the global sourcing chain outside the country.

 

The production of pharmaceutical products requires validating every aspect of the receiving, analysis, storage, and handling of drug actives, excipients and other raw materials, following FDA regulation.

 

It is unacceptable for chemicals or excipients to expire before the manufacturing process takes place, such as when their shipment was delayed or they were not shipped with proper temperature and humidity control. Additionally, every state has its own licensing requirements covering drug production. Meeting these requirements is a major challenge for both suppliers and third-party logistics partners that build and implement pharmaceutical supply chains.

 

REGULATIONS

At every stage of the supply chain, shippers must be intimately familiar with the customs and regulations of every country through which freight will pass. They have to observe any quarantine or inspection requirements in addition to understanding the associated service parameters and costs.

 

A lack of understanding about the freight marketplace can delay or prohibit the importation of vendor shipments and—more likely—add unanticipated and unnecessary customs costs and possible exam fees. Also, a pharmaceutical company can incur unanticipated freight costs or surcharges as a result of improper or inefficient routing of cargo. All of these problems must be designed out of the supply chain before it can work properly.

 

Because time-sensitive ingredients are often sent by air, the regulatory logistics challenges that air cargo shippers face at a time when clients are already stressed owing to recession-reduced demand and high energy costs must be considered.

 

New U.S. government standards mandate 100% security screening of all cargo transported on aircraft by August 2010. The Transportation Security Administration (TSA) will not be responsible for the actual physical screening of cargo, but will set standards for and certify Certified Cargo Screening Facilities (CCSFs). CCSFs can be a shipper’s own facility, a freight forwarder, or an airline. In addition to monitoring and auditing CCSF activity, TSA will conduct spot checks and random cargo inspections similar to customs inspections.

 

Screening, whether by x-ray, physical or electronic means, must be done by breaking down pallet-wrapped shipments (PAX) into individual items, with the number of pieces determined by shipper-level documentation. And screening capacity at a single point in the supply chain is not sufficient to accomplish this requirement. Freight forwarders approved by TSA can meet the new rules by using electronics to verify the integrity of a shipment utilizing stringent chain of custody methods.

 

FORWARDER RELATIONSHIP

A strong working relationship with a freight forwarding logistics expert can be essential to helping pharmaceutical producers build an efficient global supply chain. A proficient logistics company designs supply-chain solutions to save money and improve efficiency. Expediters and their customers should use freight forwarders at the vanguard of cutting-edge methodology that includes a comprehensive electronic tracking system. Freight forwarders consistently solve problems in a non-traditional way that adds value, addressing challenges such as refrigeration, theft, customs, regulations, and product tracking.