This is the challenge faced by a leading pharmaceutical company headquartered in Europe. A research project* at the Zaragoza Logistics Center (ZLC), Zaragoza, Spain, analysed the company’s multi-faceted inventory systems, and developed a model that helps the manufacturer to identify and prioritize opportunities for optimizing inventory levels and lead times.
Complex competitive environment
A number of internal factors complicate the company’s inventory and lead time management systems.
In broad terms, there are three main stages in the process to manufacture a finished pharmaceutical product. First, raw materials are converted into drug substances (DS); the active ingredients that make up finished products. Second, these active ingredients are turned into familiar items such as tablets, also known as drug products (DP). Finally, tablets and other product formats are packaged and become finished goods (FG).
