From Shortages to Surpluses MedTech and Pharmas Demand Planning Remedy

In the current business environment, a company’s global supply chain can make or break its success, regardless of industry. The stakes are especially high, however, for pharmaceutical, medical device, and health care manufacturers and distributors. If planners fail to accurately match supply with demand, the results are product shortages, scrapped inventory, cancelled procedures and patient health risks. These manufacturers and distributors absolutely need to get their forecasts, inventory levels and supply strategies right.

In today’s volatile, disrupted supply chain environment, that’s easier said than done. Life sciences companies operate across a globally dispersed manufacturing and supplier network. Materials shortages are common. Natural disasters, socio-political conflicts and other events interfere with their ability to deliver products to where they’re most needed.

Challenges also exist on the demand side. Manufacturers have moved products closer to end patients to minimize delivery time and costs — but that has only added to the complexity of demand variability. Forecasts must consider shelf life, product serialization, changing regulations and jurisdictional requirements. Increased access to health care, changing modalities and demographics — such as an aging population — are other forces that impact consumer demand. Significant market events — including breakthrough product introductions, regional disease outbreaks and public health emergencies — can also influence demand.

All these supply and demand dynamics place life sciences companies in a tough situation. If they forecast too low, patients won’t get the products that can positively impact their health. If they forecast too high, they’re left with excess inventories, outdated products and high levels of waste.