Pharma 2020:Supplying the futureWhich path will you take?www.pwc.com/pharma2020Pharmaceuticals andLife SciencesPharma 2020: Supplying the future 1Table of contentsIntroduction 2The times they are a-changin’ 3• New product types• Live licensing• The increasing emphasis on outcomes• New modes of healthcare delivery• The growing importance of the emerging markets• Greater public scrutiny• Environmental pressures• The collective impact of these trendsRemoving the roadblocks 10• New development technologies• New manufacturing technologies• New distribution technologies• New patient interface technologies• Greater collaborationChoosing among the options 17• The virtual manufacturer• The service innovator• The low-cost provider• The proft centreManaging the movement of information 24Restructuring the asset base 25Conclusion 26References 282 PwCUnfortunately, it’s a link that frequentlydoesn’t work very well. Most pharmacompanies have complex supply chainsthat are under-utilised and ineffcient.Worse still, they are ill-equipped to copewith the sort of products that are comingdown the pipeline. By 2020, many of themedicines the industry makes will bespecialist therapies that require totallydifferent manufacturing and distributiontechniques from those used to producesmall molecules.In short, the pharmaceutical supply chainneeds a radical overhaul, and we predictthat it will undergo three key changes overthe next decade:• It will fragment, with different modelsfor different product types and patientsegments• It will become a means of marketdifferentiation and source of economicvalue; and• It will become a two-way street, withinformation flowing upstream to drivethe downstream flow of products andservices.We’ve identifed four potential supplychain options from which pharmacompanies can choose. Those that focuson specialist medicines can either delegateall their manufacturing and distributionto trusted contractors or build serviceoriented supply chains to enhance theirbrands. Those that focus on mass-marketmedicines can either become low-costproviders or build supply chains thatgenerate a proft by servicing both internaland external customers.We’ll discuss the main trends dictatingthe need for a new approach to themanufacturing and distribution ofmedicines, together with some of thetechniques and technologies that will helpthe industry make the necessary changes,in more detail in the following pages. We’llalso look at the key characteristics of eachof the four routes we’ve identifed, and theimplications they carry.IntroductionThe pharmaceutical industry is experiencing major upheavals, asPwC* noted in earlier Pharma 2020 papers. Many companies haveresponded by trying to discover, develop and market medicines moreeffciently, but they’ve invested relatively little effort in reconfguringtheir manufacturing and distribution operations to date. Yet the supplychain is just as important; it’s the link between the laboratory and themarketplace.* “PwC” refers to the network of member frms of PricewaterhouseCoopers International Limited (PwCIL), or, asthe context requires, individual member frms of the PwC network.Pharma 2020: Supplying the future 3Figure 1: The supply chain is the backbone of a pharma companyInformation SystemsPlanning and CollaborationNew ProductPeople and SkillsDevelopment& InnovationActivePharmaceuticalIngredientManufacturingSecondaryManufacturingand PackagingDistribution PatientWholesaler PharmacyDirect-to-pharmacySource: PwCA supply chain is the means by whicha company transfers its products fromdevelopment to the marketplace in orderto sell them and generate a proft. Itincludes all the organisational, operationaland value-adding activities needed tomanufacture those products and get themto the customer. So, for a pharma company,it covers everything from new productdevelopment through to delivery to thehospital, retail pharmacy or patient (seeFigure 1).Some companies have superb supplychains. Fashion retailer Zara is renownedfor the speed and agility of its supply chain,for example.1 Apple, Procter & Gamble,Cisco Systems and Wal-Mart also rankamong those regarded as leading examples.2However, most pharma companies havesupply chains that are neither flexible norcost-effective.When the ‘blockbuster’ paradigmprevailed, this wasn’t a serious problem,but the situation is now changingdramatically. Generic competition hasalready dented Big Pharma’s revenues – atrend that will continue, as the patents onproducts with sales of more than US$267billion expire over the next six years.3 Sothe economies of scale the industry leadershave traditionally enjoyed are rapidlydiminishing.Many pharma companies have as a resultstarted refning their supply chains. Butmost of the changes they’ve introducedhave been short-term measures toaddress immediate challenges like therationalisation of larger manufacturingnetworks as a result of acquisitions. This isreflected in the progress – or, rather, lack ofit – they’ve made in recent years.The times they are a-changin’Asset utilisation rates have improved.Between 2004 and 2009, overallequipment effectiveness in packagingincreased from 36% to 51%, for example.Quality has also risen, with the percentageof rejected batches falling from 1.00%to 0.74% over the same period. Butaverage set-up times have increased from79 minutes to 93 minutes, and the vastmajority of pharma companies are still farfrom having any kind of ‘continuous flow’,smooth production scheduling or make-toorder manufacturing. Instead of producingon demand, they must hold large quantitiesof inventory, which drives up their workingcapital and overheads.44 PwCEven more importantly, few, if any, pharmacompanies have supply chains capableof meeting tomorrow’s needs. Numerousforces – both internal and external – arereshaping the environment in whichthe industry operates, with profoundconsequences for the way in which itmanufactures and distributes its products(see Figure 2).Figure 2: Numerous forces are dictating the need for a different sort of supply chain1 New product types• More complex manufacturing and distribution processes• Different supply chains for different product types• Shorter product lifecycles2 Live licensing• Incremental launch of new medicines• Ability to scale up and down very rapidly• Step changes in the revenue curve3Increasingemphasis onoutcomes• Expansion into health management service• Leaner and more adaptable cost structure that preservesgross margins at every stage of the product lifecycle4 New modes of healthcare delivery• Blurring of the boundaries between primary and acutecare• Much wider distribution network• Demand-driven manufacturing and distributionprocesses5Growingimportance ofemerging markets• Offerings designed for patients in emerging markets• More widely dispersed and more robust supply chain6 Greater publicscrutiny• Heavier regulation• Robust risk assessment and risk-managementcapabilities across the extended supply chain7 Environmentalpressures• Sustainable eco-friendly processes• Relocation of plant to less vulnerable regionsSource: PwCPharma 2020: Supplying the future 51. New product typesPharma’s portfolio is changing substantially.Industry analysts predict that, by 2016,bioengineered vaccines and biologicswill account for 23% of the global market(measured by value), up from 17% in 2009.5The product base will become even morediverse, as advances in nanotechnology,tissue re-engineering, stem cell researchand other such disciplines start to yield fruit(see Figure 3).However, many of these new therapiesand the devices used to deliver them willrequire more complex manufacturing anddistribution processes than conventionalchemical entities. Indeed, somepersonalised medicines and poly-pills willhave to be ‘fnished’ at the pharmacy orpoint-of-care (see sidebar, New drugsand devices). Such challenges will notbe enough to prevent product lifecyclesgetting shorter, though; greater competitionboth from similar new products and fromtotally different product types will reducethe period of exclusivity all but the mostpersonalised therapies enjoy, as it has in thecase of conventional medicines.Figure 3: By 2020, Pharma will be making a much more diverse range of productsMainstream technologies already happening Gene/Cell/Tissue technologies Nanotech-related technologiesKEY2010 2012 2015 2020Fixed dose combinationsRecycling existing drugswith greater expectedhealth benefitsTherapeutic monoclonalsNew antibody treatmentsfor cancer andinflammatory disordersBiomarkersFirst wave of clinicallyvalidated biomarkersNano-pillsOral imaging diagnostics‘pills’ for gastrointestinal andother conditionsGene-based therapiesFirst gene-based therapiesfor diseases such asoncology and cardiovascularHuman cell therapiesFirst stem cell therapies fordiabetes, Alzheimer’s disease,Parkinson’s disease andvascular injuriesTissue engineeringFirst tissue engineering orxenogenic therapiesPharmacogenomicsFirst fully integrated PGxproduct propositionsImagingBetter real time imaging fordiagnosis, monitoring andtreatment of multiple diseasesNano-carriersTargeted drug deliverysystems for Alzheimer’sdisease, Parkinson’sdisease, cancer and strokesSource: PwCNew drugs and devicesBiologics are in general more susceptibleto impurities in the productionprocess and damage during shippingthan chemical entities. Making geneand tissue-based therapies is evenmore diffcult. Each sample must beindividually extracted, propagated,prepared and tested before it can beadministered, so it must be treated as aseparate manufacturing lot and fnishedat a location near the patient.Many of these specialist treatments willalso need novel delivery devices, since itis diffcult to produce oral formulationsof large molecules. Micro needles,magnetically targeted carriers, nanoparticles, polymer capsules and multilayered medicated patches are likely topredominate, but such devices are muchmore complex than those that are usedtoday.6 PwC2. Live licensingThe launch process will also becomemuch more incremental, as new methodsfor assessing, approving and monitoringmedicines emerge. At present, themarketing applications for most newmedicines are either approved or rejected;the supply chains for manufacturing anddistributing them are designed to supportpeak sales volumes; and the revenues theygenerate climb in a relatively simple curve.But the binary system of authorising newmedicines is becoming more graduated.The European Medicines Agency (EMA)and US Food and Drug Administration(FDA) introduced conditional approvalsfor certain products some years ago.6Both agencies are also placing much moreemphasis on post-marketing surveillance,and we believe that the current systemwill eventually be replaced by a systemin which new therapies are granted ‘livelicences’ contingent on further testingto confrm their safety and effcacy indifferent patient populations.7Once this happens, the ‘big bang’ launchwill give way to a phased approach inwhich demand for a new product risesas the licence is extended. The intervalbetween the initial launch and peaksales point will thus be much longer; therevenue curve will climb more slowly; andthe payback period for capital expenditureon plant and equipment will be moreprotracted (see Figure 4). So, rather thanmaking a large upfront investment in asupply chain designed to cope with peakvolumes, any company launching a newmedicine will need to build a supply chainthat can be rapidly adjusted as the licencealters.Figure 4: The revenue curve will climb more slowly, when ‘live licences’ replacethe binary system of approving new products Peak Sales80%40%Understandingthecost of capital andimpact on margins iscritical to managingproduct profitability RevenueTimeSource: PwCOption 1Build one facility to accommodate peak salesAdvantages:• Low scale-up risks.• Big site drives operational effciencies.Disadvantages:• Large capital outlay for un-proven demand.• Low utilisation during growth of the product.Option 2Adopt a modular manufacturing platformscaling up to support each volume plateauAdvantages:• Capex linked to known market demands.• High site utilisation.Disadvantages:• Cost and risk of commissioning more sites.• Many small sites increases cost base.Pharma 2020: Supplying the future 7Financially stretched governments andhealth insurers are simultaneouslybecoming much more demanding;they now want clear evidence that themedicines they buy are really effective.This has huge implications for Pharma.The industry will not only have to managethe manufacturing and distribution ofmedicines and companion diagnostics, itwill also have to ensure that patients getthe most from the therapies they receiveby supplementing its products with a widerange of supporting services.The ability to provide demonstrable valuefor money will thus become a criticaldifferentiating factor, and the supply chainwill play a key part in providing that valueby commissioning and supervising aspectsof the services patients need to managetheir health.The drive to cut costs and improve outcomesunderlies several other changes takingplace in healthcare delivery, with equallymomentous consequences for the industry.Most of the OECD countries have beentrying to reduce reliance on hospitalsand specialists since the 1980s.8 Selfadministration of medicines is also on therise, as patients are encouraged to take amore active role in managing their own care.Both these trends will continue as clinicaladvances provide better medicines foracute conditions and patients become moreempowered. Many diseases which must atpresent be treated in hospital will then betreated at home.But migrating from a system in which careis provided in a relatively small number ofhospitals, clinics and surgeries to one inwhich care is provided through a diffusenetwork of nurses and community carershas enormous ramifcations. Pharma willneed to distribute its products to manymore locations, including patients’ homes.It will therefore have to harness the mosteffcient ‘fnal mile’ distribution networksin order to deliver medicines to the door aseconomically as possible.The digitalisation of healthcare delivery,with greater use of electronic healthrecords, e-prescribing and remotemonitoring, will reinforce the drive topush healthcare into the community.However, it will also provide Pharma withone of the key components needed tomake the transition. E-prescriptions areeffectively point-of-sale data. Access tothis data will enable pharma companiesto build demand-driven supply chains inwhich healthcare packages for differentpatients are assembled at ‘super hubs’before being delivered to their homes.By 2020, information about patients andthe medicines they need will thus be asimportant as the products themselves.3. The increasing emphasis on outcomes4. New modes of healthcare delivery8 PwCThe growing importance of the emergingmarkets will accentuate these challenges.Although patients in the developingeconomies are becoming more prosperous,they typically pay more than half the costof their medicines themselves – and fewcan afford to pay as much as patients in themature economies.9 Moreover, the choicesthey make are often based on differentvalues from those that influence thedesign of products and services intendedfor consumption in the developed world.Cost and the ability to buy on a daily orweekly basis are more important thanconvenience, for example.If Pharma is to market its productseffectively in the developing economies,it will have to understand the needs ofpatients living in these countries andtailor its offerings accordingly; and it canlearn from the medical device industry inthis regard (see sidebar, Designs for thedeveloping economies).10 It will alsohave to build a supply chain that is bothmore geographically dispersed and moresecure. The number of recorded cases ofcounterfeit, stolen or illegally divertedmedicines has already soared nearly ninefold since 2002.11Designs for the developingeconomiesSeveral medical device companies arealready designing and manufacturingproducts specifcally for people livingin the developing economies. FreeplayEnergy has, for example, developedfoetal heart rate monitors and pulseoximeters that are driven by humanpower and designed to cope withharsh conditions. Mindray MedicalInternational, one of China’s biggestmedical equipment manufacturers,also specialises in making inexpensivepatient monitoring and life supportdevices. And cardiologists at India’sCare Hospitals have designed cheapheart valve replacements, minimisingthe number of disposable parts to keepcosts down. Pharma can learn fromsuch role models. It can, for instance,develop economical formulations andstripped-down services for patientswho can’t afford its most expensiveofferings.5. The growing importance of theemerging markets6. Greater public scrutinyIn fact, by 2020, the ability to manage riskand compliance throughout the supplychain will be more crucial than ever before.While globalisation is increasing therisks, greater public awareness and morediligent enforcement are raising the bar.In 2009, for example, the FDA recalled arecord 1,742 medicines. A single companyaccounted for more than 1,000 recalls but,even when these are stripped out of thepicture, the number of recalls still rose by50% year on year.12Other administrations are also tighteningthe rules. The Indian governmentrecently passed a law mandating the useof track-and-trace barcodes on all drugsmeant for export, with effect from July2011, following reports that Chinesecounterfeiters were selling fake medicineslabelled ‘Made in India’ in several Africancountries.14Pharma 2020: Supplying the future 9The Green agenda presents otherdiffculties. All pharma companies alreadyoperate under strict environmentalcontrols, for obvious reasons. But theseregulations are likely to become eventougher, given the international drive tocurb carbon emissions. Taxes on waterconsumption are also likely to rise, aspopulation growth, increased farming,rapid urbanisation and climate changeexacerbate the shortage of fresh water (seesidebar, Water is the new gold).15However, many of the assets pharmacompanies own are designed to supportspecifc manufacturing processes– processes that typically consumeconsiderable amounts of energy andwater. If the industry is to reduce itsenvironmental footprint, it will have toadopt new, more eco-friendly processesand that will require a substantialinvestment in new equipment.Indeed, some companies may have torelocate some of their production facilitiesto completely different places. Globalwarming is changing the world’s weatherpatterns and many of the traditionalcentres of pharmaceutical manufacturing,such as Singapore, lie in regions thatwill become more vulnerable to extremeweather events. Even if it proves possible toengineer a better climate – e.g., by lockingup the ice caps or using plants to suck upexcess carbon dioxide – geoengineeringexperts widely agree that the effectswould be limited. Such measures would,at best, reduce peak temperatures duringthe transition to a low-carbon world.16But relocating a plant to a new country orregion is a complex business; numerouspolitical, fnancial and commercial factorsmust be looked at, as we indicated in“Pharma 2020: Taxing times ahead.”17Water is the new goldAbout 20% of people live in countriesthat don’t have enough fresh water, butthe situation will get much worse overthe next decade. The global populationis projected to rise from 6.8 billionto 7.6 billion by 2020. The amountof food needed to sustain mankind isthus increasing – and farming alreadyaccounts for about 70% of the world’stotal fresh water consumption. Rapidurbanisation is also driving up demandfor safe drinking water and sanitationfacilities, and environmental changeslike deforestation and global warmingare exacerbating these pressures.Water shortages will have a seriousimpact everywhere. The UnitedNations predicts that, by 2025, 1.8billion people will be living in regionswhere water is very scarce, while5 billion could be living in ‘waterstress’ conditions. The problem willbe particularly acute in China, India,sub-Saharan Africa, South Asia andsome parts of Latin America. But evencountries in more temperate zoneswill suffer. One recent study suggests,for example, that large swathes of thesouth-western US will be at risk ofwater shortages by mid-century.7. Environmental pressuresThe collective impact of these trendsTo sum up, the current model formanufacturing and distributing medicinesisn’t ft for Pharma’s future needs, as manyindustry executives recognise. The highmargins that made it feasible to tie upcapital in large stocks of raw materials andfnished goods are ending. Most companiesalso have asset bases that are ill-suitedto produce the sort of therapies that arenow in the pipeline or to cope with newenvironmental regulations, so they’ll haveto sell or re-engineer much of their existingplant.The change in the industry’s remit has evenmore fundamental implications. Pharmacompanies will have to manage a vastnetwork of service providers, as well asmanufacturing and distributing their ownproducts. They will also have to acquire amuch deeper understanding of patients.In a world where outcomes count foreverything, it’s not molecules that createvalue but, rather, the ability to integratedata, products and services in a coherentbusiness offering. Understanding thisshift of emphasis from products to patientoutcomes is critical; those frms that candevelop and supply integrated productservice packages will be able to deliversignifcant benefts to every stakeholder inthe healthcare value chain.10 PwCFigure 5: Signifcant opportunities for improving the supply chain existInternal andexternalcollaboration‘Assembly line’ production(disposable components, Quality byDesign & PAT) and continuous manufacturingDistributionstructure andtechnology‘Self service’ (the patientas an integral componentof the supply chain)Dynamic sourcing,micro-processingtechnologies andnumbering upFlexibleproductionFlexibleproductionComputer modelling(virtual process development,facility design and validation,Quality by Design)Formulations that areeasier to manufactureNew ‘patientinterface’technologiesAlignedperformancemanagement Plan ning and CollaborationPeople and SkillsInformationSystemsRawMaterials/IntermediatesAPISecondary/Packaging Distribution ServiceE-prescribing (POSdata for supplychain planning)R&DSales & MarketingPatientPatientSource: PwCTimely access to various emergingtechnologies will help Pharma manufactureand distribute its products more effciently.Some of these technologies will enableit to build quality into its manufacturingprocesses, while others will enhance itsthroughput or facilitate collaboration torealise economies of scale (see Figure 5).Removing the roadblocksPharma 2020: Supplying the future 11Virtual process design and validationMeanwhile, computational modellingwill enable Pharma to design and validatemanufacturing processes virtually, usingQuality by Design (QbD) principles. In-lineprocess monitoring via process analyticaltechnologies (PAT) will generate the dataneeded to validate these models and secureregulatory approval.The FDA has already published a draftguidance in which it proposes replacing‘three-batch validation’ with a three-stagemethodology that involves designing asuitable process, using the knowledgegained in development and scale-up;ensuring the process is capable ofreproducibly manufacturing commercialbatches; and validating it continuouslyduring routine production.19 By 2020, thisapproach is likely to be the norm.The conventional process of scaling up willalso be replaced by ‘numbering up’ – i.e.,using microreactors in parallel arrays.Numbering up has several signifcantadvantages over traditional techniques.It dispenses with the need for costly andtime-consuming studies to devise a processfor scaling up chemical reactions, sincethe process that was used to produce a fewgrams of product in the laboratory is thesame one that is used to synthesise largerquantities. In addition, using microreactorsmakes it much easier to control keyparameters and thus improve yields.During the past 60 years, audio technologyhas evolved from the vinyl record to theiPod, but the way in which medicinesare delivered has stayed much the same.Compressed tablets containing a mixtureof active ingredients and excipients are stillthe most common dosage form.However, more sophisticated drug deliverytechniques will provide the means withwhich to create formulations that are easierto manufacture – e.g., powder in vials andliquid droplets on blank tablets.Researchers are also working on the ‘holygrail’ of oral biologics, and industry expertsbelieve it will eventually be possible toproduce stable, pill-based versions ofsome proteins (see sidebar, Biologics in abottle).18Using formulations that can be moreeasily manufactured will enable Pharmato minimise its investment in product andprocess development until the later stagesof the product development lifecycle, whenit’s easier to estimate the potential value ofnew products. And the development of oralbiologics will eliminate the need for coldchain distribution of such therapies.1. New development technologiesFormulations that are easier to manufactureBiologics in a bottleOne of the main obstacles indeveloping oral biologics is thefact that proteins break down inthe gastrointestinal tract and ceaseto be active. Some proteins alsohave a very narrow therapeuticindex and must be delivered indoses too precise to be orallyadministered. Nevertheless,numerous companies are trying tocreate pill-based proteins.Bangalore-based Biocon is testingan insulin pill in the US and India,for example, with promisingpreliminary results. Meanwhile,Novo Nordisk is conducting aPhase I study of an oral insulinpill formulated using MerrionPharmaceuticals’ gastrointestinalpermeation enhancementtechnology. Several oral biologicsfor the treatment of autoimmunediseases are also in the pipeline,including a new class of drugscalled JAK inhibitors. One suchinstance is tasocitinib, which wasdeveloped by Pfzer and is now inPhase III trials.12 PwC2. New manufacturing technologiesFlexible productionContinuous processing and automationVirtual engineering will not only acceleratethe validation of new processes, it willfacilitate the rapid reconfguration ofexisting manufacturing lines for differentproducts. With flexible processes andminiaturised, modular components thatcan be quickly connected or disconnectedlike pieces of ‘Lego’, it will be relativelyeasy to alter the order in which specifcunit operations are performed. Widespreaduse of disposable technologies willlikewise reduce changeover times (and theconsumption of clean water).Collectively, these improvements will allowpharma companies to create differentsupply chains for different product typesand markets, manage sudden shiftsin demand such as the step changesassociated with live licensing and reducetheir manufacturing costs. They shouldsimultaneously help the industry fulflits social responsibilities, including theneed both to pioneer more sustainablemanufacturing processes and to producemedicines the entire world can afford.By 2020, most medicines will also bemanufactured continuously. Processtomography and other such technologieswill enable companies to capture real-timedata on critical processes, develop complexmultivariate models and automaticallycompensate for unexpected processdisturbances. Process data generatedduring the development phase will beused to ‘teach’ process control systemsto respond to process disturbances evenbefore commercial manufacturing begins.Meanwhile, advances in colloidal and foamsystems will facilitate the micro-processingof active pharmaceutical ingredients(APIs).Micro-containers with embeddedsuperparamagnetic nano-particles can betreated with an alternating magnetic feldto release materials encapsulated in bubbleswithin the material and thus converted intomicro-reactors for the effcient productionof thousands of individual doses of tailoredbiological products.20Micro-processing will even make it possibleto formulate some medicines and poly-pillsat the point at which they are dispensed.Several companies have already startedproviding pharmaceutical compoundingservices, one such instance being Fagron, asubsidiary of the Belgian Arseus.21 But, by2020, the pharmacist will be able to ‘mix’medicines individually on the premises,using validated formulation equipment –much as DIY stores mix paints to producecustomised colours.Pharma 2020: Supplying the future 13Transgenic productionSimulation and automation aren’t the onlytools to hand; transgenic engineering offersa fundamentally different way of producingmany therapeutic proteins. The processinvolves inserting foreign genes into hostanimals or plants so that they expressproteins they wouldn’t otherwise expressand then using them to ‘manufacture’ largequantities of these proteins.GTC Biotherapeutics has alreadydemonstrated the commercial viabilityof transgenic production techniques withits recombinant human antithrombinATryn, which is extracted from the milk ofgenetically modifed goats.22Other examples include the Netherlandsbased Pharming, which uses transgenicrabbits to make the C1 inhibitor protein.23Transgenic production has severalsignifcant advantages over moretraditional methods for producingtherapeutic proteins, such as mammaliancell culture and bacterial systems.It requires substantially less capitalexpenditure, is easy to scale up or downin line with demand (by increasing ordecreasing the size of the herd) and canbe undertaken in rural environmentswhere the infrastructure for more hightech manufacturing techniques may not beavailable.3. New distributiontechnologiesJust as new technologies are emergingto help pharma companies manufacturea wider and more complex range ofmedicines, so new technologies areemerging to help them distribute thosemedicines. Cloud computing will providethe information platforms they need toshare data securely and economicallywith suppliers around the world, analysethe data very rapidly and respond tosudden changes in supply and demand,while advanced tracking technologieswill enable them to monitor productsfrom the factory gate to the patient – anincreasingly important feature, as theindustry manufactures more biologics withhigh unit values and specialist deliveryrequirements (see sidebar, Fingering thefakes).24Fingering the fakesVarious new tracking technologiesare in the works. One suchexample is the ‘bokode’ – akind of data tag that can holdfar more information than aconventional barcode and be readfrom much further away. DNAlabelling could also provide a wayof fngerprinting proteins anddetermining where they have beenmanufactured, if the problemswith selecting a DNA fractionthat doesn’t affect a protein’sperformance can be overcome.DNA fngerprinting has alreadybeen used to identify ‘counterfeit’foods; researchers in Spainrecently used a technique calledforensically informative nucleotidesequencing to test nine commercialseafood samples containing sharkmeat and isolate those that wereincorrectly labelled.14 PwCFigure 6: By 2020, the pharmaceuticals, medical devices and healthcare services supply chains will be fully integratedIntegrated Supply ChainPharmaceuticals + Medical Devices + Healthcare Services Healthcare Services Supply ChainMedical Devices Supply ChainPatientPharmaceutical Supply ChainPharma PatientIntermediatewarehouseHospitals &PharmaciesPrimary care (Doctor or hospital)PatientSecondary care (Hospital or community care) ManufacturersPatientCurrent Situation Situation in 2020Areas of full supply chain visibilityPharmaManufacturersPrimary care(Doctor orHospital)Secondary care(Hospital orcommunity care)Intermediatewarehouse orwholesalerHospitals &PharmaciesIntermediatewarehouseIntermediatewarehouses orwholesalersHospitals &PharmaciesHospitals &PharmaciesSource: PwCNew ‘patient interface’ technologies arelikewise being developed, some of whichwill bring pharma companies closer topatients than ever before. One instance isthe prototype chip and receiver devised byProteus Biomedical, which records exactlywhen a tablet is metabolised (see sidebar,Tablets go high-tech).25By 2020, there will be many such patientinterface technologies on the marketand the information they generate willhelp patients manage their health moreeffectively, as well as allowing healthcareproviders to monitor their compliancein real time. But they will also providepharma companies with informationthey can use both to design more robustproducts and services, and to develop moreaccurate production and distribution plans.Tablets go high-techProteus Bi
