ATLANTA, Ga.--Changing regulatory environments, new customer demands around the globe, challenges around product security and increasingly complex products are driving healthcare executives to make strategic supply chain investments, according to findings from the sixth annual UPS “Pain in the (Supply) Chain” healthcare survey, conducted by TNS. New technology investments and go-to-market models are top of mind as healthcare executives drive business and logistics transformations to meet evolving industry needs.
Over the next five years, 84 percent of global healthcare executives surveyed will invest in new technologies, 78 percent will enter new global markets and 70 percent will implement new distribution channels such as going direct to providers, retailers and even end-patients. In addition, 59 percent will increase reliance on third-party logistics partners. Together, these strategies indicate a move toward transformation in the healthcare supply chain.
Technology investments, in particular, signal growing concerns over product protection, which includes the security of high-value shipments and product spoilage, with large jumps in the number of executives planning to invest over the next three to five years in systems that support e-pedigree/ serialization, temperature-sensitive and product security solutions, the survey said.
For the first time since the survey’s inception in 2008, product security surpassed cost management as the second supply chain concern with 53 percent of executives citing it as a top issue. Executives face challenges in product security with the top concern being increasing counterfeit sophistication at 48 percent, followed by poor supply chain visibility, with 40 percent citing it as an issue.
Despite investment plans, concerns over the global economy and healthcare business landscape continue. Globally, 50 percent are still feeling the impacts of the economic downturn, and 60 percent in the U.S. are reporting continued impacts. Executives in Asia express the most optimism on the economy with only 31 percent reporting they are still feeling the effects.
From a future global business challenge standpoint, increasing regulations are the top concern, as reported by 48 percent of respondents. Concerns over healthcare reform and legislation closely follow at 46 percent, and 40 percent of executives worldwide are also worried about intellectual property protection. Executives in Asia are more worried than their peers about increasing competition at 51 percent and patent expirations at 41 percent.
“Healthcare companies are balancing a number of priorities related to capturing business growth opportunities in new markets, protecting increasingly sophisticated and high-value products and navigating a complex regulatory environment worldwide,” said Bill Hook, vice president, global strategy, UPS Healthcare Logistics. “These trends have also been shaping UPS’s solutions to ensure we remain the logistics provider of choice for the healthcare industry. As the industry shifts to meet new customer and market demands, executives are investing in transformative supply chain strategies and strategic partnerships that will help them achieve long-term business goals.”