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MSU Research Center in the Fight Against Phony Pharmaceuticals

Pharmaceutical drugs in supply chain
David Closs

David Closs, professor of supply chain management in the Eli Broad College of Business, is helping to make this complex tracking possible through his work with MSU’s Axia Institute, a research center that helps its partners find solutions for value chains.

Faculty from Michigan State University play an instrumental role in ensuring the pharmaceutical drugs we take are delivered through a safe supply chain.

New federal rules require companies to track prescription drugs from their raw materials stage to their delivery to pharmacies, which involves detailed coordination between suppliers, laboratories, distributors and pharmacies. David Closs, professor of supply chain management in the Eli Broad College of Business, is helping to make this complex tracking possible through his work with MSU’s Axia Institute, a research center that helps its partners find solutions for value chains.

“In this particular case, it’s important because the pharma industry is trying to solve problems that are inherently multidimensional,” Closs said. “Shepherding raw materials through development, to pharmacies and eventually into the hands of consumers presents many challenges.”

Recent legislation has put a greater onus on companies to keep track of materials to prevent counterfeit, stolen or contaminated drugs from sophisticated criminals.

“Historically we may have just looked at, for example, what’s the lowest-cost solution. That‘s important, but that’s not the only issue we have today,” Closs said.  “We also have to protect the product and reduce the chance of counterfeit products. There are multiple ways that these products could be adulterated, which requires multiple dimensions for protection. This requires firms to involve expertise from many different areas and jointly develop a solution.”

The Axia Institute, of which Closs is the founding faculty director, is partnering with the pharma industry to solve challenges and conduct cross-disciplinary research in the areas of value chain optimization, data analytics, engineering, smart packaging, anti-counterfeiting, and water and food safety.

Axia hosted a “Pharma Forum” with representatives of many of the major pharmaceutical companies late last year at Axia’s headquarters in Midland, Mich.

“The rationale behind the Pharma Forum was to bring in the major drug companies – we had six of them there – and say, ‘this is a problem you’re all facing and it’s not something you can compete with.’ If Pfizer does it or if Lilly does it, they are not going to have a competitive advantage,” Closs said. “This is an example of a supply chain change that will make it better for everybody if we work together because it will be less costly and more consistent.”

Closs explained that Axia has been researching packaging pharmaceuticals, drug value chains and what drives the value chain performance.

“There is a significant concern in the pharmaceutical industry regarding counterfeiting and the black market; any way you can illicitly get drugs into the consumer’s hands, it’s something that’s very high-value. It’s hard for the consumer up front to make a judgment as to whether or not their meds are adulterated,” Closs said. “In Axia, from the beginning, we’ve focused on value chain and reducing value chain risk, which includes things like counterfeiting, packaging, black markets, grey markets – all the ways you can falsely get the product to the consumer.”

The pharmaceutical industry is an ideal place for crime because it is includes expensive products, Closs explained. To keep consumers safe, companies must protect the value chain from end to end

The Pharma Forum was the start of the process in finding solutions to these issues. Axia plans to work with its forum partners throughout 2019 in that quest.

  •  Omar SofradzijaDavid Closs via MSUToday

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