Supply chain innovation key to affordable healthcare

20 July 2017

Advanced supply chains could be the key to helping life sciences and healthcare meet increasing demand for services cost effectively, according to a report.

DHL’s The Future of Life Sciences and Healthcare Logistics argues that the sector urgently needs to change its supply chains in response to technological innovations and evolving patient needs.

Between 2015 and 2019, global healthcare spending is expected to increase by 4.3% annually. There are significant pressures from governments and regulatory authorities to lower costs.

Meanwhile, consumers increasingly receive services through online channels and mobile applications, spurring growth of tele-health and e-pharmacies.

Yet the industry is currently ranked in the bottom 20th percentile of McKinsey’s Industry Digitization Index, lagging behind the public sector.

Among the trends and technologies that will revolutionise the health and life sciences supply chain are advanced data analytics, which will let healthcare providers make more informed decisions about the management of their operations, predict demand, cut costs and improve efficiency.

The internet of things is allowing increased visibility and connectivity across the supply chain, with tighter control of product inventories and reduced loss and waste.

“Stronger links between physical products and data will also aid the industry in it is ongoing battle against theft and counterfeiting,” said the report.

The online pharmaceutical market is expected to grow to $128bn by 2023, which is likely to see the transformation of delivery channels to increase speed and flexibility in last mile.

Life sciences manufacturers are likely to extend operations downstream into hospitals to enable on-demand delivery of devices from medical parts to surgery kits.

Healthcare supply chains are likely to introduce automation and robotics to meet increased demand and control costs.

“The use of robots and automated vehicles will bring solutions to reduce labour required in repetitive tasks such as picking products in warehouses to sorting and analysing laboratory samples,” said the report.

“Further, aerial drones will be used to enable faster, cheaper last mile deliveries in remote areas.”

Augmented reality will introduce new ways of displaying and presenting information to make supply chain operations more accurate and efficient in situations such as selecting the right product from warehouse shelves or even providing medical teams with patient information.

Technology such as additive manufacturing will enable medical devices and drugs to be increasingly personalised or manufactured on demand using 3D printing systems.

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