Optimizing the Healthcare Supply Chain With a WMS

How pharmaceutical and medical supply distributors can navigate supply chain disruptions during a global pandemic.

In recent years, our supply chains have successfully faced challenges ranging from severe weather and natural disasters to trade wars and cyber-attacks. It quickly became apparent, however, that our supply chains were not hardened and prepared for the ripple effects of a global pandemic. With ventilators, masks, gowns, personal protective equipment (PPE), and other critical medical supply shortages, healthcare facilities and anyone on the front lines was left scrambling.

Why a WMS?

While the pandemic has impacted distributors of every size and shape, those handling pharmaceuticals and medical equipment, devices and other supplies are now encountering new impediments getting products to customers. Distributors handling, shipping and dispensing these goods stand to benefit from a warehouse management system (WMS).

A WMS can help distributors of pharmaceuticals and medical supply items address their unique situations. Healthcare facilities and hospitals may not have large inventories or warehouses, but they have complex needs. Similarly, pharmaceutical logistics can be incredibly demanding and challenging because many medications have tight distribution controls that require detailed audit trails. In addition, some medications or medical equipment have specific storage requirements such as materials that expire. Using them after certain dates could affect full potency or potentially threaten lives.

The healthcare industry must constantly adapt to new limitations in the fields of health, safety and sales channels. For the pharmaceutical sector, strict regulations add even more complexity to supply chain operations. What’s more, the industry’s existing challenges have been compounded by the outbreak of COVID-19. The pandemic has burdened supply chains in unprecedented and unanticipated ways, forcing pharmaceutical distributors to seek out new ways to boost their operations. Fortunately, a WMS can do much of the heavy lifting.

Pharmaceutical Distribution Benefits

At its core, a WMS is designed to offer accurate receiving and inventory tracking, reduce picking errors, and provide faster order fulfillment times, shipping manifests and more. For this reason, pharmaceutical distributors can optimize their operations with a WMS to meet existing challenges, while also positioning themselves to meet medium-to-longer-term challenges as well.

Take lot tracking functionality, for example. Lot tracking provides automated shelf management to better track prescription drugs with expiry dates and other date sensitive attributes. Pharmaceuticals can be easily tracked because lot numbers are recorded when received into inventory. From the moment a specific drug with a lot number is shipped, lot tracking functionality will track the lot, customer, invoice number, invoice date and amount of the invoice. As orders are shipped, lot numbers are assigned to each sales order so that the database knows which lots were shipped on which orders.

Similarly, the Prescription Drug Marketing Act’s pedigree requirements mandate a statement of origin that identifies each prior sale, purchase or trade of a drug, including the date of those transactions and the names and addresses of all parties to them. A pedigree may be in paper or electronic form and must include the addresses and lot numbers of the drug. With a WMS, distributors know the exact location of products for any pedigree in their system because of lot capture at both inbound receipt and at outbound sales order picking. The ability to exchange pedigrees electronically also improves customer trust in the validity of the products and makes it easier for partners to do business with that distributor.

Many wholesale distributors, warehouse managers and others face new challenges stemming from the Drug Supply Chain Security Act (DSCSA), which requires organizations to securely transfer digital information about pharmaceutical inventories and shipping to governing bodies, suppliers and partners. A quality WMS should make it easy to increase data accessibility within the application to help customers meet DSCSA requirements.

Medical Supply Distribution Benefits

COVID-19 will continue to impact (and increasingly complicate) the state of the supply chain. The current epidemic has demonstrated just how quickly things can change, and how immediate demand can be created as a result. For the healthcare supply chain, this has manifested in the form of a fundamental and urgent need for those critical medical items and PPE in the midst of the global pandemic.

In the U.S. right now, a serious supply chain-related concern is that our country may run out of certain essential products, and not just pharmaceuticals, but much-needed medical supplies as well. The supply chain’s ability to endure the current state of affairs and bounce back quickly once it’s possible for operations to return to business-as-usual (or whatever becomes the “new normal”) will be challenged the longer the crisis continues. For distributors of medical supplies, this should resonate as an urgent call to action for more specific IT capabilities, like a WMS, in distribution facilities.

Using slotting functionality from a WMS, for example, medical supply distributors can optimize fulfillment by automatically identifying the most efficient locations for fast moving items and high travelled pick faces. SKUs whose activity have increased markedly or show other favorable velocity characteristics can be efficiently moved to a more favorable primary placement, for example bin locations between the shoulders and knees near outbound docks.

The Path Forward

Highly regulated industries, especially those in the pharmaceutical and medical supply field, can benefit from a WMS designed to meet their unique requirements and needs. As with recently introduced mandates like DSCSA, navigating the COVID-19 crisis requires an examination of past practices and changing the way distributors do business.

The global COVID-19 crisis is testing the way we live our lives and conduct business, and its complicating effects will only be amplified over time. Changes made now to adapt lifestyles and business practices will ultimately affect supply chain behavior during these volatile and uncertain times as well.

Given the benefits and value that a WMS provides healthcare and pharmaceutical supply chains, it’s easy to see how these solutions will continue to play a major factor for distributors who take advantage of WMS capabilities to optimize their warehouse operations and navigate future and unforeseen supply chain disruptions.

This article first appeared in Supply Chain Brain on July 21, 2020. To go to the publication, please click here.