Future proofing the life sciences supply chain will require redefining the supply chain to become more agile, increasing capabilities to support demand-driven performance, and aligning value to unleash untapped assets and expertise. We also share some promising strategies to address today’s disruptive threats and give a sense of the degree of agility required.
The report provides a clear indication about the demands of future proofing the supply chain. Planned and executed properly, the process requires a high degree of commitment, discipline and buy-in from stakeholders. It also points out that the benefits of future proofing are being demonstrated every day in global pharmaceutical markets, enabling increased revenue growth, optimized new product pipelines, improved material flows and reduced operational risk.
Supply chain agility involves adapting to variations in demand, supporting shorter supply cycles, and rapidly recalibrating plans in the face of market, price and supply volatility. Companies must be able to constantly recalibrate plans to benefit from developing new manufacturing platforms and processes, share resources, support flexible outsourcing, and rebalance “pull” versus “push” models. Strategies for increased agility can include standardized, manufacturing platform collaboration, a paradigm shift to continuous, modular processing, and shared resources during demand surges.
Life sciences companies need to expand and strengthen their partnerships by complementing internal capabilities with external resources and suppliers to effectively adapt to the changing landscape. They also need to create online capability teams to enable cross-functional knowledge management, develop close partnerships in local markets, and leverage data as an asset through predictive analytics. Strategies in this area include demand-driven contracting supported by end-to-end supply chain technology and networks of third-party suppliers to scale production up or down based on customer demand.
Increased visibility is a key value as the industry moves from volume-based to value-based models centered on patient care and wellness, a development that could benefit the industry as a whole. Companies clearly demonstrating the value that their products bring to patient outcomes can access broader patient populations. At the same time, organizations that work more closely with patients can better fulfill care requirements and strengthen brand loyalty. This will involve the use of data analytics to enable faster, more efficient drug development and targeted pricing. Emerging customer trends will need to be identified on a continuous basis, and service offerings should be expanded through strategic partnerships. Marketing internal assets and expertise can be a key strategy for enhancing value. One example is sharing data centers, networks and licensed software with outside parties on a monetized basis.
© 2018 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.