Transforming
Life Sciences
How procurement and supply chain management are driving change
Life Sciences:
An Industry Facing Unprecedented Disruption
The life sciences industry is at the epicenter of seismic change. Even before the accelerating effects of the global pandemic, patient demand for personalized medicines and therapies was growing. Regulatory pressures on health, energy, and sustainability continued to build. Supply chains were becoming more complex with a network of research partners, co-manufacturers, and global suppliers.
As a result, procurement and supply chain management are now boardroom priorities and playing an increasingly vital role in driving digital transformation. Explore how next-generation practices powered by intelligent technologies can help companies like yours grow profitably and sustainably.
Of pharmaceuticals and life sciences CEOs believe over-regulation could sidetrack growth prospects1
Improved efficiency through real-time, automated collaboration with suppliers2
Of pharmaceuticals and life sciences CEOs identified that technological advances are transforming their business3
Four Key Business Outcomes
Sourcing and Contract:
Key Challenges and Opportunities
Engage with suppliers earlier in a closer and more collaborative way to share innovation opportunities, increase supply certainty, improve sustainability, and identify potential cost savings.
Challenges
- Gaining better visibility and understanding of the supply base
- Identifying supplier sustainability ratings
- Leveraging sustainability criteria during the selection/souring process
Opportunities
- Access a global network of suppliers meeting sustainability criteria
- Use sourcing capabilities to develop a more sustainable supply mix
- Monitor suppliers’ ESG compliance over time
Challenges
- Addressing high demand and constrained supply
- Responding to supply and demand shifts and shocks
- Becoming the supplier’s preferred vendor/customer
Opportunities
- Gain greater visibility of key supplier performance metrics
- Collaborate better on inventory, payment terms, etc.
- Leverage analytics to measure, monitor, and improve
Challenges
- Tracking product quality, safety, and yield
- Measuring on time, in full (OTIF) delivery performance
- Orchestrating multi-tier suppliers
Opportunities
- Gain better visibility into the supplier base
- Increase network-based collaboration
- Reduce inventory levels while increasing fill rates and productivity
Plan and Forecast:
Key Challenges and Opportunities
Accelerate clinical trials, respond quickly and effectively to changes in supply and demand, and support new outcome-based business models with an integrated approach to supply chain planning.
Challenges
- Dealing with increasing trial numbers and growing complexity
- Identifying and enrolling suitable patients
- Improving collaboration among all supply chain participants
Opportunities
- Increase efficiency and reduce cycle times
- Ensure 100% availability of supplies to avoid inventory outages
- Get greater visibility across the whole clinical trial value chain
Challenges
- Getting rapid and accurate demand and supply signals
- Responding quickly and effectively to changes
- Integrating with supplier planning systems
Opportunities
- Achieve end-to-end integration of internal and supplier planning systems
- Leverage a business network to enable integrated planning
- Get early visibility into demand and inventories
Buy and Deliver:
Key Challenges and Opportunities
Reduce procurement costs, drive compliance, and improve customer satisfaction through better information sharing and collaboration with suppliers. Manage inventory more efficiently across the business network.
Challenges
- Getting detailed information from external and internal organizations
- Reducing inventory levels and increasing fill rates
- Improving working capital
Opportunities
- Get real-time visibility across the business network
- See inventory and production status at third party manufacturers and raw materials suppliers
- Use advanced analytics to measure, monitor, and improve key metrics
Challenges
- Improving on-time shipment performance
- Responding quickly to changes in supply and demand
- Identifying potential issues before they affect customers
Opportunities
- Get real-time visibility across the business network
- See inventory and production status at external manufacturing partners and suppliers
- Use advanced analytics to measure, monitor, and improve key metrics
Invoice and Pay:
Key Challenges and Opportunities
Invoice more accurately and automate your accounts payables processes to improve cash flow, reduce revenue loss, gain better financial visibility across the business network, and keep suppliers and customers happy.
Challenges
- Capturing errors and exceptions before they reach accounts payable and procurement
- Providing real-time access to PO, invoice and payment status
- Moving to touchless invoice processing
Opportunities
- Reduce exceptions with pre-validated invoices
- Decrease expedited transactions and costs
- Increase touchless rates with inter-connected capabilities
Challenges
- Capturing all margins related to research programs
- Managing project margins across all participants
- Reducing opportunities for incorrect payments
Opportunities
- Improve budgetary controls across the business network
- Provide notifications when projected costs exceed predefined tolerances
- Increase spend transparency and improve compliance
How Life Sciences Customers Are Achieving Value from SAP Solutions
Learn More About
Procurement Software and Solutions From SAP
Reduction in R&D cost using cold-chain biopharma outbound logistics4
Increase in on-time delivery performance using recipe development and formulation5
Reduction in procurement cost using demand-driven MRP6
Increase in patient satisfaction from targeted treatment therapy management7