Understanding the Necessity of Masters Programs in Pharma Supply Chain Management
The interconnected world has brought a lot of great improvements to the corporate space, but has also raised a host of new challenges. Though businesses are often able to trade and collaborate more quickly, the result is often greater complexity—and with it, a heightened need for precision, multi-system management, and shifts in prioritization. Perhaps nowhere is this more evident than in the pharmaceutical industry. Globalization has allowed research labs to produce medicinal drugs faster and better than ever before. In so doing, however, it has also opened the field up to a range of new issues, from competition to direct consumer care, that rarely entered the spectrum in the slower times of the past. Business schools are responding with specialized supply chain management programs, which are growing in popularity as more and more industries see the need for improved, more market-ready skills.
There are two key parts of any supply chain: the actual production of a specific product, and the delivery of that product to the end consumer. The growth of the Internet has led to a booming competitive marketplace when it comes to the first prong; with respect to the second, in many ways it has empowered the consumer. Supply chain experts need to understand—and manage—both elements effectively in order to succeed in today’s hyper-fast market. This often boils down to information control.
“The organizations that make up the supply chain are ‘linked’ together through physical flows and information flows,” Robert Handfield, a professor of supply chain management at North Carolina State University, explains. “Physical flows involve the transformation, movement, and storage of goods and materials. They are the most visible piece of the supply chain. But just as important are information flows,” he says. “Information flows allow the various supply chain partners to coordinate their long-term plans, and to control the day-to-day flow of goods and material up and down the supply chain.”
The implications tend to be profound for industries across the board, but companies that produce direct consumer products—prescription medicines being one of them—often feel the effects the most sharply. Pharmaceutical manufacturing is a complex process that necessarily involves a lot of key players. Formulating the drug, while arguably the most important part, is by no means the conclusion. Labs around the world often bid for production rights, then source ingredients and key additives from providers on nearly all continents. The finished product must be packaged, labeled, and shipped, usually in compliance with a host of regional laws. Then, of course, comes the question of what to do with excess or expired products, and how to dispose of them safely. The rise of gray market pharmaceutical sales as well as the growing threat of counterfeit and expired drug sales over the Internet have made knowledgeable oversight more important than ever before.
“As scientific advances enable the industry to move from a ‘one-size-fits-all’ approach to care, to one of segmentation, personalisation and wellness, so the supply chain will need to evolve,” PricewaterhouseCooper says of the changes to pharma supply chain management. “The supply chain of the future will be built around flexibility, responsiveness and reliability shifting the supply paradigm from a stock-based model to an order-based model.” This tends to require precise knowledge and a keen awareness of current trends.
As the pharmaceutical industry continues to grow, individuals who are able to both recognize the risks and capitalize on the benefits of this new order will be increasingly in demand. The Center for Healthcare Supply Chain Research, an independent trade association, estimates that specialty pharmaceuticals and smaller startups will play an increasingly vital role in the marketplace. “It is predicted that by 2016, eight of the top 10 branded drugs sold will be specialty pharmaceuticals,” the Center said earlier this year. Presumably, these new ventures will need to hire talent that is both savvy to the ways of the industry and well versed in the modern supply chain. Graduates of specifically branded supply chain MBA programs will be able to fill this need in a unique way.
Of course, supply chain expertise is just as crucial to established ventures. Amgen, which produces a range of both prescription drugs and over-the-counter supplements and medications, is one example of a company that has leveraged an understanding of new information systems to improve and expand on its supply chain performance. In response to industry changes, Amgen in 2011 launched an intensive campaign to refine and simplify its hugely complex web of contracts and production arrangement.
The results were, by most accounts, quite impressive. “By centralizing elements of its planning process and deploying the appropriate advanced planning tool, Amgen can now quickly model the impacts of various ‘what-if’ scenarios and extend these analyses to multiple planning levels across the entire supply network,” the Kinaxis Life Sciences Newsletter reported in 2012. Not only is production and disposal more regulated, but consumer safety and concern has also been improved.
More and more respected business schools are offering MBAs with either a deep focus on or an actual certification in supply chain management. When it comes down to it, there is simply more to learn and apply in this sector than ever before. While we still may be but approaching the crest of the information age wave, the time has never been better to jump in. The expertise has a defined market need, and the training will equip tomorrow’s leaders to make a difference to consumers and companies both.