Successful Serialization Partner Selection

By Michael Howe, CEO, Verify Brand | March 7, 2017

Can speed, business value and total cost of ownership exist in the same space when compliance cannot wait?

November 2017 is rapidly approaching and with it, the deadlines for the Drug Supply Chain Security Act (DSCSA). As pharmaceutical contract manufacturing organizations (CMOs) and re-packagers and third-party logistics (3PL) providers check the final boxes before implementing serialization, there are a number of considerations to address during vendor selection.

Each company is at a unique place in this process. Some have already implemented serialization while others are still struggling to understand what to look for in a partner or platform. With a priority on fast implementation and compliance, it’s important not to lose sight of other factors critical to long-term success, namely total cost of ownership and value to the business.

Fast-turn implementation
If you fall in the category of “still deciding,” one of the first questions you need to ask your serialization partner is “how long will this take?” Depending on your existing systems, serialization isn’t just one project—it’s a series of changes that include evaluating partner systems and integration points, modifying packaging lines, rolling out software, completing hardware validations, training staff and more.

When evaluating partners, talk to each of them about the timelines of similar companies with equivalent volumes, foundational software and hardware systems, or partners. Then back out your own timeline, leaving room for testing and training.

If your potential partner only offers visibility into their own part of the process, they probably won’t provide any assistance when it comes to optimizing your partner networks or getting reports that consolidate data across systems. While they may advertise what appears to be a “fast turn” implementation, make sure that you take all other factors into account.

A more realistic approach is to find a partner that creates true end-to-end visibility across your supply chain and is experienced guiding companies through the entire serialization data exchange process. In addition, a partner that has experience implementing serialization across both pharma and non-pharma environments will be able to offer unique solutions that are customized to your business. They aren’t going to try to negotiate you into an off-the-shelf pharma solution.

If a partner promises a timeline that seems too good to be true, don’t be afraid to challenge it. Chances are they are only looking at their role, and not taking into account all the steps required to meet your goal.

Managing total cost of ownership
Managing any project for total cost of ownership (TCO) can be complicated, especially if you don’t understand or have visibility into all the moving parts. This is another area where your serialization partner can be a huge asset.

First, pharma companies should strive for clarity when evaluating serialization platforms. Focus on the terminology used with each platform. For example, there’s a major difference between an “on-premise” and a “single tenant” platform. With an on-premise model, the entire solution resides within the pharma brand’s enterprise, which can increase the infrastructure costs for the business. However, in a single-tenant model, the solution is hosted and supported by the service provider, so there are no costs for hardware, maintenance or solution management.

Another method to keep in mind to avoid hidden costs is to ask your most challenging technology questions early in the process. During the proposal phase, it is vital to inquire and confirm that the partner can describe all technology-related fees that might not be top-of-mind, including partner on-boarding fees, charges per serial number and user administration and system monitoring fees. For example, if you are considering customizations to the platform, ask your potential partner if they charge professional services fees every time you customize components of the application. Ensuring a flexible and configurable architecture is your end goal, so it’s important to know how these incremental costs may impact your ability to modify the system in the future. 

Working with potential providers to determine partner and network capacity and integrations can also involve fees. Will their solution work with your organization over time as you add or modify integrations? The answer to all these questions will impact the platform TCO, so pay attention to how vendors answer these questions.

Determining associated costs for support, training and upgrades will also define the right platform for your business, and can also help you manage whether your investments are focused upfront or will continue to build up over time. 

For example, with some platforms, the serialization provider dictates the time and number of ongoing software upgrades. This means that any associated validation costs for the system are entirely up to you, but you’re bound to the serialization provider’s schedule. Not being able to manage your own upgrade and re-verification schedule can drive up costs for staffing and impact productivity.

It is also important to remember that avoiding excessive TCO is a two-sided equation. It’s easy for companies to focus on calculating the costs, but don’t forget about the savings. Using a serialization solution that will save you money throughout your entire business is going to provide the ideal, long-term TCO.

Value beyond compliance
Yes, compliance is the end goal. But why give up future business value just to get something implemented quickly? You can have both—and it won’t take you any longer to find and implement than compliance alone. 

Serialization impact goes well beyond track-and-trace and keeping stock of item and lot-level packages. It can provide insights into item-level data that not only helps keep track of saleable units but also reduces potential losses and process inefficiencies.

For example, with precise track-and-trace data, we can now understand the exact number of salable units produced on any given day, within a specific range of hours and on any production line. Insights can also be generated for dwell time or the time it takes to get items through a location, allowing for greater decision-making on how quickly product moves through the supply chain. Insights also help identify possible bottlenecks in the process.

A serialization platform can help you understand item-loss disbursement due to quality issues and general process inefficiencies to focus on reducing these problems directly in your supply chain and partner network.

As you are identifying a serialization platform for compliance, ask them how they’ll create value after you check that compliance box. Have them describe their efficient and transparent implementation process that helps you connect your entire organization to meet compliance requirements but also drive efficiency throughout your supply chain.

With the right partner and platform, you’ll get everything you need: compliance, simplified integrations and the building blocks for a platform that can set your business up for future enhancements and better business insights.

It’s a team decision
As you review all the elements that go into making a serialization decision, don’t forget that this isn’t a decision most companies make separate from your trading partners. Because DSCSA requires all companies along the drug supply chain to ensure traceability of products within their operations, it’s often necessary to audit all potential integrations along the chain to determine how you’ll create end-to-end visibility, traceability and compliance. So what do you need understand to make an informed decision?

Each of your pharma clients and trading partners will expect to receive data from the tracking events you capture. Conversely, you may need to accept or receive data from them.
So, the most important thing to understand is the content of the data that needs to be exchanged with trading partners. Questions to ask your partners include:
  • Exactly what critical, tracking-event data do they expect to receive from you? Then consider how this compares to the data you plan to capture and make adjustments as necessary;
  • Do you and your trading partners have agreement on the identifiers to be used in the data? For example, are you all using serialized global trade item numbers for product identification and global location numbers for party and location identification?; and
  • What master data needs to be synchronized with each partner? Required master data might include trade item attributes, such as drug name, dosage form and dose. Required party and location master data usually includes name and address information.
Bear in mind that your partners may also be at an early stage of understanding their own requirements. It is essential to dig deeply and question whether your partners are providing all the necessary detail so there are no surprises as you get closer to the deployment deadline.

After agreeing on data content, there are a number of more technical issues that have to be addressed in order to achieve smooth interoperability with partners. A common theme is adherence to widely accepted industry data standards, especially if you are interfacing with multiple partners.

Don’t assume that your IT systems and partner systems will interoperate—it’s important to prove this through testing. With limited time left to implement and test systems, the more you can prepare by understanding the systems involved, the faster you can get to the testing stage.

The role of data standards
We’ve shown that it’s possible to find the right serialization solution that offers fast implementation relative to your existing system and needs, meets your TCO goals, and provides value above and beyond compliance. So, is that all there is to consider?

Not quite. Another important consideration for your platform is the role of data standards. One of the most challenging elements of any serialization project is effectively managing integration points with partners, such as contract manufacturers, 3PL or government agencies. Successful integrations rely on the ability to connect and align various networks seamlessly, which makes data standards important.

GS1’s EPCIS standards allow pharma companies to communicate with trading partner networks. GS1 members continually work to improve the standards as newer regulations are put in place around the world.

Leveraging the GS1 EPCIS standard is critical for efficient and optimal integration among partners and customers. But not every provider has the ability or the willingness to support these common technology standards and will lead you to believe that standards are a “nice to have.”

With the mountains of data collected through serialization, having a partner that can compile and translate data into meaningful insights is key to creating knowledge within your organization. This is much more than a “nice to have,” in fact it’s becoming a critical part of a company’s ability to compete and gain market share.

As you interact and communicate with network partners, it also requires end-to-end visibility. Having a serialization platform that does not use a common data-exchange language can reduce visibility throughout the supply chain and leave you open to risk that you cannot see.

Standards are critical. These standards provide a common environment where the platform can analyze and pull meaningful insights that can later be shared throughout the network, increasing both upstream and downstream communication. Identifying a serialization partner that can leverage EPCIS standards, including recent updates (e.g., version 1.2), will provide short-term benefits and reduce potential problems down the road.

So, be mindful of platforms and partners that don’t support and deploy standards-based solutions, as they can increase integration and TCO as you and your partner work to maintain efficient integrations across networks that don’t speak the same language.

While it is not required to follow standards, leveraging standards can increase your business’s competitive edge relative to other companies that are limited to basic connection points. Insights rather than connectivity is the real value from serialization and a critical component for building an intelligent supply chain.

Reducing complexity and focusing on quality
Meeting the upcoming DSCSA guidelines is a challenging endeavor for pharma companies and their partners throughout the supply chain. Not only do companies need to select the right partner, there are important costs and benefits to discuss before implementation.

Selecting the right platform is a combination of partner experience, price and determining the right integration approach for your current and future business needs. There is no one-size-fits-all platform. Using the right standards that produces impactful insights will help you meet compliance and extend value throughout your entire organization. The modern supply chain is often complex, and many companies wonder if serialization will equally require a complex and difficult-to-understand platform. That’s not always true. Working with your serialization partner to discuss network and supply-chain capabilities will ensure that in addition to creating value up and down the supply chain, you check the compliance box along the way.

Another critical consideration is eliminating the hidden costs and reducing your overall TCO. Asking the right questions before you implement a solution can save time and money as you begin the process.

Time is ticking on the DSCSA compliance clock. Whether you have already selected your partner or are still in the hunt, it is important to actively engage with potential vendors to determine that they will help you reach compliance and also prepare you for growth and success in the future. 

Michael Howe is chief executive officer for Verify Brand. As a pioneer in creating disruptive innovations, Michael leverages his decades of experience with Fortune 100 companies and other leading brands to help pharma companies integrate serialization technology to drive business growth.

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