PwC: Pharma Supply Chains Need Overhaul

Pharmaceutical companies are facing increasing pressure to update their supply chains.

For some, it's going to be an uphill battle.

A new report from PwC US concludes that many pharmaceutical supply chains have suffered from what amounts to benign neglect. Now, they are inefficient, under-utilized and ill-equipped to cope with new medicines, cost pressures and health reform expectations.

Essentially, the pharma supply chain needs to adopt a new consumer-oriented focus. As a result, PwC says we can expect the pharma supplier network to become:

Even more fragmented, with different models for different product types and patient segments.


A means of market differentiation and source of economic value.


A two-way street, with information flowing upstream to drive the downstream flow of products and services, while the management of information transferred between the pharma company, the patient and healthcare provider becomes as important as the movement of product.

"The most successful pharma companies will be those that recognize the underlying value locked in their supply chain and can leverage it as a value and brand differentiator rather than just a cost," said Steve Arlington, global advisory pharmaceutical and life sciences leader, PwC. "Companies that recognize information is the currency of the future, will be those that go the final mile and stand out by 2020."

In the report, titled Supplying the future: Which path will you take?, PwC outlines six trends that it says will fundamentally change the way pharmaceutical companies make and distribute their products. These trends include:

Health reform shifts emphasis from product features to patient outcomes


New products types (biologics, bioengineered vaccines, nanotechnology, etc.)


Incremental product launch alters the sales curve


New modes of healthcare delivery (electronic health records, e-prescribing, etc.)


Growing importance of emerging markets


Greater public scrutiny and regulation


The report provides an in-depth discussion of these trends, and it is available for download at www.pwc.com/pharma2020supplychain.