To maximize the potential long-term benefits of a strategically transformed supply chain function, senior management will need to integrate new partners who can help get their products to the people who need them the most.

Company executives who recognize their supply chain partners can deliver value beyond the organization will realize reduced costs, and increased speed to market.

SHIFTING CUSTOMER NEEDS

As research and development continues to advance, drug portfolios of life science firms will begin to take different shape. This year, bio- engineered vaccines and biologics are expected to account for 23 percent of the global market, up from just 17 percent in 20091. (Industry-Altering Changes Occur in Life Sciences Supply Chain By: Benjamin Gordon and Daniel Milstein of BG Strategic Advisors | October 09, 2014)

Patients are also beginning to administer drugs in their homes. Since 2002, home healthcare employment has grown 74 percent, and by 2018 is expected to increase by another 23 percent.

innovative supply chain partners are good medicineDeveloping and bringing innovative products that improve patient health to people around the world is the lifeblood of the life sciences industry.

Many companies in life science are struggling to find new ways of getting their new and existing drugs to market, and to the people who need them most, a lot faster. Senior executives need to abandon the idea that their supply chain partners and logistic providers are a purely transactional function to get new drugs to market.

David Speakman, Vice President of Marketing at TAGmedica says, “Through the use of TAGmedica’s Virtual Office, their web enabled inventory-tracking system, and Warehouse Management System Radio Beacon, the customer has 24/7 access to the inventory status of each case of protective eyewear. The customer now knows if a case was in inventory, in transit or at a trade show.”

Life science companies are adapting to distributing to more locations, including residential homes, retirement homes and community centers. Finding more economical ways to access local settings is key, and creating economies of scale is essential to ensure that numerous locations can be reached with ease.

Shifting customer needs has always been a driver for innovation. Life science distributors and manufacturers will need the services of innovative supply chain partners that can deliver one-stop shopping for all their customers shipping needs, from small packages to large freight deliveries to expedited shipping – locally and around the world.

Adapting your supply chains to changing market opportunities and customer demands, enables you to put in place dynamic planning that allows you to continually fine-tune operations.

With a full range of customized services – including Overnight, Two-Day Service, Ground Delivery, International, Freight, and Next Flight Out, executives can manage costs, and focus on what matters the most – your customers.

Integrating new business partners, like Mercury Business Services, who have the ability to implement state of the art automation enhancements such as programs that securely enable easy, yet sophisticated, shipping, tracking and reporting from a desktop delivers real value through reduced cost and time saved.

The old model was to wait until the end of the month or quarter to shift production and supply based on shipments and sales. The new model calls for more continuous, dynamic supply chain adjustments to rapidly respond to market changes. This can minimize or even eliminate shocks across the supply network.

The results include better visibility; enhanced collaboration across the value chain, including sourcing and supply, manufacturing, transportation, warehousing, and distribution; and accelerated decision-making with better analytics and support.

An example of innovative business strategies, is best exemplified

through a combination of innovative business services, technology and expertise from TAGmedica. An international market leader in the development, manufacturing and distribution of medical devices approached TAGmedica with an issue they were experiencing concerning the distribution of an adjunct product necessary in the demonstration of their device.

The primary selling tool was to invite physicians to a weekend workshop to explore how they can expand their practices by offering new revenue streams. The company conducts approximately 80 workshops per year, avoiding the summer months and December.

Typically, thirty-five to forty physicians attend a workshop (the smallest being twenty and the largest being close to one hundred). During the workshop, they demonstrate a variety of equipment and have testimonials from local doctors who have expanded their practice by offering these services.

There are extensive hands-on demonstrations during break-out sessions that allow the physicians to see the tools in action. TAGmedica was invited to help with the coordination and distribution of the supplies and marketing materials for each of these workshops.

The company was experiencing issues with the coordination of protective eyewear needed and with properly conducting demonstrations at the workshops. The Vice President of Marketing came to the realization that this was neither a core competency nor a focal point of their company and looked to an innovative supply chain partner for help.

TAGmedica was called in to study the issue and make recommendations with the understanding that if they came up with a reasonable solution they would become responsible for the program.

The results were lost, damage and missing protective eyewear is now less than 2% and $70,000 reduced freight costs per annum.

DELIVERING VALUE THROUGH INNOVATION

In his seminal work “The Innovator’s Dilemma,” thought leader Clay Christensen describes two types of product innovation: sustaining and disruptive. Sustaining innovations make products better through, say, lower prices or added features, thus sustaining the enterprise’s market position.

According to Chris Valente, Director of Sales for Mercury, ”the accurate flow of information has become nearly as important as the movement of product itself. Real time reporting of milestones along the supply chain allow for precise work flow planning and staffing. Whether in a hospital setting or a diagnostic lab, knowing what, when and how many can be critical.”

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Disruptive innovations change the product offering by redefining the value proposition. Supply Chain Innovation (SCI) can be sustaining or disruptive, too. And although process innovations tend to follow a different path than those in the product world, there are some important parallels.

For example, research indicates that sustaining SCIs improve the process, perhaps by lowering costs, shortening cycle times, and raising the quality bar. These innovations also help to sustain a company’s competitive position.

Many opportunities require deeper consideration regarding the role and impact of supply chain suppliers, and how these suppliers are positioned to add sustaining and disruptive innovation to a firms’ procurement and sourcing teams. As consumer preferences have become more personalized and complex, life science executives are asking their suppliers and logistics providers to step up to the plate. This means more customized orders, tighter delivery windows, and an increased focus on risk and vendor compliance.

Couple these factors with innovative supply chain companies like TAGmedica and Mercury Business Services that have reconfigured their service offering to be prepared to deliver more services, faster, and more often.

As order to shelf cycles tighten, companies are looking for their service providers to help them keep

inventories low, and fulfill orders at the last minute to better match consumer purchasing trends. Now and in the future, processes in the supply chain must be agile, innovative and distributive or, more clearly, flexible and interactive, ensuring high-quality delivery results. Shifting customer demand has contributed to firms looking to partners who can deliver value by reducing cost through innovative business services such as:

• KITTING: Building advanced “kits” that merge with finished packaged goods improving speed-to-shelf. Customized bio- kitting, is more than a delivery mechanism. Contents are sourced, procured, assembled and packed under ISO 13485:2003 standards. What you do know is the first major exposure to risk is when your customer actually receives your product for the first time—It must be accurate, safe, complete and on time.

• WAREHOUSING AND FULFILLMENT: Manufacturers of all shapes and sizes and across a variety of industries often struggle with space constraints and distribution difficulties. Sophisticated warehousing and distribution services, including a Warehouse Management System, as well as date and lot control capability helps customers more efficiently and effectively maintain and manage inventory. Additionally, these services free up valuable resources, streamline

distribution, increase speed to end-users as well as provide a documented process for greater visibility into stock statuses and inventory levels for better performance.

• DESIGN - PRODUCE - PROCURE - ASSEMBLE: By incorporating state-of-the-art technology with a team of dedicated experts, you can get any product to market faster and more accurately than anyone else in the industry with an innovative supply chain partner. Whether products are a simple kit, or a complex mix of options, assembly must be 99% accurate and be able to reduce turn times along with reducing assembly operations.

To summarize, supply chain management stands for the ability to cope with unforeseen events through the use of lightning-fast decision making. The implementation of this management approach requires more than just the commitment of those involved. Delivering value through innovation is not an additional component, it is essential for executives in life science to deal with the unplannable.

Life Science CEOs have come to realize that their supply chain is much more than the cost of getting products into customers’ hands. It is a corporate strategy with interactions both within and beyond the organization.

Ultimately, it is the supply chain that satisfies or disappoints their customers.

A broader definition of the supply chain—one that includes planning, information sharing, and value- adding activities, from raw material to final distribution, rather than just logistics, is the lifeblood of the life sciences industry.

And helping bring innovative products that improve patient health to people around the world is good medicine. TAGmedica (a division of The Allied Group) is a leading provider of outsourced medical kitting solutions for the life science industries. We assist with the development, production and distribution of both diagnostic and carrier screening kits for biologics companies to help with their commercialization efforts.

MERCURY BUSINESS SERVICES PROVIDES WORLD CLASS SOLUTIONS FOR ALL YOUR SHIPPING NEEDS

Keeping up with today’s shipping requirements is a complex challenge for any company. It requires deep industry knowledge and experience, a full range of business and technology offerings, world class service, and the ability to consistently and reliably deliver on customer expectations.

Our service includes Mercury’s easy-to-use ShipNow website and MercuryShip™ software. You can use ShipNow and MercuryShip™ to print labels, manage and store addresses, view shipping history, ship large groups and track shipments online. Because it can be interfaced with your accounting systems, you can also use MercuryShip™ to verify expense codes and accurately bill shipping expenses to your clients.

While Mercury’s technology is world class, life sciences at its heart is people; primarily patients. What differentiates Mercury is the ease with which a client can transition from programs to people when necessary. Experienced specialists are always available to assist in situations better served by dedicated personal interaction.

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