Pharmaceutical Industry – Supply Chain & Procurement Consulting
Achieve competitive advantages and savings through transparency and your own standards.
The pharmaceutical industry has been experiencing profound changes for years, with mergers and acquisitions dominating the industry. At the same time, demographic trends show the growing importance of the pharmaceutical industry. The ever-increasing complexity of multinational corporations and their global logistics concepts often present a challenge for pharmaceutical companies. Government regulations to reduce costs in the health care sector affect businesses of all sizes, from corporate groups to medium-sized businesses.
We support our clients, national pharmaceutical companies and international pharmaceutical groups, in their global procurement, achieving transparency across the entire supply chain. As a result, companies are set up for dynamic, new market situations for the long term and can achieve sustainable savings and secure competitive advantages.
How do we do it?
Analysis and benchmarking
Before we can develop a ‘roadmap’ for performance optimization and cost reduction, we first identify and prioritise existing potential. We will show you where this potential is in your procurement organization. In a short quick scan analysis, we go through your procurement data, conduct interviews with departments and buyers and evaluate your procurement processes. We take these results as a benchmark, so you know where you stand within the industry and where there is potential for optimization. On this basis, we make clear recommendations for your business. Following this, we support you to implement the optimization measures.
1. Cost reduction in direct and indirect spend
Production or contract manufacturing often dominate procurement in pharmaceutical companies. Spending on items that are not directly incorporated into the value creation process is often neglected. This conceals indirect spend costs amounting to approximately 16% of turnover.
In our experience, the greatest savings potential lies in marketing, logistics, facility management and IT. The challenge is that purchases in these areas are often made by the departments themselves and the procurement department is included in the procurement process either too late or not at all, and inadequate procurement resources make things even more difficult. We help you to reduce your purchasing costs for the long term and act as an interface to aid cooperation between procurement and other departments.
We will support you to implement your new processes and/or transition to new suppliers. The results of our projects are contracts with suppliers, which permanently secure your target savings and optimum quality standards.
On average, we have achieved 15% savings for our pharmaceutical industry clients. As our fees vary depending on the savings we achieve, making savings ensures budget-friendly financing.
- Sustainable, measurable savings on the entire procurement volume
- increasing your profits
Case study: Media procurement by a manufacturer of generic drugs
We made savings of around 18% on the media procurement of a German generic drug manufacturer,while increasing the quality of service. This was achieved through the clear separation of quantitative (e.g. procurement conditions of the agency) and qualitative (e.g. media strategy consulting) decision criteria. Essential criteria to make an objective, qualitative assessment of agencies were pharmaceutical expertise and the range of services offered. INVERTO succeeded in getting the most out of the media budget by implementing a multi-stage process with clients’ employees from the marketing and procurement departments.
2. Developing your own standards for strong procurement positioning
Creating your own standardizations and specifications for products to be purchased and technical facilities is a significant way for your procurement to achieve strong positioning and reduce your dependence on suppliers. We analyse which specification limits of materials can be used by your facilities and how these can be purchased both efficiently and cost effectively throughout the procurement process. Having your own standards and specifications can considerably increase the procurement volume of individual materials, resulting in significant cost savings. INVERTO uses its specialist client project expertise to create the necessary steps between technology and procurement. Our many years of experience mean that we not only know the technical and product-specific challenges you face, we also know the solutions.
- Strong positioning of your procurement in relation to suppliers
- Introducing your own standards and specifications gives you a competitive advantage
- Linking procurement and technology
- Reduced procurement risks
Case study: Packaging optimization for a medium-sized company
The strategic orientation of packaging procurement significantly lowered production costs at a traditional pharmaceutical company. Through tendering total demand across all sites, standardization and the implementation of specialized suppliers, the procurement conditions for folding boxes, labels and instructions were considerably improved. Working with the customer services teams from the production, quality assurance and procurement departments, we achieved savings of over 20% while simultaneously improving quality. INVERTO took over project management and supported operational implementation up to effective delivery.
3. Comprehensive supply chain optimization
Supply chain optimization is usually driven by improving internal processes. However, in our experience as a successful supply chain management consultancy, the most significant improvements are achieved through intensive cooperation between respective partners. This is why we systematically involve existing and potential suppliers in the optimization of supply chain processes. With our supply chain performance check, you will know where you stand in virtually no time.
We determine your current supply chain performance based on a set of criteria, placing particular focus on supply chain integration, using IT solutions to analyse your overarching strategy and the interlinking of the planning process, quality of cooperation and process support. From early involvement in development projects to outsourcing entire production stages, INVERTO designs models of integration, which cope with your company’s challenges and turn your suppliers into active value creation partners. From supplier-side inventory planning and management to cooperative planning, INVERTO communicates with your employees and suppliers to ensure the successful implementation of optimization concepts.
- Reduced process costs and continually improving value creation
- Sustainable improvement in supply chain performance
- The ability to respond quickly to market developments
Case study: Supply chain performance optimization in a pharmaceutical firm
We restructured the supply chain of a global pharmaceutical company. International acquisitions meant new requirements for logistics and supplier management. Our detailed analysis achieved transparency in terms of the strengths and weaknesses of the existing operational and organizational structure. We then defined quantitative supply chain targets (e.g. lead times, complaint rates) and an implementation plan and implemented them using workshops. INVERTO oversaw the analysis of the procurement organization, concept development and implementation, right up to monitoring the quantitative targets.
Do you want to be prepared for dynamic and new market conditions in the pharmaceutical sector, achieve sustainable savings and secure competitive advantages?
Our experts Dr. Frank Wierlemann (firstname.lastname@example.org) and Frank Albrecht (email@example.com) are at your disposal for any questions regarding cost-reductions and performance improvements in the pharmaceutical sector.