Life sciences and healthcare sector must update supply chains to compete

DHL says the the life sciences and healthcare sector (LSHC) must improve its supply chain operations if it is to adapt to increasing digitisation and consumer demands.

A report commissioned by the German company found six key trends and technologies that supply chains must exploit if the sector is to transform successfully.

The Future of Life Sciences and Healthcare Logistics report underscores the urgency of the transformation, noting that, according to a digitisation index produced by McKinsey, the sector is in the bottom 20%.

DHL chief commercial officer Bill Meahl said that, as well as consumer demands and digitisation, life sciences and healthcare has been facing increasing cost pressures from governments and regulatory authorities.

“For those who leverage the power of technologically advanced supply chains, there will be a clear competitive advantage that could ultimately prove the difference between surviving or prospering,” said Mr Meahl.

The report lists big data, the internet of things (IoT), on-demand delivery models, robotics and automation, augmented reality and additive manufacturing as the key areas to develop.

Using big data, DHL says, LSHC could better predict supply chain problems before they disrupt operations.

Citing a big data programme operated by the Assistance Publique-Hopitaux de Paris, the report says the four hospitals involved have created “a leaner supply chain with greater insight and optimisation”.

In addition, IoT smart warehouse trials conducted by DHL have resulted in an 18% reduction in net time travelled by workers, through reduced queuing times and forklift operational congestion.

Scott Allison, president of LSHC at DHL customer solutions and innovation, said companies were only just beginning to understand the huge changes the sector was facing.

“This is in terms of how patients are diagnosed and treated, what new care challenges it faces and the technology-driven tools to address them,” said Mr Allison. “It is clear that logistic providers have a key role to play in this transformation to deliver healthcare to the world with cost-effective, agile and highly responsive supply chains.”

With the increasing use of online and home care channels – the online pharmaceutical market is expected to be worth $128bn by 2023 – the report said on-demand delivery would be vital.

The full report can be read here.