Pharma logistics embraces resilience amid supply chain risks

Pharmaceutical supply chains are increasingly prioritising resilience, risk management and end-to-end visibility over cost efficiency, as geopolitical tensions, unpredictable shipping conditions and rising transportation costs threaten the timely delivery of medicines.

The ninth edition of the Global Pharma Logistics Summit was held in Mumbai on 9 October. The panel featured Manish Agrawal, Head of Logistics, Kusum Healthcare; Surendra Deodhar, Vice President and Head of Materials Management, Reliance Life Sciences; Aldrick Dsouza, Head of Operations, WFS Bengaluru; Rajiv Hariramani, Director, Skyways Air Services; and Mithilesh Shetty, Director, Isa Logistics. The discussion was moderated by Sugeet Chopra, Executive Vice President, Supply Chain Management, Strides Pharma Science.

The shift was a key theme during a panel discussion on pharmaceutical logistics, where industry stakeholders examined supply chain vulnerabilities, the role of logistics service providers, the growing importance of alternative sourcing and the potential of artificial intelligence (AI) to improve operational decision-making.

Chopra who introduced the session as a pharmaceutical supply chain professional, highlighted the consequences of medicine shortages for patients. He cited figures indicating that the US Food and Drug Administration recorded 350 active drug shortages in 2024, with the number remaining close to 250 at the time of the discussion.

He noted that India, which supplies around 25% of generic medicines globally, has an important role in ensuring the continuity of pharmaceutical supplies. He emphasised that manufacturers and logistics providers share the responsibility of connecting medicines with patients, making supply chain reliability a critical priority.

Supply chain vulnerabilities extend beyond finished products
Panelists said pharmaceutical supply chain disruptions often originate much earlier than the finished-product stage, particularly when manufacturers depend on a limited number of suppliers for active pharmaceutical ingredients (APIs) and other critical inputs.

Geopolitical developments, changing trade policies, extreme weather and volatile freight rates can create disruptions that cascade through the supply chain. Participants also highlighted the risks associated with incomplete or exaggerated information, which can complicate operational planning and trigger unnecessary procurement or inventory decisions.

The discussion noted that manufacturers must look beyond outbound logistics to identify vulnerabilities in upstream sourcing, including the availability of APIs and key ingredients. Diversifying suppliers, expanding manufacturing capabilities across locations, and strengthening backward integration were among the approaches discussed.

Manufacturers are also reassessing inventory strategies. Rather than relying exclusively on just-in-time operations, companies are increasingly considering strategic buffers for products and ingredients that face higher supply risks.

The appropriate level of inventory depends on factors such as product criticality, shelf life, patient demand and the reliability of supply. Panelists stressed that pharmaceutical companies need to balance these requirements against the financial implications of maintaining additional stock.

From cost efficiency to resilience
The discussion highlighted a broader shift in supply chain strategy, with companies moving away from models focused primarily on low costs and operational efficiency towards systems designed to withstand disruption.

Deodhar said that businesses across industries were facing similar uncertainties, although pharmaceuticals carried additional challenges because of temperature sensitivity, shelf-life requirements and the consequences of medicines becoming unavailable.

He highlighted supplier diversification, strategic inventory buffers and multimodal transportation as potential ways to strengthen resilience. Manufacturers and logistics providers must also assess the risks associated with individual products and routes when deciding how shipments should move.

Multimodal transportation can offer alternatives when a particular route or transport mode becomes unreliable. However, panelists noted that not every pharmaceutical product can be shifted between modes without considering capacity availability, temperature-control requirements, and transit-time constraints.

Visibility must also translate into action. Knowing that a shipment is delayed or a port is congested is not sufficient unless companies have the operational capabilities and alternative arrangements to respond quickly.

Logistics providers face changing expectations
The role of logistics service providers (LSPs) is evolving beyond transportation and shipment handling, according to the panelists. Pharmaceutical manufacturers increasingly expect their logistics partners to contribute to supply chain planning, risk assessment, shipment visibility and disruption management.

The discussion underlined that the customers want more information about shipment locations, temperature conditions, transit times, and unexpected cost changes. This requires closer coordination among manufacturers, airlines, shipping lines, airports, ground handlers, customs brokers and transport providers.

Panelists also highlighted the importance of commercial transparency. Sudden changes in freight rates, surcharges and available capacity can make planning difficult for pharmaceutical manufacturers, particularly when margins are under pressure.

AI adoption depends on data integration
Artificial intelligence emerged as another area of interest, although panelists cautioned that its practical benefits depend on data quality, system integration and user confidence.

Shetty said that the supply chain companies were developing digital capabilities across their businesses, including warehouses, container freight stations and other logistics operations. However, information often remains fragmented across internal platforms and external partners.

For AI to deliver meaningful results, systems used by manufacturers, logistics providers, ports, airports and customs brokers must be able to exchange reliable information. Data integration can enable automation, while AI can subsequently help identify patterns, predict disruptions and support decisions on routing and capacity.