Pharmaceutical Distribution in the US: Current and Future Perspectives

Abstract

In the US, the pharmaceutical supply chain involves the daily delivery of approximately 13 million prescription products to pharmacies, hospitals, clinics and other healthcare provider locations.

In recent years, the US government and interested parties have made increasing efforts to protect the national supply chain for medicines distribution. Since it represents the means for medicines to reach patients, any breaches in the system would be catastrophic and could affect millions of people. The system faces numerous external threats, including counterfeiting, terrorism and disruption resulting from man-made and natural disasters. Industry challenges include the dominance of 3 wholesalers, growth of mail order and the wave of pharmacy consolidation.

The US supply chain is set to undergo great changes in the next decade. Although a number of external factors will have an impact, the complex relationship between each of the parties in the supply chain will be the most important. Although they all depend on each other for maintaining the supply chain, they all wish to have greater control of the process of delivering medicines to patients. Pharmaceutical manufacturers and pharmacists all have their own opinions regarding the structure of the supply chain, and their actions to reinforce their views will shape the future of the system.

Pharmaceutical Distribution in the US - Current and Future Perspectives from URCH Publishing, delivers a comprehensive and expert overview of the distribution of medicines in the United States. This 40,000 word report will provide the reader with accurate insight into this complex and rapidly changing sector.

• In 2008 the US pharmaceutical wholesale market was worth $275bn
• McKesson, AmerisourceBergen and Cardinal Health Inc, known as the ‘Big Three' , account for between 90-95% of revenue within the US pharmaceutical wholesale sector.
• The ‘Big Three' have been responsible for over 100 buyouts since 1980, at least 57 of which have occurred over the past decade.
• It is estimated that US chain drug stores currently account for 41% of all prescription sales, with the dominant players being Walgreens and CVS Caremark.
• A change from wholesale to direct distribution in the US is unlikely. A US wide direct distribution model would cost the pharmaceutical industry $47.9bn to operate. This would be 15.5% increase on current distribution costs.

• Understand the environment for medicines distribution in the US.
• Identify where the sector might change in the next few years. Analyse threats and opportunities.
• Spot potential areas of pharmaceutical distribution market growth and opportunities for delivering successful sales growth

• Efforts to protect the medicines supply chain and disaster plan, in particular to deal with counterfeiting.
• The 3 major wholesalers AmerisourceBergen Corporation, Cardinal Health and McKesson Corporation and the growing concern about their dominance.
• The sophisticated technology that underpins distribution in particular EPoS, Barcoding and RIFD
• The practice of pharmacy and the main players in the pharmacy sector and current issues regarding dispensing including Rx-to-OTC switching, patient compliance and biogeneerics.

• American Pharmacists Association
• AmeriSource
• AmerisourceBergen
• Bergen Brunswig
• Boehringer Ingelheim
• Cardinal Health
• Centers for Medicare and Medicaid Services
• CVS Caremark
• Food and Drug Administration (FDA)
• GlaxoSmithKline
• Informed Decisions, LLC
• K-Mart
• Lewin Group
• McKesson Distribution Solutions
• Nadro
• National Association of Chain Drug Stores
• National Community Pharmacists Association
• Pfizer
• Pharmaceutical Research and Manufacturers of America
• RxHub
• RxUSA
• Sanofi-Aventis
• SureScripts
• Verispan
• Walgreens
• Wal-Mart Target
• Wegmans
• Wyeth

About the Author

Dr Faiz Kermani has over 15 years' experience in both academia and the pharmaceutical industry. He has worked in pharmaceutical R&D, pricing and reimbursement, marketing and medical education. Dr Kermani holds a PhD in Immunopharmacology from St Thomas' s Hospital, London, and a First Class Honours degree in Pharmacology with Toxicology from King' s College London. He has written extensively on international healthcare issues, and is on the editorial board of a number of publications. In March 2006, he was a delegate on the UK Government' s Trade and Investment Biotech Scoping Mission to China and contributed to the subsequent report.