The Distribution Network of the Future


Three trends driving emerging technology in the drug supply chain.

Pharmacies are effectively the last and most important leg of the pharmaceutical supply chain. Providing the right drug at the right time is a cornerstone of delivering care and operating a healthy business. To do so efficiently, pharmacies rely on distributor relationships that allow them to successfully fill hundreds of prescriptions every day. That demands processes and progress in drug distribution that accomplish two important goals - consistent performance by the distributor for the customer and increased supply chain efficiency for the manufacturers that serve these critical links in healthcare delivery. To that end, there are three supply chain trends forming the distribution network of the future - and the right distribution partner can leverage all three to shape what successful healthcare delivery looks like.

  • The patient-minded supply chain. Providing superior care means focusing on the patients who need affordable, accessible pharmaceutical products. Being patient-focused requires a focus not only on product access, but also on safety. The supply chain of the future is patient-minded - it meets or exceeds the regulatory requirements of the industry's landscape to ultimately ensure the patient's confidence that the medicine they receive is safe while giving the prescription provider the greatest extent of flexibility in fulfilling their patients' medicinal needs. Drug distribution is becoming far more than pick, pack and ship. From safety and traceability measures driven by the Drug Supply Chain Security Act (DSCSA) to distributor-led initiatives that create internal engagement around the importance of the patient to the business, getting it right means getting the right prescription to the right individual at the right time.
  • Intelligent design. Advances in material-handling technology and greater use of big data in operations will further influence the design of cost-effective and flexible supply chain solutions. The most innovative distributors are measuring supply chain efficiency down to the second with tools that lend visibility to inventory modeling, SKU velocity, activity-based modeling and order transit time. Successful distribution networks are leveraging data and customer feedback to evaluate any initiative that could create a more accurate order and can help fill orders more quickly. The flexible distribution center of the future can accommodate a multitude of patient needs, order volume fluctuations and resource variability while incorporating customer-value added services. Expect to see more distribution centers modeled after European counterparts - typically highly automated - and more of a transition away from manual picking methods to advanced system solutions that deploy goods-to-man technology, robotics and vision-based systems. Forecasting order traffic through a distribution center allows the most efficient physical routing path of an order that can shave time off the order-to-fill process that, at the end of the day, gets products in the customer's hands faster and allows them to satisfy patient-dispensing expectations.
  • Increasing competition for talent. It is estimated that nearly 1.4 million people will enter the logistics and supply chain industry by 2018. Where will the best talent end up? Distributors - ones that invest in associate development, value and recognize their contributions and establish a career path for their continued growth. These distributors will be the ones cultivating the employees of the future. The most coveted positions will be at companies that offer enhanced facility amenities, flexible work schedules, have a genuine concern for the environment and embrace advanced distribution systems such as full-spectrum augmentation, predictive work-flow planning, mobile maintenance and shuttle-delivery systems. In addition, distribution networks must continually evaluate wage scales to ensure industry alignment while marketing everything from incentive systems and benefits to associate development and career pathing. It is an exciting time to work in the logistics arena, as competition for these associates will continue to support emerging technology.

The value of innovation
Innovation in the supply chain drives efficiency. But how do pharmacies benefit? As ever, it's about the patient. And when a pharmacy's patients have the safest, most efficient access to the medications they need to manage and overcome health issues, the entire healthcare continuum wins.


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