PGBM 63 Global Logistics & Supply Chain Management

Module Assessment 2017/18 (Part 2)

Sunderland Business School

Level: Masters Programme (MBA) Module: Global Logistics & Supply Chain Management

Module Leader: Dr. Stella Sofianopoulou Assignment Code: PGBM63

Issue date: 20/09/2018

Canvas & JIRA/Web Service Submission date: Tuesday 13 November 2018 at 14:00
th

Module Tutor: Tawfiq Elahi Moderated by: Dr. Thorben Haenel

Any work submitted is subject to the University’s Misconduct Regulations

PART 2 – COURSEWORK ASSIGNMENT

Contribution to unit assessment: 70% weighting

Subject: Individual analysis of ‘Good Distribution Practice and Pharmaceutical Supply

Chain Management’ case study. Background: See attached case study

Notes:

1. All assignments must be submitted on Canvas first. A Turnitin Report will be

generated, which then needs to be submitted on JIRA along with the original file.
Therefore there will be 2 attachments on JIRA. Your mark and feedback will be made
available to you electronically on JIRA once the internal moderation process has
taken place, you should note that at this stage marks are still subject to external
examiner and academic board approval.

2. Word count – 3000 +/- 10%

 PGBM 63 Global Logistics & Supply Chain Management
Module Assessment 2017 (Part 2)

All three questions are compulsory.

The three questions are as follows:

a. Using information from the case study and other relevant literature critically
evaluate current global logistics and supply chain issues faced by a
pharmaceutical company of your choice. (30% marks)

b. Using information from the case study and other relevant literature and
considering the pharmaceutical company of your choice, identify and explain
ways in which logistics and supply chain management could contribute to
market competiveness both in terms of efficiency and effectiveness on a
global basis. (30% marks)

c. Using information from the case study and other relevant literature critically
evaluate the meaning of ‘good distribution practices’ in the pharmaceutical
industry on a global basis. Based on your analysis so far in question a, b &
c, recommend a supply chain strategy to your chosen pharmaceutical
company (30% marks)

4 Report format (10% marks)

Assignment guidance notes:

Business Report Structure – 3000 words +/- 10% Size 12 font,

spacing 1.5, include word count.

Report Presentation
• Front Sheet – Name / Student Number / Programme / Module / Date
• Table of Contents
• Introduction
• Main Body of Report – Critical evaluation and analysis of relevant theory and
practice related to the case study (all three questions are compulsory).
• Conclusion
• References - 10 to 20
• Appendix – not included in word count

The criteria for grading the assignment:

The assignment will be graded for individuals on the basis of the specific criteria
outlined in the Generic Assessment Criteria (Postgraduate) on the following page.
 PGBM 63 Global Logistics & Supply Chain Management
Module Assessment 2017/18 (Part 2)

Note:

The “Presentation” element of the Generic Assessment Criteria (Postgraduate) will

also be used (additional to the above assignment guidance notes) to assess the report
structure.
PGBM 63 Global Logistics & Supply Chain Management
Module Assessment 2017 (Part 2)
 PGBM 63 Global Logistics & Supply Chain Management
Module Assessment 2017/18 (Part 2)

Case Study: Good Distribution Practice and Pharmaceutical Supply Chain

Management

Source: Mangan J.. et al. (2012) Global Logistics and Supply Chain Management, 2 nd edn. John Wiley & Sons,

Optimising the supply chain has become a competitive necessity for companies across
the globe including those in the pharmaceutical sector. The pharmaceutical supply
chain is somewhat unique in that compliance at every point along the supply chain is
essential.

It might be tempting to imagine that a manufacturer's responsibility for a pharmaceutical

product lies only within the 'four walls' of a manufacturing facility, but of course, this has
never been the case. Whether through legislation and guidelines or simple common
sense, it is clear that at any point along the supply chain the integrity of all
pharmaceutical products must be assured and not compromised. In short, a
manufacturer's responsibility extends to sourcing materials from approved suppliers,
continues through manufacturing under Good Manufacturing Practice (GMP), and on
to delivery of the product to the final customer or patient under Good Distribution
Practice (GDP).

Hence, Good Distribution Practice remains an essential aspect of compliance for all
pharmaceutical companies as products are stored, transported and delivered on a
global and local basis. Assuring supply chain integrity and patient safety has never
been so important.

Moreover, as global supply chains are becoming more complex, combined with
increasing commercial pressures and the global growth of counterfeiting, it is likely that
GDP has never been more critical. Coupled with a global increase in temperatures, the
need to carefully manage cold chain, frozen and ambient/controlled temperature
products from receipt, storage, transportation and distribution is a significant challenge
for all firms who move pharmaceutical products along more complex and compliant
supply chains.
GOOD DISTRIBUTION PRACTICE

GDP can be defined as 'that part of quality assurance that ensures that the quality of a
pharmaceutical product is maintained by means of adequate control of the numerous
 PGBM 63 Global Logistics & Supply Chain Management
Module Assessment 2017 (Part 2)

activities which occur during the distribution process'? This definition could reasonably
be extended to include sourcing, receipt, storage and transportation, looking at the full
supply chain that is necessary to make and sell pharmaceutical products. The critical
need is to establish controls at all points along the supply chain so that all partners
handling and transporting pharmaceuticals do so within compliance. According to the
European Parliament: 'The main purpose of any regulation on the manufacture and
distribution of medicinal products for human use should be to safeguard public health.

The importance of GDP is elaborated in for example the EU Guidance on Distribution

Practice. Although hugely paraphrased, the following summary of that Principle does
reliably reflect its observations:

The Community pharmaceutical industry operates at a high level of quality

assurance ... and this level of quality should be maintained throughout the
distribution network so that authorised medicinal products are distributed to
retail pharmacists and other persons entitled to sell medicinal products to the
general public without any alteration of their properties.

AREAS FOR CONCERN

Recent information available from the main regulators suggests there are many areas
throughout the pharmaceutical supply chain where deficiencies can be found. Recently
the Medicines and Healthcare Products Regulatory Agency (MHRA) in the UK stated
that '32% of all critical and major deficiencies recorded at inspections related to the
control and monitoring of storage and transportation temperatures'. Other deficiencies
include inadequate systems for dealing with returns and establishing bona fides for all
stakeholders. There is no reason to suppose that the incidents highlighted are in any
way restricted to the. UK and statistics from other countries and regulators suggest
many of the findings are similar. Worryingly, temperature control and monitoring is a
recurring theme. With the growth of biotechnology products and the increasing need to
ship more products under cold chain conditions (2-8°C), more and more pharmaceutical
companies are now refocusing efforts and resources in ensuring that temperature
controls in their transportation/supply chain are correct. Global warming is also
contributing to the challenges faced by the pharmaceutical industry and the industry
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Module Assessment 2017/18 (Part 2)
needs to take care to address this sensitive issue correctly for all products no matter
what their temperature requirements are.

COUNTERFEITING

One of the biggest challenges for the pharmaceutical industry and one of the main
reasons why GDP/good SCM is critical is because of the growth of counterfeit
medicines on a global basis. The US based Centre for Medicines in the Public Interest
predicts that counterfeit drug sales will reach US$75 billion globally in 2010, an increase
of more than 90% from 2005. The EC recently reported a five-fold increase in the
seizure of counterfeit pharmaceutical items for 2006 compared with 2005. The World
Health Organisation website suggests that counterfeits account for around 1% of sales
in developed countries to over 10% in developing countries, and medicines purchased
over the Internet from sites that conceal their physical address are counterfeit in over
50% of cases.

Counterfeit medicines are part of the broader phenomenon of substandard

pharmaceuticals — medicines manufactured below established standards of quality
and therefore dangerous to patients' health and ineffective for the treatment of
diseases.

The difference is that counterfeits are fraudulent and may be deliberately mislabeled
with respect to identity, composition and/or source. Counterfeiting occurs both with
branded and generic products, and counterfeit medicines may include products with
the correct ingredients but fake packaging, with the wrong ingredients, without active
ingredients or with insufficient active ingredients and may even contain harmful or
poisonous substances.

Counterfeit medicines represent an enormous public health challenge. Anyone,

anywhere in the world, can come across medicines seemingly packaged in the right
way, in the form of tablets or capsules that look right, but which do not contain the
correct ingredients and in the worst case scenario, may be filled with highly toxic
substances. In some countries counterfeiting is a rare occurrence, in others it is an
everyday reality. In developing countries the most disturbing issue is the common
availability of counterfeit medicines for the treatment of life-threatening conditions such
as malaria, tuberculosis and HIV/AIDS.
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Module Assessment 2017 (Part 2)

Good SCM coupled with best in class GDP is a minimum requirement in helping to stem
the flow of counterfeit products into legitimate distribution channels and pharmaceutical
supply chains. The need for all stakeholders in the pharmaceutical industry to work in
partnership to ensure supply chain integrity and that only bona fide suppliers and
customers are allowed to buy and sell pharmaceutical products is a must. Regulators
across the world are working with manufacturers, distributors and all stakeholders in
pharmaceutical supply chains to enhance compliance standards.

Both manufacturers and distributors need to fully understand their obligations when it
comes to managing supply chain and product integrity under GMP/ GDP and to be
vigilant where noncompliance could compromise patient safety. Without doubt GDP is
a minimum requirement for successful pharmaceutical SCM and necessary to stem the
flow of counterfeit products into legitimate distribution chains.

CONCLUSION

Optimising the supply chain is a competitive necessity but product integrity, compliance
and patient safety is non-negotiable in the pharmaceutical supply chain. Manufacturers,
distributors and partners who transport and distribute product must ensure that the high
level of product quality achieved by observing good manufacturing practice is
maintained throughout the distribution network as products are transported and
delivered on a global and local basis.

GDP is as essential to the continued success of the pharmaceutical industry as GMP.

All pharmaceutical companies and partners who transport and distribute product on
their behalf must ensure best practice is in place to ensure that no counterfeit products
enter legitimate supply chains and that patient safety is protected at all times.

While the regulators are doing all they can to heighten awareness and compliance in the
management of pharmaceutical supply chains, all stakeholders must go the extra mile to
ensure compliance with all 'regulations and guidelines so that patient safety is assured
from manufacturer to patient — delivering the right product on time every time.
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Module Assessment 2017/18 (Part 2)
Efficient and compliant SCM should have well-trained staff who will ensure GDP (and
GMP) are managed successfully and that pharmaceutical products are handled,
transported and delivered with best in class standards and full compliance.

NOTES

1. World Health Organisation (2006) World Health Organisation Technical Report Series
937, WHO Expert Committee on specifications for pharmaceutical preparations,
Geneva, WHO.
2. Directive 2004/27/EC of the European Parliament.
3. Rules and Guidance for Pharmaceutical Manufacturers and Distributors (2007) MHRA,
Pharmaceutical Press.