GBI Research, leading business intelligence provider, has released its latest research report, entitled Pharmaceutical Supply Chain in Europe - Adoption of Direct to Pharmacy (DTP) Model to Boost Efficiency and Optimize Pricing. The report focuses on the current scenario of supply chain management. Key participants in the pharmaceutical supply chain in Europe are covered in the report as well as issues such as pricing, labeling, packaging, warehousing, logistics, and distribution.

The number of full-line wholesaler in the UK is decreasing due to an increase in the adoption of alternate distribution systems such as DTP and RWA. A study conducted by the Institute for Pharmaeconomic Research (IPF) in 2010 revealed that Spain had the highest involvement of full-line wholesalers in the pharmaceuticals supply chain process, with 96% of total turnover in the country, while direct sales from manufacturers accounted for only 4%. France had the highest share of direct sales from manufacturers. In 2010, the DTP and RWA models had a high market share of 25% in the UK.

European member states have a lot of differentiation in the pricing of pharmaceuticals. As a result of national price controls and regulations, parallel traders get the opportunity to import pharmaceutical products between EU member states. This provides an opportunity to traders to buy pharmaceutical products in low-price member states and re-sell them in high-price areas, resulting in huge profits.

According to the European Federation of Pharmaceutical Industries and Associations (EFPIA) the nature of parallel trade is such that it greatly complicates the traditional route of supply where quality control is effectively checked at all stages. Examples reported by research-based pharmaceutical companies highlight a series of safety and quality problems arising from the handling of pharmaceutical products by parallel traders, in addition to logistic problems and regular product shortages in some countries where medicines simply do not find their way to patients in need. This raises not only serious safety issues in terms of patient consumption, but also acts as an obstacle in case of product recalls.

The total profit made by manufacturing companies, wholesalers and pharmacies has decreased due to several factors related to the respective level of supply chain processes. For manufacturing companies, the primary reasons for low returns are patent expiries, stringent regulations for new product approvals, economic turmoil, changes in demand patterns, and government pressure to reduce drug prices, among others.

Manufacturing companies are increasingly adopting new models of distribution, such as DTP and RWA, to cut out intermediaries and allow wholesalers to strategically becoming a part of new supply chain models. The government is increasingly keeping check on profit percentage margins leading to low profits for wholesalers over the past decade.

As a result, companies are now focusing on international levels with a primary focus on emerging markets to explore new market segments with segment-specific strategies.

Scope

• Segmentation of pharmaceutical supply industry by its major components such as manufacturers, wholesalers and pharmacies.
• Key issues and unmet needs of the pharmaceutical supply chain in Europe.
• Analysis of strategies adopted by pharmaceutical manufacturers and wholesalersto stay competitive in the current scenario
• Key parameters that are considered for choosing a pharmaceutical supply vendor.
• Profile of key companies which deal in pharmaceutical supply chain management.
• Analysis of factors which are considered for outsourcing pharmaceutical supply chains to other companies.

Reasons to buy

• Decide on the existing market scenario in pharmaceutical supply chain management.
• Analyze the requirements for regulatory compliance for pharmaceutical supply chain management.
• Gain knowledge of the key challenges and unmet needs of the pharmaceutical supply chain in Europe.
• Develop strategies for quality control of pharmaceutical supply materials.
• Develop risk mitigation strategies to enhance risk management.

1 Table of Contents
1 Table of Contents 4
1.1 List of Tables 7
1.2 List of Figures 8

List of Tables

Table 1: Pharmaceutical Supply Chain in Europe, Top Five Countries in Europe, Split of Turnover of Distribution Channels in Respective Countries (%), 2010 20
Table 2: Pharmaceutical Supply Chain in Europe, Number of Deliveries per Week and Time Taken for Each Delivery (Hours), 2010 21
Table 3: Pharmaceutical Supply Chain in Europe, Discount Rates Offered by Wholesalers (%), 2010-2011 23
Table 4: Pharmaceutical Supply Chain in Europe, Total Number of Pharmacies in EU-32, 2011 25
Table 5: Pharmaceutical Supply Chain in Europe, Pharmacist Remuneration Systems for Reimbursed Generic Medicines in Europe, 2011 26
Table 6: Pharmaceutical Supply Chain in Europe, Overview, Share of Parallel Imports in Pharmacy Market Sales (%) 2009 34
Table 7: Pharmaceutical Supply Chain in Europe, VAT Rates for Outpatient Prescription Medicines, 2009 37
Table 8: Pharmaceutical Supply Chain in Europe, Import and Export in European Pharmaceutical Industry ($bn), 2009-2011 46
Table 9: Pharmaceutical Supply Chain in Europe, The UK, Companies Implementing Distribution Changes in the Supply Chain Model, 2011-2012 56
Table 10: Pharmaceutical Supply Chain in Europe, Company Profile of Leading Wholesalers, Celesio, Full-Line Wholesaler Brands, 2012 66
Table 11: Pharmaceutical Supply Chain in Europe, Company Profile of Leading Wholesalers, Celesio, Pharmacy Trademarks, 2012 67
Table 12: Pharmaceutical Supply Chain in Europe, Company Profile of Leading Wholesalers, Celesio, Business Marketing and Logistics Trademarks, 2012 68

List of Figures

Figure 1: Pharmaceutical Supply Chain in Europe, Overview, Supply Chain Structure, 2012 10
Figure 2: Pharmaceutical Supply Chain in Europe, Overview, Customized Supply Chain Structure, 2012 12
Figure 3: Pharmaceutical Supply Chain in Europe, Overview, Breakdown of The Retail Price of A Medicine (%), 2010 14
Figure 4: Pharmaceutical Supply Chain in Europe, Overview, Breakdown of the Retail Price of A Medicine (%), 2009 15
Figure 5: Pharmaceutical Supply Chain in Europe, Manufacturers Role in the Pharmaceutical Supply Chain, 2011 16
Figure 6: Pharmaceutical Supply Chain in Europe, Profit for Pharmaceutical Manufacturing Company, %, 2011 18
Figure 7: Pharmaceutical Supply Chain in Europe, Market Share of Full-Line Wholesalers, 2010 19
Figure 8: Pharmaceutical Supply Chain in Europe, Top five Countries in Europe, Split of Turnover of Distribution Channels in Respective Countries (%), 2010 20
Figure 9: Pharmaceutical Supply Chain in Europe, Number of Deliveries per Week and Time Taken for Each Delivery (Hours), 2010 21
Figure 10: Pharmaceutical Supply Chain in Europe, Working Capital Flow Through Supply Chain, 2010 22
Figure 11: Pharmaceutical Supply Chain in Europe, Wholesale Distribution Margin, 2009-2010 23
Figure 12: Pharmaceutical Supply Chain in Europe, Total Number of Pharmacies in EU-32, 2011 24
Figure 13: Pharmaceutical Supply Chain in Europe, PSCI Founding Members, 2012 29
Figure 14: Pharmaceutical Supply Chain in Europe, Principles of Pharmaceutical Supply Chain Management, 2007 30
Figure 15: Pharmaceutical Supply Chain in Europe, Overview, Share of Parallel Imports in Pharmacy Market Sales (%) 2009 33
Figure 16: Pharmaceutical Supply Chain in Europe, Case Study 35
Figure 17: Pharmaceutical Supply Chain in Europe, Case Study 37
Figure 18: Pharmaceutical Supply Chain in Europe, Case Study 39
Figure 19: Pharmaceutical Supply Chain in Europe, Case Study 40
Figure 20: Pharmaceutical Supply Chain in Europe, Case Study, 2011 44
Figure 21: Pharmaceutical Supply Chain in Europe, Factors Leading to Changes in the Business Models of Pharmaceutical Companies in Mature Markets, 2012 45
Figure 22: Pharmaceutical Supply Chain in Europe, Import and Export in European Pharmaceutical Industry ($bn), 2009-2011 46
Figure 23: Pharmaceutical Supply Chain in Europe, Global Supply Chain Model, 2012 48
Figure 24: Pharmaceutical Supply Chain in Europe, Using Free Trade Agreements to Generate Cost Savings, 2012 49
Figure 25: Pharmaceutical Supply Chain in Europe, Raw Material Procurement, 2012 50
Figure 26: Pharmaceutical Supply Chain in Europe, Reforming Costs by Optimizing Cash Flow and Working Capital Structure, 2012 51
Figure 27: Pharmaceutical Supply Chain in Europe, Strategic Sourcing Model, 2012 52
Figure 28: Pharmaceutical Supply Chain in Europe, Case Study, 2011 53
Figure 29: Pharmaceutical Supply Chain in Europe, Agile Supply Chain, 2012 54
Figure 30: Pharmaceutical Supply Chain in Europe, Centralized Supply Chain and Local Logistics Presence, 2012 55
Figure 31: Pharmaceutical Supply Chain in Europe, Risk Management, 2012 58
Figure 32: Pharmaceutical Supply Chain in Europe, Drivers and Restraints, 2012 62
Figure 33: Pharmaceutical Supply Chain in Europe, Company Profiles of Leading Wholesalers, Celesio, 2012 65
Figure 34: Pharmaceutical Supply Chain in Europe, Company Profile of Leading Wholesalers, Alliance Healthcare, 2012 69
Figure 35: Pharmaceutical Supply Chain in Europe, Company Profile of Leading Wholesalers, Phoenix Healthcare, 2012 70
Figure 36: Pharmaceutical Supply Chain in Europe, Company Profiles of Leading Logistic Providers, UPS, 2012 72
Figure 37: Pharmaceutical Supply Chain in Europe, Company Profiles of Leading Logistic Providers, DHL, 2012 73