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Mitigating Risks in the Pharma Supply Chain With Third-Party Logistics

The pharmaceutical supply chain involves many complex steps for delivering medications and vaccines to patients. This dynamic process involves multiple stages, including manufacturing, distributing and keeping up with supply and demand. Strategic coordination and collaboration between manufacturers, suppliers, distributors and transportation partners is critical for maintaining a healthy supply chain.

For efficient pharmaceutical supply chain management, companies must be able to identify potential or actual risks to help offset disruptions and delays. Partnering with an experienced third-party logistics (3PL) provider enables pharmaceutical businesses with outsourced tools to combat these obstacles. A customized 3PL solution can promote future growth by improving customer service and satisfaction.

Common Risks in the Pharma Supply Chain

The pharmaceutical industry faces many supply chain-related disruptions that can significantly affect your company’s reputation, customer satisfaction and bottom line. Here are the most common challenges in the pharma supply chain.

1. Improper Stock Levels

Because many medicines and biologics cannot be stored for extended periods of time, it can be challenging for companies to maintain proper inventory levels. Understocking and overstocking can result from many issues throughout the supply chain, including inadequate information sharing, that negatively impact operations.

This can result in each supply chain partner underestimating or overestimating product demand. Combined with the perishability of drugs as well as medical urgency, companies may find it difficult to maintain resilience without end-to-end transparency from trusted logistics sources.

2. Temperature Control Failures

Many pharmaceutical products, including antibiotics, vaccines, insulins and other medicines, must be kept at a specific temperature throughout the entire supply chain process. Insulin, for example, must be refrigerated with ideal temperatures of 36 to 46 degrees Fahrenheit.

Otherwise, these drug products may be damaged or lose their effectiveness, sterility or physical form. Improper handling or extreme variations in temperature can render a shipment unsafe for use — sometimes referred to as cold chain losses.

3. Turnaround Times

In the pharma industry, turnaround time failures directly impact patients in need of medication, which can also result in penalties for partners who fall short. A supply chain compliance measure known as on-time-in-full (OTIF) delivery is a top priority for suppliers, and gauges their performance in delivering the right products on time.

However, poor coordination that leads to damaged, unusable or delayed stock makes it challenging for suppliers and carriers to meet fast demands. A fragmented supply chain with minimal visibility means each link becomes isolated and ill-equipped to actively respond to interruptions.

4. Maintaining Compliance

Compliance is a critical aspect of the pharmaceutical industry. Pharma manufacturers and shippers must adhere to strict regulations and guidelines, such as:

  • Transit temperature or humidity
  • Packaging
  • Recordkeeping
  • Labeling and handling protocols
  • Product safety
  • Public safety

Supply chain managers and directors must also comply with the National Institute of Standards and Technology (NIST), which outlines measurements and standards for quality assurance and traceability. These rigorous requirements for products, procedures and documentation can increase medical supply chain challenges and risk of errors.

Additionally, pharma suppliers must keep up with changing regulations. Navigating compliance in this field can be extremely complex, particularly when handling other priorities like storing products and fulfilling orders.

Benefits of Using a 3PL for Pharma Supply Chain Risk Mitigation

Partnering with a trusted, experienced 3PL can help your pharmaceutical company mitigate risk and maintain regulatory compliance. You can rely on third-party logistics to solve your unique challenges with various customized services that offer the following advantages.

Cost Reduction

Third-party logistics companies like Crown LSP Group can drive cost savings. Because many supply chain links rely on manual processes, it can be challenging to move products quickly — which often leads to higher costs. Additionally, inefficiencies can cause delays, while strained budgets make it difficult for your business to invest in the necessary logistics equipment. A 3PL partner can help you optimize efficiency and reduce costs with sophisticated resources and an extensive network of logistics professionals.

3PL distribution and logistics solutions also enable cost savings by allowing you to outsource your warehouse operations, staff, technology infrastructure and transportation equipment. They may even be able to assist with negotiating lower rates with carriers and optimizing transportation routes to maximize your budget.

Improved Efficiency

A trusted 3PL solutions provider supports many aspects of your supply chain responsibilities, including improving efficiency and accuracy. Outsourced logistics companies regulate the transportation of your products and ensure smooth operations in the supply chain. With quick product shipping and seamless order fulfillment, you can improve operational efficiency and meet customer needs.

Comprehensive solutions contribute to business agility and flexibility, empowering your company to carry out tasks faster. Additionally, a 3PL partner can help you identify gaps and risks in your supply chain and help resolve those challenges before they impact your customers.

Increased Scalability

Meeting demand in the pharmaceutical industry can be particularly challenging, especially in the event of a global crisis where medications and vaccines are urgently needed. Outsourcing third-party logistics enables your pharma company to scale as needed in response to market demands and fluctuations.

This scalability can help you maintain proper inventory levels and remain flexible in an ever-changing environment. 3PL partners like Crown LSP Group also offer customized solutions based on your changing needs, so you can choose which services benefit you.

Maintaining Compliance With Regulations

Working with a 3PL partner means you gain access to expertise in all areas of logistics. Because the pharmaceutical market faces unique challenges, an experienced solutions provider like Crown LSP Group can support product safety and compliance.

Whether you require quick delivery with specialized shipping, storing medications in temperature-controlled settings or transloading, your 3PL partner can assist you in managing these complexities.

Factors to Consider When Selecting a 3PL Partner for the Pharma Industry

Outsourcing your logistics and warehousing operations to a 3PL connects you with many valuable services. Here are some qualities to look for to help you select the right 3PL provider for your pharmaceutical company:

  • Experience: An experienced, reliable provider with a trusted reputation — like Crown LSP Group — will better serve you and your customers. Their reputation and years of experience signify they can help you solve pharma supply chain challenges. They should also know the ins and outs of distribution and logistics, and have strong industry connections that benefit your business.
  • Technology capabilities: Many supply chains rely on automation to achieve efficiency and accuracy. An innovative 3PL partner has the sophisticated technology and systems to respond quickly to issues with integrated software and real-time production insights.
  • Compliance: It’s critical for your 3PL partner to handle regulatory compliance with the utmost care. An experienced partner can address unique and specialized pharma requirements, including extensive monitoring, tracking and cold storage. We proudly maintain compliance with many industry-specific organizations, including the Food and Drug Administration (FDA).

Leverage Tailored 3PL Solutions From Crown LSP Group

As a company in the pharmaceutical industry, you know how challenging it is to maintain compliance while managing other business priorities. Outsourcing to a 3PL partner like Crown LSP Group allows you to access tailored supply chain management solutions. It’s our goal to help your company optimize efficiency and mitigate risks so you can focus on core operations.

As a trusted partner in supply chain operations, Crown LSP Group offers logistics, warehousing, transportation, order fulfillment and inventory management services. Request a quote or contact us today for more information about how we can serve you.