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How is outsourcing impacting IT investments in the pharma supply chain?

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Looking ahead, it is clear that competition will drive the formation of value added networks as well as supply chains differentiated by product and region. R&D will continue their trend of outsourcing to contract research organizations (CROs) and the manufacturing of medical devices and pharmaceuticals will also continue their shift toward outsourcing; for example, pharmaceutical contract manufacturing organizations (CMOs) are expected to grow from USD 32 billion in 2011 to USD 60 billion by 2018 (Scrip Insights 2012 and Morrison 2012)

Supply-chain visibility is an important if not essential enabler for the more advanced outsourcing approaches; therefore, IT investments and outsourcing must be considered simultaneously. Differentiated operating models with a broader spectrum of service providers are being designed based on product characteristics; For example, in specialties there is an increasing build-up of ownership (chain of custody) down to the point of application (direct-to-hospital/ pharmacy).

In future posts I’ll continue to discuss the changing pharma supply chain, but if you can’t wait I suggest you download the report, The Top Ten Trends Transforming the Pharmaceutical Supply Chain.

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Bruce Jacquemard