A leading U.S.-based healthcare system with over $500 million in annual pharmacy spend is targeting millions in savings through full procure-to-pay digitalization.
TraceLink
Key Takeaways:
· The DSCSA has significantly advanced supply chain integration in the pharmaceutical industry by mandating that all supply chain participants be interconnected to exchange regulatory data.
· The complexity across a huge network of suppliers and customers is what gets exponentially more challenging.
· A leading U.S. healthcare system is expected to save millions of dollars through full procure-to-pay digitalization.
TraceLink, the end-to-end digital network platform for intelligent orchestration of the life sciences and healthcare supply chain, has announced significant new platform enhancements to drive supply chain transformation with its Orchestration Platform for Universal Solutions (OPUS). The new capabilities are designed to empower supply chain, finance, commercial, and IT leaders to master today’s supply chain complexities and prepare for the increasing prevalence of goal-oriented AI systems.
Digital tools to enhance supply chain visibility, and to serialize products, is not new to life sciences in light of the Drug Supply Chain Security Act (DSCSA) and other regulations that demand more visibility to protect patients and product. But how many life sciences companies are leveraging advanced digital tools like AI? I reached out to TraceLink to gain a better understanding of these new digital tools and the adoption rate in the U.S.
“I'd say it's a very small portion, maybe at about 25% based on our experiences,” says Lucy Deus, SVP of Supply Network Products, TraceLink. “Where you do see more digitalization is inside the four walls of a company, like their manufacturing systems or their warehouse systems, ERPs, things like that. But when it comes to interconnecting and linking together the supply chain and operating as a unit, that's where you see the much lower adoption at this point… but it is gradually increasing.”
The DSCSA has significantly advanced supply chain integration in the pharmaceutical industry by mandating that all supply chain participants — including buyers, sellers, pharmaceutical companies, wholesale distributors, pharmacies, and hospitals — be interconnected to exchange regulatory data. Beyond this core requirement, it has also prompted pharmaceutical companies to integrate with contract manufacturers, contract packagers, and third-party logistics providers (3PLs), since they generate critical track-and-trace information. This digitization across upstream partners enables smoother downstream operations, creating a strong incentive for achieving end-to-end supply chain connectivity in the U.S. pharmaceutical market.
But what is holding companies back from adoption? Cost, of course, and complexity, as well as a lack of standardization.
“Regulations like track-and-trace helped connect companies, but many still customize standards, making integration harder. Larger companies can handle this, but smaller ones often struggle,” says Deus. “Our approach streamlines the process — one integration connects you to the whole network, enabling the exchange of all types of business data without managing dozens of separate connections. This makes end-to-end supply chain digitalization far easier for everyone.”
TraceLink’s platform and product releases spans across the company’s various products, and each play a distinct role in enabling transformation:
OPUS: Enables the design, deployment, and scaling of orchestration solutions across the supply chain, driving process consistency and automation.
MINT: Links partners and automates multienterprise supply chain transactions, eliminating silos and improving real-time collaboration.
POET: Empowers cross-functional teams to execute shared workflows with greater speed, visibility, and accountability.
SPI: Ensures data accuracy and real-time visibility into serialized product events, reducing compliance risk and improving inventory decisions.
Patient safety
Despite ongoing challenges, the potential benefits of digitalization are significant. For instance, targeted recall solutions leveraging digital networks can "dramatically accelerate" the removal of recalled products from the supply chain, enhancing patient safety.
“We can instantly detect any recall product that you may have shipped to a customer or that you may have received from your supplier, and then give you the exact dates, the exact locations, the exact quantities of recall product that have impacted you,” says Deus. “This is amazing because it now gives you pinpoint accuracy so that it can really dramatically reduce the amount of time for you to remove that product from the supply chain and ensure that it does not get in the hands of the patient.”
TraceLink's unique B2N Integrate-Once™ model enables companies of any size or digital maturity to collaborate on a shared digital network.TraceLinkAdditionally, deeper integration between life sciences companies and their manufacturing partners can improve oversight and quality, ensuring products are right the first time.
Democratization of Digitalization
The push for digital transformation “extends above and beyond the regulatory requirements" to enhance all facets of the supply chain, says Deus. This approach not only meets regulatory demands but also improves overall efficiency and safety. Paul Cianciolo, COO of TraceLink, shared with me some real-world examples to better illustrate the tangible benefits of the company’s digitalization tools.
1. He told me about a leading U.S. healthcare system that is expected to save millions of dollars through full procure-to-pay digitalization.
“It’s a very basic problem, but this particular health system spends half a billion dollars a year on pharma products. Their main problem was they couldn't get visibility into all the inbound invoices from all the suppliers they were buying from," says Cianciolo.
By digitalizing invoices, the healthcare system can now take advantage of basic benefits like prepay discounts, funneling savings back into patient programs.
2. Then, in Europe, a pharmaceutical company faced challenges with inventory visibility at its third-party logistics providers. Without real-time data, the company struggled to plan supply forecasts and manage stock effectively.
“Sometimes you're making a decision to supply stock that's going to take it away from somebody else,” says Cianciolo. “And if you don't have visibility into what's inside the four walls of your 3PL, you're really hard pressed to know whether you should accept that order or not. And sometimes you do, and you create the inability to fill the stock with somebody else, therefore you end up with a shortage somewhere.”
The digital platform now provides centralized, real-time visibility across all sites, enabling better decision-making and reducing the risk of stockouts.
3. Lastly, for a contract manufacturer, digitalization offers a way to improve customer service levels and production visibility.
“The CMO has a challenge because they don't necessarily have visibility into the orders that are coming in. They can't acknowledge those orders. And they can't necessarily let their manufacturers digitally know when those orders are being shipped,” says Cianciolo. “This results in constant back-and-forth between CMOs and brand owners via phone and email, leading to errors, missed forecasts, partial shipments, and ultimately patient stockouts.”
Digital platforms solve this by enabling CMOs and brand owners to integrate their systems, exchange chosen transactions in real time, and gain shared visibility. This improves collaboration, reduces chaos, strengthens supplier–customer relationships, and ensures patients reliably receive the products they need.
The complexity across a huge network of suppliers and customers is what gets exponentially more challenging. This platform from TraceLink, and the other digital tools available, is all about removing that complexity.
“It removes the complexity by allowing everybody to use the enterprise system that they already showed up with, and they can integrate however they want to,” says Cianiolo. “They can exchange information however they choose in whatever format and types, including a user interface for the least digital mature among us. And so, everyone gets to play. It's a democratization of digitalization.”
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