Sixty five percent of healthcare executives globally cite regulatory compliance as their number one supply chain concern, a survey finds.
The United Parcel Service (UPS) Pain in the Chain survey, conducted by research company TNS, reveals cost management comes in second, cited by 60 percent of executives as their top supply chain issue.
The transport and logistics company’s fifth annual survey reflects the views of senior-level healthcare supply chain decision makers in the pharmaceutical, biotech, medical device supply companies in the United States, Western Europe, Asia and Latin America.
It shows just 41 percent report success in managing their supply chain costs.
Cited by 46 percent of executives, regulation and healthcare reforms are regarded as the main barrier to global expansion.
“Country regulations have endured as the top barrier to global expansion over the past three years,” says UPS Healthcare Segment Marketing Director Scott Szwast.
“Concerns around regulatory compliance and cost management have been constants for healthcare supply chain decision-makers over the past five years.”
“We’ve also seen growth in concern around areas such as product security and product protection.
“While these areas will always be a focus in the healthcare industry, companies can experience positive impact by examining strategies such as increased collaboration, adopting segment based supply chains and leveraging new innovative models and technologies.”
Other barriers to expansion include intellectual property protection concerns and product quality and security concerns, cited by 33 percent and 27 percent of executives, respectively.
Concerns around intellectual property protection have grown every year for the past three years and are highest in the US and Asia.
Product security and product integrity including product damage and spoilage have risen to the third most cited supply chain issue, reported by 57 percent.
Perhaps to be expected,the survey shows such issues to be more significant in emerging markets where they were more frequently ranked first or second.
Despite the barriers, the survey shows tapping into new global markets and investing in new technologiesthe as the top two planned investments for healthcare companies globally, as cited by 83 percent of decision-makers.
Survey respondents plan to employ both strategies over the next three to five years to increase their competitiveness, maintain product integrity and gain efficiencies.
The top four countries where companies will focus expansion efforts over the next three to five years are China, the United States, Brazil and India.
UPS Healthcare Logistics Vice President Global strategy Bill Hook says this reflects the five-year top trend in the healthcare industry of increasing global growth with companies ramping up expansion into new markets each year.
He says healthcare companies are feeling the pressure to expand and drive new growth while containing costs and ensuring compliance around the globe.
“That has only heightened the need to build more global flexibility, integration and transformation into the healthcare supply chain,” Hook says.
While planning investments, healthcare decision-makers remain ‘cautious’ on the state of the industry.
Healthcare decision-makers in the United States are slightly less optimistic on the economy, with 53 percent of US- based decision makers reporting they’re still feeling economic impacts in terms of tightened spending and other reductions.
This compares to 43 percent in Latin America, 35 percent in Western Europe and 26 percent in Asia that are still feeling economic impacts.
“The five-year survey trends underscore what we are hearing from all segments of the healthcare marketplace,” Hook says.
“From industry leaders to middle market companies, healthcare companies are looking for ways to be more collaborative, provide integrated solutions and address segmentation issues around their customers.”