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Transforming pharma logistics with IOT

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The pharma industry is harnessing the power of disruptive technologies like AI, block chain and 3D printing to improve its supply chain and logistics systems. In this isssue, industry stakeholders share insights on how IOT is revolutinising  pharma logistics to usher in better efficiencies

Stakeholders will look to implement IoT enabled devices to create smart supply chain

Internet of Things (IoT) has the potential to be a greater disruptor as tracking sensors and smart devices have gained prominence in manufacturing supply chains due to the proliferation of RFID technology and faster internet connectivity.  IoT devices or sensors do not need to be scanned like barcodes; they can transmit real-time data to any other IoT device on the same platform via the internet.

Samir Lambay, Co-Founder & CEO, FreightCrate Technologies
Samir Lambay

For pharma companies the benefits of real-time data are immense as the manufacturing process is complex and sensitive, the product quality needs to be perfect and the transportation has to be handled efficiently and often temperature controlled to ensure safe consumption for the customers. There is zero margin for error in both, production and delivery standards. By enabling their manufacturing facilities with smart sensors and their products with IoT devices (such as RFID tags), pharma companies can optimise their supply chains as follows:

  • Manufacturing and operations: Ensuring product quality and productive asset utilisation

Drug production including R&D can account for 50 per cent of sales revenue for pharma companies. Manufacturing new drugs is a complex process and IoT devices can ensure relevant data is available to ensure issues with formulations are proactively managed and batches are produced as per required standards. Trends that can cause delays or slowdowns and inefficient processes can be proactively identified and action can be taken. Preventive maintenance cycles can be analysed, set and adjusted by IoT devices so equipment life-spans are increased and assets work more efficiently.

  • Inventory Management: Smart warehousing Pharma companies need to maintain a fine balance between under-stocking (which can have negative consequences) versus over-stocking (which increases warehousing costs). Moreover, they have many facilities in many locations that add significant operational and management costs. Smart warehouses can improve warehouse asset (forklifts, stackers etc.) utilisation and also the visibility of products in the warehouse. Furthermore, pharma companies benefit by reporting issues, better floor space utilisation and monitoring of drugs.
  • Order Management:  Transparency and visibility

With IoT devices pharma companies can track the shipment from the warehouse to the final delivery location including information on product condition and temperature along the way. They can get access to detailed shipment tracking information on one single platform including:

  • When the shipment departed and arrived
  • Exact real-time location
  • Exceptions regarding product temperature or condition
  • Expected delays

All this can be done without any need for barcode sensors. RFID sensors attached to the pallets can automatically transmit data to smart devices. Moreover, without smart tracking, there is always the possibility of products being lost with an inability to analyse root cause. With tags on all products, supply chain managers can assess where the loss occurred, and better analyse the issue and track if the product was stolen. Trends can also be analysed and supply chains and vendors modified accordingly. IoT for the pharma industry is expected to increase from $420 million in 2015 to $2,486 million by 2020.  All major stakeholders will look to implement IoT enabled devices in an effort to create fully integrated smart supply chains. The vision is to enable every aspect of the supply chain to become a source of data, which can be analysed to continually optimise operations, and reduce costs while improving customer satisfaction.

IoT has the potential to enhance almost all the processes of the pharma industry

Internet of Things is transforming the pharma industry at a rapid pace. IoT has the potential to enhance almost all the processes of the pharma industry ranging from clinical trials, drug disclosure, manufacturing, and supply chain to remote patient monitoring.

IoT applications for supply chain management have become popular investment areas for many industries. Connected equipment, men and material tracking, sample lifecycle management, smart packaging, and cold chain monitoring are among the IoT applications that are particularly well suited to the pharma industry. Warehousing is a crucial area for the pharma industry. IoT applications are placed in the storage area and on inventory items to interpret and transmit vital information (product location, inventory details) and report inconsistencies, such as misplaced products directly to warehouse managers’ handheld devices/dashboards. Corrective measures take place in real time – significantly improving the speed, accuracy, and efficiency of the picking process.

B.G. Barve
B.G. Barve

Another area where IoT technologies can add value is the storage of temperature-sensitive products. Active and passive temperature loggers attached to refrigerators in warehouses and at other sites continuously record temperature. An IoT solution could connect these devices, compare their measurements against thermo stability tables, and prompt them to generate alerts in case of temperature variances.

IoT-based solutions can help pharma manufacturers remotely monitor cold chain environments in real time by embedding sensors on tracking equipment with auto-start and shut-down mechanisms in warehouses, vehicles, or shipments using smartphones and tablets. Tracking the movement of drug inventory at every point can potentially save supply chain participants billions of rupees. When applied to packaging, the Internet of Things affords several advantages, including bi-directional communication, tracking, and status-display mechanisms. This is especially relevant in markets where counterfeit drugs regularly enter the value chain. 2-D bar codes, RFID tags and smart packaging labels make it possible to track each handshake in the supply chain, from manufacturing to dispensing. The result is a complete digital footprint. Digital technologies such as GPS location and condition monitoring afford real-time visibility and security during transport.

Control cold chain conditions: IoT technologies enable placing temperature-sensing tags with shipments. Tags continually record temperatures and environmental conditions. The data is uploaded to the cloud. Recordings are instantly available to the control room. For pharma companies, the IoT extends visibility in virtually every area of the business – from development, to manufacturing, transport, distribution, dispensing and consumption. Real-time information, when coupled with advanced analytics engines, can become the basis for making faster, more accurate decisions; heightening efficiencies, verifying product quality, and assuring regulatory compliance. The risk of doing nothing must be evaluated against changing customer and regulatory expectations and market dynamics. The time is right for pharma companies to accelerate their implementation and utilisation of IoT platforms and solutions.

IoT enables to have clear visibility AND better control of  processES across the supply chain system

IOT – The Internet Of Things- is becoming an important part of the business as most number of things such as appliances, utility items, products, packs and vehicles are being connected over the internet and collecting required data to arrive at key business decisions to improve operations.

  • It is heard that IOT spending will jump from approximately $700 billion in 2015 to $1.5 trillion by 2019.
  • Supply chain system is also one of the beneficiaries of the IOT solutions.
  • Each individual of the process such as packs, containers and transporting modes will be connected through IOT solutions for trace and tracking on real time basis.
  • It enables to have clear visibility and better control of processes across the supply chain system which will help
    an organisation to lead with an effective and cost efficient supply chain system.
  • As the supply chain system is highly diversified as per the industry, accordingly IOT operations will vary.
  • It is predicted that within a few years, digitally connected processes will show 10-15 per cent productivity improvements in the manufacturing processes.

    S V Veerramani
    S V Veerramani

Major advantages

  • Supply chain visibility
  • Operational efficiency
  • Better customer service
  • Better inventory management
  • Loss management

Important stages in the pharma industry where we can apply digitally connected processes are:

  • Manufacturing: Though batch manufacturing is the current practice in the pharma industry, we can deploy automation and controlled techniques for controlling men and materials movements to maintain safety and efficacy by enhancing visibility in various manufacturing activities.
  • Warehousing: It is an important subject of any organisation to avoid shortages, excess inventories, and wastages at
    parent company as well as all the locations it is present at various places. Here the technology becomes an essential option to have on line visibility through connectivity of various locations for better management of stock availability, facility optimisation, precautionary actions etc.
  • Transportation: In a supply chain process, timely availability of stocks at consumer point is a major challenging task. But, by adopting new age IOT techniques there is a possibility to have a control on the same by having time-to-time monitoring of movements of stocks/vehicles through the GPS system. This will enable us to monitor the vehicle and the driver’s performance and direct us towards optimised decisions with respect to repeated movement of stocks, reduced time to reach market and ultimately cost saving.

IoT is the panacea for risks that are inherent in supply chain

IoT has influenced the logistics function too in a big way and has presented many opportunities to the pharma industry the way it could improve its logistics operations.

An IoT-led ecosystem is bound to bring in more efficiency in the business operations especially in the supply chain. IoT is the panacea for the risks that are inherent in supply chain especially the ones that could result in costly disasters. Some of the benefits that can be realised by the implementation of IoT include:

Improvement in the visibility of warehouse operations

The needs of the hour is real-time visibility into warehouse operations without which it would be difficult to track products besides unviable wastage of warehouse space and also the temperature variations that could be an issue while handling sensitive products.  IoT-enabled smart warehouses having sensors and readers would increase visibility of operations in the warehouse and presents the data seamlessly to the warehouse managers by reporting data about the products and their condition so that business can take a supported decision.

Overcome short supply of drugs

Implementation of digital technologies like IoT ensures that there is stable supply of drugs so that the needy patients could get their drugs on time. IoT helps the managing optimum inventories based on the business rules that the companies define so that planned decisions can be taken about manufacturing and also assist in sending out the relevant products to the market.

Sanjit Singh Lamba
Sanjit Singh Lamba

Enhance supply chain security

IoT helps making the supply chain security more robust by facilitating bidirectional communication between the information seeker and the device, tracking of the inventory with respect to the location and the current status of the package in transit. Supply chain security can be ensured through 2D bar codes, RFID tags and smart labels for packaging. IoT helps in tracking the movement of drug inventory at every point can potentially save supply chain stakeholders millions of dollars while ensuring that genuine products are delivered to the customers while deterring drug counterfeiters.

Reduce product recalls due to product degradation in transit It is important to track the temperature of stored drugs in transit to ensure they remain stable and within acceptable ranges till they reach their destination. IoT-enabled packaging continually tracks environmental conditions in cold chains during transport – assuring product quality and efficacy with the usage of environmental sensors inserted into product packages/pallets in shipment containers. This would reduce wastage of drugs due to increase of temperature in the containers, ensure compliance with the regulatory requirements besides assuring quality of the products.

Drug theft during transit

Pharma industry has experienced losses due to theft of drugs in transit which resulted in the losses to the companies and also deprived patients of the timely receipt of drugs. Digital technologies such as GPS location and condition monitoring afford real-time visibility and security during transport. IoT enables the logistics team to analyse and compare data on progress of the cargo from anywhere. With the implementation of IoT solutions it is possible to reduce time to market, prevent product damage and waste, and lower carrying costs.


The pharma industry has high potential of adopting IOT and this could be in the patient  or industrial manufacturing space. Regulators and health providers including online pharmacies can empower people with intelligent devices to transmit data on usage, replinishments and usage habits; which will help the supply chain side of pharma industry.

Like in other industries which are now being driven by the digital technologies, pharma enterprises must constantly innovate and utilise emerging technologies to remain relevant, competitive, and profitable. As IoT is becoming more adaptable and its implementation makes the supply chains in pharma industry more robust while ensuring compliance to international regulations and meeting market needs. Surge in the number of software products and devices that are IoT ready the trajectory of adaptation of IoT is going to be only upward. The time is now apt for the pharma companies to quicken the implementation of IoT by utilising easily adaptable IoT platforms and their conforming solutions. The potential to make considerable strides in tightening the pharma supply chain is here, and the differentiator is the Internet of Things.

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