Introduction
Extensive growth in the pharmaceutical industry over the last number of years has resulted in an increased demand for third-party logistics (3PL) services as companies began to outsource and adopt more virtual operations. Outsourcing to a third-party logistics provider can often save companies money and time by allowing them to avoid the ongoing investments and effort required to expand capabilities and remain viable over time. Third-party logistics (3PL) providers are manufacturers that are responsible for the logistics of your product from end to end. They manage many daily activities such as warehousing, transportation, distribution, regulatory, licensing, and other elements for your entire product portfolio to bring your products to market.
With the rise in 3PL companies globally, how do you know how to choose the right one?
A top priority for pharmaceutical logistics is ensuring product and supply chain integrity from start to finish and as such your 3PL provider must follow Good Distribution Practice (GDP). GDP legislation sets out the minimum standards that companies involved in the distribution of medicinal products must meet to ensure that the quality and integrity of medicines are maintained throughout the supply chain.
Good Distribution Practice (GDP)
The GDP guidelines are essential as they ensure
- Your medicines are sourced, stored, and transported correctly.
- Your medicines are always up to the EU standard and protected against contamination.
- Your medicines will arrive to the patient following the correct timeline.
Choosing your 3PL Provider
When choosing a 3PL provider, there are multiple factors that can determine your decision and the below highlights some of these key considerations:
Product Requirements
First and foremost, the 3PL provider that you choose must be able to meet your product’s needs. If your product needs to be stored at -20°C, the facilities to store your product at that temperature at each stage of the supply chain must be obtainable. Similarly, the size of your shipments is important. It is important to note what inventory storage capabilities the 3PL provider has and will they be able to store a high volume of inventory. Location is another essential factor given that if you have patients in the US, EU, UK, and APAC regions, your 3PL provider(s) will need to have facilities in these areas to support timely distribution ensuring that your products reach your patients.
Company Infrastructure
Before going into business with a company is it wise to conduct an overview of their financial stability. Low prices can be enticing but reputation and safety is key. If the 3PL provider has cut costs on safety regulations, it will become a long-term financial burden for your organization. Following on from finance is reputation. Research the companies thoroughly and make sure that they match your needs. It is important to build your relationship on trust, make sure that your values correlate for good business practice. You do not have to choose the largest and most profitable 3PL provider but make sure they have adequate experience for your products.
Quality Assurance
After doing your research on 3PL providers, an audit of their site is required and ideally should be performed in person, although recent travel/facility restrictions have made this a challenge. Your 3PL provider will be responsible for the logistics of your product, they will manage each stage of the supply chain. This means that 3PL providers must have the processes and technologies in place to ensure that the necessary warehousing, storage, packing, transportation, and delivery methods are followed at each stage to preserve the standard of the product. It is important to conduct a technology assessment and to check their operational procedures. Your 3PL provider must provide visibility to your product and shipments throughout the supply chain. For example, if a shipment goes missing, is there a roadmap in place to show how this will be resolved? This conveys the importance of the various systems in place and their need to be of a certain standard. Along with the IT system, it is important for your 3PL provider to have a sufficient quality management system (QMS) in place and to have an appropriate quality team that can conduct internal audits. It is crucial for these quality systems to be in place as this ensures that the standard of the product is never compromised and that they stay in compliance with GDP guidelines.
Conclusion
Overall, when selecting a 3PL provider to manage your supply chain, it is always better not to cut corners and spend time, effort, and money to ensure a smooth process that does not sacrifice the integrity or accessibility of your product for patients.
DISCLAIMER:
The information presented within this blog is for illustration purposes only and is not to be considered professional advice. Any information related to health contained within this article is not a substitute for appropriate medical advice from licensed healthcare professionals
References
the-pharmaceutical-industry-in-figures-2021.pdf (efpia.eu)
Good distribution practice | European Medicines Agency (europa.eu)
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