Complying with ever-changing regulations continues to be the top concern for healthcare executives, according to the 2014 UPS Pain in the (Supply) Chain survey.
Six out of ten executives mentioned regulatory compliance as their top supply chain issue. Further, 79% of respondents plan to invest in regulatory expertise and increased staffing levels as a strategy to address this challenge.
The key driver for concern is the changing regulatory landscape, including the revision of the EU Good Distribution Practice (GDP) guidelines and changing customs procedures. Companies are struggling to interpret and stay up to date with the changes. Almost half (49%) of executives interviewed said that individual country regulations are the top barrier for export and expansion. 
Product protection is another primary concern, cited by 46% of respondents. The increasing sophistication of counterfeits (48%), poor supply chain visibility and too many hand offs (40%), and inadequate law enforcement (35%) were confirmed as the biggest challenges. Regarding product security, executives are also concerned with product damage or spoilage, which was stated by 40% of respondents.
To overcome risks related to the evolving regulatory environment and supply chain security, companies are focusing on two key areas: collaboration and partnership and technology investments. One in five healthcare companies is already outsourcing three quarters or more of its supply chain budget. To stay abreast of changing regulatory requirements, more than half (57%) of surveyed executives are planning to hire outside consultants, while up to 54% plan to partner with experienced distribution firms. Distribution partners can help manufacturers navigate and comply with regulations, as these firms have the expertise to handle special service requirements for temperature-sensitive storage and distribution. UPS, for example, maintains a formalized quality management system and independent quality assurance group to monitor new and proposed regulation
s to maintain the necessary processes and document control. This allows healthcare manufacturers to focus on their core business – developing products that positively impact patient care.
When it comes to technology, the main focus of executives is on investments that enable product visibility. According to the survey, almost seven out of ten executives (66%) are looking to invest in serialization and product verification technology, while 53% are considering to invest in temperature control and monitoring technologies. Building effective visibility systems, however, is expensive and complex. Competent logistics providers can integrate their own networks with those of their customers and eliminate the need for extra investment while maintaining visibility across the entire supply chain.
Opportunity combined with frustration perhaps best describes the current status of the global healthcare industry. As the global healthcare market evolves, opportunities are developing in the form of new markets and products. However, frustrations have developed as a result of increasing and ever-changing government regulations. To maintain a global standard of compliance demands adept logistics planning and continuous stakeholder engagement. Every logistics solution must include contingency plans, along with a trained and specialized team to implement these plans. It’s important to collaborate closely with customers and build a robust plan for keeping products on course at every stage of their journey. Healthcare manufacturers should choose their distribution partners based on their expertise and network, their proven ability to execute, and their willingness to stand behind their service with actionable quality programs.
For more information on the UPS Pain in the (Supply) Chain survey and to download an executive summary, visit www.pressroom.ups.com/healthcare.
