Over the last decade, the pharmaceutical packaging landscape has seen a lot of changes. The introduction of new technologies has paved the way for companies to explore more innovative solutions, improve their operations, and drive efficiencies across the supply chain.

In this article we’ll explore three of the biggest trends in pharmaceutical packaging and the impact they will have on the supply chain moving forward. We’ll also discuss how early adoption of these trends will help companies to remain ahead of their competition.

The contract packaging landscape
Generally speaking, packaging has traditionally been seen as an extension of manufacturing operations, meaning contract manufacturing organizations (CMOs) have assumed responsibility for manufacturing and packaging to provide a full-service manufacturing solution for their customers.

However, contract packaging organizations (CPOs) have taken a more prominent role in the pharmaceutical supply chain over the last few years, as the demand for packaging services continues to grow. As a result, the pharmaceutical packaging market value is expected to reach over €128 billion by 2025.1 This is due to a number of factors, including the complexity of packaging requirements increasing as more innovative products are brought to market and new regulations are introduced across multiple locations—including the various serialization legislation introduced such as the Drug Supply Chain Safety Act (DSCSA) and the EU’s Falsified Medicines Directive (FMD).

As such, specialist packaging companies, with an in-depth knowledge of market requirements and the ability to tailor solutions to customer-specific requirements have steadily become a more and more important part of the supply chain. As we move into 2018, there are a number of packaging trends that will continue to drive these outsourcing requirements across the pharmaceutical industry.

Postponement
In traditional packaging, a CPO provides a bulk packaging service, whereby large volumes of pharmaceutical product is primary and secondary packed ready for a specific market. The product is then shipped to the country it is intended for, where it is stored in a warehouse until it is required. Whilst widely adopted, this approach quite often produces a lot of waste product, due to volatile demand, and incurs high inventory costs in multiple locations.

In more recent years, companies have started exploring the idea of late-stage customization or postponement packaging, whereby blank product components such as the blister packs, boxes and leaflets are stored in the central warehouse and are only customized for a specific market when there is a demand. The product can then be shipped within hours of receiving the order.

So far, the adoption of postponement packaging has been sporadic, with many companies reluctant to tackle its complexity or invest the money needed to package in this way. There are so many different shapes, sizes and formats for medicines, that it is quite difficult to create a process which could cater for them all. However, given the huge variety of regulations and languages across Europe, postponement is becoming more attractive to companies supplying to this market as it offers huge opportunities to improve efficiencies, reduce costs and waste, and lower the likelihood of reworks being required. As companies move into exploring postponement packaging further, they will likely enlist the help of specialized CPOs who are already equipped to package products in this way.

Looking further ahead, postponement has huge potential to transform the way that healthcare is delivered to patients. It could eventually lead to patient specific packaging, whereby medicines are customized and packaged per the individual patient’s need. Furthermore, drug products could potentially even be delivered direct to the patient, reducing the number of steps between the patient and product, and streamlining the supply chain.

Serialization
Serialization will also continue to be a huge focus in pharmaceutical packaging throughout 2018, as the EU FMD deadline of February 2019 and delayed enforcement date of the DSCSA get closer. Serialization has been widely discussed across the industry since the regulations were first announced and it is likely that the implementation of new systems to meet legislation will have a lasting effect on the industry.

The introduction of mandatory barcodes and the management and transfer of the huge amounts of data generated increases the complexity of pharmaceutical packaging and means that companies are faced with refining their operations to meet these needs. Consequently, many drug manufacturers have been slow to adopt serialization and are now struggling to put the appropriate infrastructure in place to cater for their own needs or those of their customers. Cost has also been a huge barrier for small to mid-sized contract manufacturing organizations (CMOs) in particular, as the onboarding process for their customers can mean a delayed return on investment (ROI).

That being said, it’s vital that companies look beyond the initial implementation challenges. Serialization and full track and trace systems, such as those that will eventually be required in the U.S., will not only lead the industry towards a safer and more secure supply chain, but could ultimately help to connect the whole industry from manufacturer to patient.

The processes that are introduced to ensure compliance will no doubt help to streamline the exchange and processing of data across other business areas as well. For example, companies will be able to look at legacy data over time and optimize their logistics operations through real-time monitoring, resulting in accurate demand planning as opposed to assumption-based forecasting, as well as improved warehouse management, shipment visibility, and more efficient distribution.

In short, serialization has the potential to disrupt the supply chain and lead to better cross-company collaboration. This could not only mean a more integrated and streamlined approach to bringing new drugs to market, but also ensure that as an industry we continue to provide healthcare services safely and at an affordable price.

Digitization of the supply chain
It’s well accepted that the pharmaceutical supply chain is leagues behind in terms of digitization, and, as such, paper-based processes remain commonplace in a lot of organizations. However, due in part to serialization, the industry is making a move towards a more digital approach to data management and data exchange.

Furthermore, the advent of distributed ledger technology, better known as blockchain, has significantly increased the digitization opportunities for pharmaceutical companies, with the ability to have a cross-company immutable log of transactions that is not governed by any one organization.

However, to really take full advantage of digital supply chain processes, companies first need to address their internal operations and capture data in a way that is readable, and usable, by computerized systems, such as analytics tools. Better visibility of the business’ value stream could not only give organizations the ability to make better informed decisions, but also paves the way for the implementation of automated processes and well-targeted and measurable process improvement projects.

The benefits of staying ahead of the curve
While these trends are still relatively new for the industry, there are benefits to be found in early adoption. Companies who take a proactive approach to developing their packaging solutions and incorporating full track and trace and postponement into their operations will inevitably find themselves in a better position when these new digital processes become more widely adopted. It is important that the industry continues to drive these developments forward in order to fully realize the broader impact on supply chain management.

References

1. Pharmaceutical Packaging Market Size Worth $158.8 Billion By 2025, June 2017, https://www.grandviewresearch.com/press-release/global-pharmaceutical-packaging-market

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Dexter Tjoa is director of corporate strategy at Tjoapack. He is responsible for devising, implementing and evaluating the mid to long-term strategies of the company and the services it offers, as well as overseeing the commercial and finance departments within Tjoapack. Since joining the business in 2016, he has also launched contract serialization service provider Meditraq, part of the Tjoa Group. He holds a BSc in Mathematics from the University of London and a MSc in Mathematics and Computer Science from the University of Oxford and has previously worked in the technology sector.