IoT: now the hype is over, what next?

The IoT (internet of things) is now commonly talked about in almost all industry sectors. Everyone is talking about connecting devices and using the data to do something meaningful with it – whether it’s in healthcare, logistics, manufacturing, retail, or any other system that could benefit from a ‘feedback loop’.

According to the Gartner hype cycle, IoT is almost at the peak of inflated expectation (see chart below), but in my opinion, it is already over its peak – IoT solutions have existed for over a decade, with Dyzle’s cold chain monitoring solution being evidence of this, which has been established for a while.

So now that the hype is over, what is next? What can we realistically expect from IoT now?

Well one thing is for sure – we already have the beginnings of a new hype cycle with new network technologies like LoRa and Sigfox. They promise low cost hardware and long battery life, as outlined in my earlier article ‘IoT in the last mile for drug delivery: balancing technology and cost’. As I mentioned in this, new IoT technology solutions are being launched all the time, but networks are not always fully rolled out, so coverage in practice is often limited. It could be some years before such networks become ubiquitous and provide the same level of coverage as mobile networks do currently, and especially indoors.

So LoRa and Sigfox are possibly at the stage where RFID (radio frequency identification) technology was in the 1990s. There were high expectations and many possible use cases, but in reality, it didn’t really become viable for widespread use until about 20 years later. Is this the same case now?

Returning to the question of what’s next with IoT, we have to consider the types of applications – whether it’s simple or complex IoT.

IoT simple use cases

There are many examples of simple use cases for IoT where there are growing multiple market applications already rolled out. These include:

• Garbage bins in the city, where they can indicate whether they are full or empty, enabling city resources for waste collection to be optimized, and potentially reducing costs.
• Smart vending machines, which offer benefits to both customers (such as reserving drinks before going), as well as retailers and operators, who can replenish supplies only when the vending machine indicates it is close to being empty (see this example).
• Smart parking, which can tell you whether is a parking space, whether in a car park or off-street, is free before even getting there (such as this one in Perth, Australia, or this one in Milton Keynes, UK).

Many of these simple IoT applications are characterized by the fact that low reliability is not an issue, that there are low amounts of data, and few measurements per day. The challenge though is network coverage and also indoor signal coverage.

IoT complex use cases

Complex IoT use cases include:

• Monitoring of critical parameters of goods in a supply chain (such as temperature sensitive pharmaceutical and food products).
• Predictive maintenance in a plant (often as part of an industrial automation system), enabling spare parts being delivered to machines before any failure or downtime occurs.
• Patient monitoring (such as the scenarios I described in a previous article on IoT for ‘hospital-at-home’)

The characteristics of such complex IoT systems are that they need robust solutions, reliability of data (they can’t miss a data sample because the measurements are often of critical parameters), and in the case of ‘excursions’, they need to be triggered to provide even more data and possibly even different types of additional data.

Achieving this is not yet possible with current network technologies. The question then is going to be: will NB-IoT (narrowband IoT), when it becomes a global standard, meet the expectations of such complex IoT use cases? That is yet to be seen.

So what should you expect from IoT today?

Looking at the Gartner hype cycle, it suggests that IoT will take between 2-5 years to come to its plateau of productivity. I agree with this. When NB-IoT networks and the technology (ie: the chipsets), become more mature and widely available, then this will really see IoT take off in a big way, especially for some of the complex IoT use cases. This is because they’ll then be able to deliver high value compared to the low cost of implementation.

But there is no real need to wait for that to happen. There are already multiple IoT solutions available on existing technologies (some might say old) such as GSM, GPRS and Wi-Fi; in most cases their robustness is proven. And let’s not forget, that even the space shuttle was using Intel 8086 chips for almost 20 years – so it wasn’t exactly using leading edge technology, but instead using older, tried and tested chips.

The existing solutions also help meet market conformance standards – such as computer system validation (CSV), a requirement in the pharmaceutical industry.

There is a lot more mileage left in these solutions for entire supply chains both in the food and pharmaceutical industries, where the value can be harvested probably for at least the next five years.

When these systems have served their purpose, and created their value, the next stage will be more advanced IoT solutions creating even more value. Especially since you’ve already built up a wealth of experience because you have the experience from implementing systems using existing technologies and learning how to benefit from it.

So, yes, the hype is over. And now is the time to reap the benefits of IoT using existing technologies over the next five years or so. That way, you’ll be much more ready for the hype cycle of the next generation technologies to reach their peak of inflated expectations.

 

 

 

Logistics 2017: connecting the dots between IT systems to make sense of the data

by Rene Tjong Tjin Tai

With the growth and use of technology and multiple IT systems in logistics, it is proving demanding for many to work out how to connect everything together to make sense of disparate sources of data and information. It can be a daunting task for many logistics managers, especially if you are not a technologist or IT-savvy.

In this article, we outline some guidelines on how one can approach the task of integration of IT systems in order to make it meaningful for the business.

The growth of IT for multiple use cases

The last decade or so has been about introducing IT solutions in to various parts of the logistics industry. Most have a positive business case for a specific challenge. These systems have now been established for a long time and have proven their value, such as:

• Fleet management systems
• Transport management systems (TMS)
• Warehouse management systems (WMS)
• On-board computers
• Track & trace systems
• Temperature monitoring systems

However, we now increasingly see a demand for connecting all these systems. They work well on their own, but management like to see ‘the big picture’ while also making the information meaningful to others in the supply chain, including for customers.

We have seen examples like:

• Integration with TMS systems
• Integration with track & trace systems and other (IoT – internet of things) sensor vendors
• Connecting between logistics service providers (LSP) and 3/4PL.

Lots of data: the need to make 1+1 =3

With all these individual IT systems comes something else: lots of data, or big data as those in the tech industry tend to call it these days. With so much data being created, how do you combine this data to create value, or save time, or make processes more efficient?

They key is to have the right data in the right place at the right time so it can effectively be accessed or used when the customer:

• wants an update or wants to see the data at any particular point in time
• calls the customer support desk
• calls to talk about the status of a shipment or order

Typically, the customer support system would ideally enable someone to enter the order number or shipment number and then be able to view the temperature and track & trace data based on that number.

Translating this to business information needs, product quality or integrity can be checked using the temperature data; product location is identified by the track & trace data in the fleet, transport system (TMS) or warehouse system (WMS).

By bringing this data together either in the ERP system stored centrally or in the customer support system, it then becomes easy to get the big picture at any time simply by entering the customer identifier or order/shipment number.

With integration of data in one place, this can provide the big picture proof of quality of your logistics services – and can even be delivered with your invoice to the customer!

Whatever the use case, in all cases the methodology is the same. The questions that need to be asked and addressed are:

• who needs the data and for what purpose?
• in what system is the data needed (ie what system is the person using most of the time)?
• in what format is the required data to be presented (the person reading the data needs to be able to understand or able to explain what he or she sees)?

Help – I’m not an IT guru!

So how do you get to this point where all the data is easy available at one central point? The key is to ask the right questions and select your vendor carefully. Here we offer some guidelines.

The first step is to set your goals or objectives as described above (eg. who needs the data, what for, where is it required, and how is to be presented?). It probably helps to draw a picture and map everything out like this:

 

Vendors need to understand your business and the process as described, not just sell you a piece of technology. It’s important to understand that no one vendor has 100% of the market or the solution, or 100% global coverage, so they need to show willingness to cooperate with other vendors.

Vendors will then need to be able to connect their systems to other systems in an appropriate way with a so-called ‘API’ (application programming interface). They need to specify what needs to happen within their solution – and put the pieces together in one proposal in a way that you can understand, in your language, not ‘IT speak’.

Ultimately as the logistics provider to your customer, you should define what the result you are looking for from your IT solution vendor, and only pay based on the result that meets you and your customer’s objectives. Finally, be demanding: they are the specialists, so they should take care of you and understand your needs.

In conclusion, you may not be an IT specialist, but in an age when IT systems and technology are becoming more prevalent, it’s important that you define clearly what you need and ask the right questions of your vendors. Only then will the systems be connected in the right way to help you serve your customer more effectively, with relevant information and proof of product quality at your fingertips.

 

Data is the key to unlocking value from IoT in pharma logistics

by Rene Tjong Tjin Tai

As highlighted in my previous post, the internet of things (IoT) is not new: our industry may just be talking about its use now, but the technology upon which it is based has been around for a long time, and some companies have been delivering such technology solutions even before it was labelled as IoT.

The scope of IoT spans the entire pharmaceutical supply chain – from manufacturer to pharmacist. However, it is still being considered in a very limited way. Many companies still don’t see the real potential promise of this technology – they might just be looking at it from the viewpoint of having connected devices that simply demonstrate compliance.

Yes it does help provide proof of integrity, but there is so much more that you can do with the goldmine of data that the IoT offers. In this article we explain how IoT is being used now, as well as the potential benefits from better utilization of the data collected.

There are many suppliers today that provide solutions such as temperature, humidity and door sensors on every asset in the pharmaceutical supply chain. These sensors connect to a global mobile network that transmits data to a central database, and a dashboard is often provided with a real-time view of what’s happening in the field.

This technology can be built into in the entire supply chain – from warehouses, trucks and inflight containers, to delivery vans, local hospitals and pharmacies. The main goal, as mentioned earlier, is to deliver temperature information, proof of product quality, real-time alerts of any transgressions outside a given safe range, and proof of compliance.

But data can offer so much more business insight

So we have established that data can help with providing proof of integrity and compliance. However, the dynamics of real-time or ‘live’ data provides significant additional insights into the daily business. It’s also referred to as big data. And as one paper, ‘Big Data Analytics in Supply Chain Management’ suggested at a conference two years ago, big data analytics offers vast prospects in today’s business transformation. There is a myriad of premises that big data analytics can play more crucial roles in supply chain management.

The paper concludes that good use of data offers substantial efficiency improvements to existing processes with minor modifications, as well as being able to understand problems functionally in the supply chain. It argues that in order to succeed data should not just be considered as an information asset but as a strategic asset. By doing so, organizations could realize the economic value inherent in the data and the potential to capitalize on it in supporting revenue generating activities.

Take as an example, the monitoring of vaccines in a refrigerator. You see a regular temperature spike which occurs every day at around 8:30 – indicating the opening of the refrigerator door at that time. But say on Friday it happens instead at 9:30.  Now, if a process requires rigid time keeping in administering the vaccine, this would certainly flag up an irregularity in the process on the Friday, and would then help to advise relevant staff or remind them of the process requirements.

In another example, continuous measurements can help show the maintenance status of a cooling unit. If there are longer defrosting cycles, this could mean maintenance is needed. The fact that we are able to see this live means we can act in advance to prevent loss later on, or prevent expensive repair bills for when a breakdown eventually occurs, maybe outside office hours.

These kinds of insights can help to increase efficiency or to prevent loss. What’s better is that this data can be combined with track and trace information, and integrated with the order systems, ERP, TMS and WMS, to give proof of GDP and serialization.

It is widely considered that IoT will certainly shake things up in the pharmaceutical supply chain. It will ‘take supply chain visibility to whole new levels’ according to some commentators. And according to a DHL and Cisco report on the IoT in Logistics produced in 2015, IoT enables logistics providers to unlock higher levels of operational efficiency, while creating customized, dynamic and automated services for their customers.

The concept of IoT is not just the measurement of one parameter of an asset. Its purpose is to connect an asset so that every vital parameter can be made available (eventually). The business benefits tactically and strategically from harvesting the data that is generated could be significant. In addition, the use of technology networks and components will open up more possibilities with IoT in the future. We’ll cover that as well as the important issue of delivery to the home of the patient in my next post.

How IoT technology will address challenges in the changing pharmaceutical supply chain

The pharmaceutical and life sciences industry is facing ongoing pressures due to factors like drug pricing pressures, how to fund new innovation, growing demand for global healthcare access, and personalized medicines resulting from emerging digital and analytical capabilities. In addition, regulatory and compliance requirements are always changing and becoming more stringent.  In this article we look at how connectivity of everything (also known today as the internet of things, or IoT) involved in the supply chain changes the challenge.

It’s a given that healthcare costs are increasing, but pharmaceutical costs are under pressure. A report from PwC highlights the industry dilemma and challenge: despite growing healthcare demand, governments face mounting pressure to cut the cost of care. In addition, with greater public awareness of drug safety and security, this will also result in increased regulatory compliance requirements – with guidelines on Good Distribution Practice already in place, and serialization which will come into force as a result of the USA’s Drug Supply Chain Security Act, expected to be enforced by 2023.

Regulations also evolve to continually improve medicine integrity and safety. To illustrate this, the European Medicines Agency recently issued new good manufacturing practice (GMP) guidance to ensure the integrity of data generated in the process of testing, manufacturing, packaging, distribution and monitoring of medicines. Regulators rely on these data to evaluate the quality, safety and efficacy of medicines and to monitor their benefit-risk profile throughout their life span; hence controlling of data records helps ensure that the data generated are accurate and consistent to support good decision-making by both pharmaceutical manufacturers and regulatory authorities.

Another dimension of the challenge facing the pharmaceutical industry is the fact that their supply chains are now global, and highly interconnected. This puts pressures on optimizing costs and improving information flow in the supply chain – from packaging and warehousing, to transport and logistics and last mile delivery.

How and why IoT will be relevant in addressing these challenges

In order to address these challenges, technology can significantly improve the bottom line, including in the supply chain. Everyone is talking about ‘IoT’ but here we explain the concept and its relevance in the pharmaceutical supply chain.

The IoT is a complete closed loop system, comprising wireless or mobile connected sensors, a central database, dashboards, and business intelligence with feedback loop. In such a system, sensors in the warehouse or on a vehicle collect the data and transmit this data to the cloud or central database via a mobile connection.  The data in its raw form doesn’t mean much, which is why it’s necessary to have software to interpret and analyze the information, so that it can be presented via relevant dashboards back to the manufacturer or logistics service provider to show, in real-time, if the medicines are within the prescribed temperature range, or if corrective action need to be taken to maintain efficacy.

In addition the data collected can also be fed into a business intelligence (BI) system or enterprise resource planning (ERP) system, which then becomes part of the management information system to ensure business processes are monitored and optimized, and also capable of being part of the documentary evidence to demonstrate regulatory compliance and product integrity.

The result of implementing an IoT system like this is that there is full visibility of all connected items. An integrated system can give a view of the entire supply chain, and help address the challenges mentioned at the beginning of this article.

How IoT enhances GDP and serialization

For example, it meets the serialization requirement to track and trace products. Serialization provides absolute traceability, sometimes down to individual packs of medicines; by providing this level of detail for the entire supply chain, it makes companies accountable, and enables them to act with confidence and speed should a recall be required. It also ensures that a pharmacy or distribution point can be identified and informed quickly and effectively if any problems occur, reducing the level of risk in the supply chain.

This in turn provides better insight into the supply chain, which is currently mostly a ‘black box’, in real-time. This can help increase efficiency, and ultimately provide cost savings in the supply chain too. Intelligent use of data is a key part of the drive to optimize costs and deliver proof of product integrity.  The IoT solution comprises sensors, data, and analytics, together with business intelligence helps integrate data across all parts of the supply chain in one system to provide a complete overview and evidence of integrity.

In addition, this helps automate the process of meeting GDP and other regulatory requirements, since a technology solution that automatically records relevant data and is validated as part of a compliant process can significantly eliminate a lot of paperwork and manual documentation requirements.

Technology like this is already playing a part in helping automate the process of measuring data, but the systems in place are often not part of a completely integrated business intelligence system across the whole supply chain. Pharma companies and their logistics service providers could optimize the system (and therefore costs) by sharing data from each part of the supply chain in a single view.

Such IoT solutions are not new

While the industry might just be talking about IoT in the pharmaceutical supply chain, the technology upon which it is based has been around for a long time, and some companies have become experts in delivering the technology solution, even before it was labelled as IoT.

Dyzle is one company that has been delivering such advanced technology solutions for supply chain visibility for 10 years, implementing compliant solutions and working with pharmaceutical companies and logistics service providers to deliver tech solutions based on IoT technologies.

One of the challenges that many of our customers have found is that they know they need to use technology, but are not necessarily sure how it can be used in their use case, because they don’t necessarily understand the technology. This is where Dyzle developed a domain expertise, in IoT-based technology solutions for the pharmaceutical and food supply chains.

We have evolved our solution over the years to provide real-time temperature monitoring capability across the whole supply chain, comprising sensors central database, dashboards, and integration into business intelligence systems. In doing so, this helps big pharmaceutical and food companies and their logistics services providers unlock the value of the IoT and big data in their supply chains in a compliant way, and delivering proof of product integrity.

Such IoT solutions will increasingly play a greater role than they are at the moment in the pharmaceutical supply chain, helping provide more visibility and in turn ensuring and demonstrating proof of drug integrity for temperature-sensitive products. In summary, as the pharmaceutical industry considers how to meet the challenges of pressure on prices and increased regulations, the use of connected technology solutions will help them optimize costs, ensure compliance and ultimately ensure patient safety.

Logistics becomes the rising star in pharma as it impacts both drug integrity and revenue

Pharmaceutical product development is changing. The need to produce significantly higher potency large molecule biopharmaceutical drugs to improve efficacy and tailor drugs to the individual needs of a patient puts new pressure on transportation and shipping. Why? The reason is that these newer more complex protein based drugs are highly sensitive to temperature changes, and are often required to be shipped under strict temperature control of typically 2° to 8°C.

Recent research says that the global biopharmaceuticals market was worth US$ 136 billion in 2014 and is expected to experience a healthy growth rate in the future. In addition to higher potency, efficacy and more personalization, other key factors that will contribute to the growth of the biopharmaceuticals industry include higher approval success rates and significantly higher cost of therapy compared to traditional medications.

These biopharmaceuticals, being protein based, are highly sensitive to temperature changes, so any excursions in their ideal storage or transportation temperatures can disrupt their protein structure and make them ineffective.

Other key trends impacting the supply chain includes factors like the entry of biosimilars or generic versions of biological drugs which have already been launched in the US, Europe and other major healthcare markets; the increase in outsourcing trends of biopharmaceutical manufacturing to offshore locations; and biopharmaceutical manufacturing plants are now concentrated in a few regions, but their end-use markets diversified across the globe.

Trends point to more importance for logistics

All this amounts to placing logistics higher up in priority in the pharmaceutical business. The industry trends highlighted will create huge demand for efficient cold chain logistics services in the biopharmaceuticals industry, as well as for clinical trial materials and vaccines. Research from IMARC Group suggests that the global healthcare cold chain logistics services market will grow to almost US$13.4 billion by 2020, up from its current figure of US$8.5 billion.

With logistics becoming more important – and critical – in the supply chain, the cost of maintaining strict environmental and temperature conditions also becomes a larger element of the cost of the overall cost of supply a drug. In larger organizations, proper cold logistics might add between 30-50 percent additional cost, especially as a result of the new strict shipping conditions being required to address the new trends in drugs as mentioned above.

Hence logistics has become serious business for many pharmaceutical companies, and as a result, company boards have also responded, with logistics executives increasingly being elevated to board positions. One major Israeli pharmaceutical major has done just this.

Potential revenue loss if logistics are not in order

For people involved in logistics operations, this has become a welcome trend – especially since logistics executives have in recent times been struggling to get budgets approved as the cost of cold chain shipping and temperature control rises. In fact in many cases, the lack of proper cold chain monitoring can actually lead to loss of revenue – for example, there have been cases of countries banning companies from shipping their medicines if they are unable to prove that the temperature of the transported medicines has been properly maintained.

This is necessary because of new GDP (Good Distribution Practice) guidelines which are in fact now the law rather than just guidelines. Many board level executives are now beginning to recognize that if they don’t have their cold chain logistics and temperature monitoring in order, then there is potential loss of revenue, especially if an inspector somewhere in the process cannot see full evidence of product integrity.

So while in the past the need to prove a drug’s quality and integrity was often seen as an additional cost or overhead, this is now changing as drugs change. Pharmaceutical companies need to protect revenue, by ensuring that newer, higher cost and highly temperature sensitive drugs can be handled by their logistics in a safe environment and that they can provide proof that the products have travelled safely.

Making the business case for implementing serialization cost-effectively in the supply chain

As part of the implementation of serialization, automation of the process will become law within 10 years.  As already highlighted previously, serialization provides accountability and traceability of every item shipped in the supply chain.  The need to conform to these new requirements might at first glance look like it would require costly additional investment. But it need not be – and it might even be more cost-effective, once you take into account the additional benefits that could be obtained.

The ultimate goal is to provide complete traceability of a product to make companies accountable, and help ensure that medicines being delivered to the patient are safe to use. So the key is to collect information about products through the supply chain. For some companies, cold chain monitoring is already in place in some form, providing temperature data; so collection of additional data should be a simple incremental cost. For others, this may be a completely new area to address, and an investment in technology infrastructure might be required.

In both circumstances, the additional information provides much more value that just simply providing serialization data – and this is the key to a demonstrating that a strong return on investment is possible. The additional benefits might include, for example, stronger marketing value (to assure patients that products are safe), improved brand value, and also a more efficient network.

So what about the technology infrastructure requirement? Well, that is easy to address. The availability of ubiquitous mobile connectivity and cloud (internet) based data storage capability has made the task of collecting and storing information much easier than ever before. Many vendors now offer cold chain monitoring and track and trace facilities in what is called ‘software-as-a-service (SaaS), or the entire solution platform-as-a-service (PaaS).

So there’s no need to invest in technology infrastructure – as it’s already there, and all you have to do is subscribe to a service offering what you need, often on a monthly subscription basis based on various parameters – such as the number of points you need to measure.

The data gathered  gives companies insights into a lot more than just serialization information – it can provide complete logistics details through the whole journey of a particular product. Everything is recorded. This means that people running the logistics network can better understand their supply chain and this data might help them to make improvements and run more efficient supply chain networks. It can also help logistics managers use this data to manage shipping schedules and ultimately boost the bottom line.

To use an analogy, consider how web sites like Amazon now provide information to their customers: many now provide a complete track and trace facility for order shipments, so that customers can know at any time where their goods are located on their journey.

Now consider this same system implemented in a pharmaceutical temperature-controlled supply chain, with temperature sensors added to the network or along with the shipment.  It is possible to both pinpoint exactly where the shipment is at any time, and also overlay a temperature graph on top so that you get a complete picture of the shipment’s journey and the temperature history (see illustration).

If this is integrated into existing enterprise systems or workflows, the software technology solution can then provide insights into a complete transport fleet or network of warehouses.  And because the data is available live, alerts or warnings can also be sent by email or text to responsible persons that a digression or some other problem has occurred during the shipment’s journey.

From a serialization point of view, this addresses all necessary requirements:

• Product identification
• Product tracing
• Product verification
• Detection and response
• Notification

With details on where every box has been, the temperature, and other key parameters, this provides a complete story of the product shipment – and helps assure patients that products they receive are safe, and in the process helps add value to your brand and marketing. So when thinking about the justification for the cost of implementing serialization, it’s worth remembering the additional non-measurable benefits that can be achieved – and potentially also being able to improve your supply chain efficiency in the process.

Addressing the convergence of transport and logistics, and pharmaceutical compliance

This week, the largest transport and logistics conference for the Benelux countries, NT Dagen, will take place in Rotterdam on 10-11 June 2015.  One of the topics being discussed at this conference is pharma logistics, where the CEO of Dyzle, Rene Tjong Tjin Tai, will answer questions in a discussion forum to outline some of the industry challenges he has seen after working with many customers in pharmaceutical cold chain logistics.

He will address questions such as:

1. What are the key recent market developments in pharmaceutical logistics?
2. How can the transport and logistics sector maintain profitability while addressing new customer needs?
3. What kind of cost implications are there in meeting the needs of the pharmaceutical sector?
4. What are the things I need to put in place to serve the requirements of pharmaceutical customers?
5. Will I be able to handle this, from a compliance and GDP (Good Distribution Practice) perspective?
6. GDP: is it an opportunity or a threat?
7. What exactly is the new GDP all about, and what makes it different compared to the previous compliance requirements?
8. What’s the impact on my business if we want to work towards achieving GDP compliance?
9. How much additional cost is involved to add GDP compliance (note: you’ll be shocked!)?
10. Will I be able to succeed, given that logistics is cost driven, yet pharmaceutical logistics is quality driven?

These questions will be addressed in the forum, bearing in mind the convergence of logistics and pharmaceuticals, and the different business KPI’s (key performance indicators) that they come from.  If you’d like to learn more, make sure you attend the session on “Pharma Logistics, developments and compliance” starting at 13:30h on 11^th June 2015 at NT Dagen.

Why serialization is vital for pharmaceutical product integrity in the cold chain

More than ever before, drug security is an important issue in ensuring the integrity of medicines and vaccines reaching patients. The industry needs to demonstrate that we care for patients, and are putting all necessary measures in place to ensure that medicines are safe to be taken.

That means knowing the entire journey of a medicine through the supply chain, and having fully automated documentation about the conditions on its journey. One of the ways in which this can be addressed in the cold supply chain is through serialization. A key driver for implementing serialization will be global compliance requirements coming into play. The USA introduced the Drug Supply Chain Security Act at the end of 2013, which will require the availability of information at individual package level about where a drug has been in the supply chain.

What is serialization?

Serialization enables product authentication and product quality monitoring, by assigning a unique traceable number to each individual package or container.  This unique number, as it is tracked through the supply chain, allows key stakeholders do several things:

• enable verification of the legitimacy of the drug product identifier down to package level
• enhance detection and notification of illegitimate products in the drug supply chain
• facilitate more efficient recalls of drug products

Essentially this facilitates the prevention of and identification of counterfeit, diverted, sub-standard or adulterated drugs in the market, and provides accountability for the movement of drugs by participants in the supply chain.

Why it is needed

Serialization and security technologies are a vital part of addressing counterfeiting and theft of drugs – according to some estimates global drug counterfeiting is a $200 billion market.  Counterfeit drugs can result in financial loss, but for patients it could mean the difference between life and death, especially if the fake medicines are manufactured with sub-standard materials or have diluted dosages.

According to this article, ‘How technology can protect consumers and pharma companies from fake drugs’, Interpol estimates that 10 percent to 30 percent of all pharmaceutical drugs in circulation in the world are counterfeit and that up to one million people will die annually from counterfeit pharmaceuticals.

How serialization helps – providing absolute traceability

Serialization provides absolute traceability, sometimes down to individual packs; by providing this level of detail for the entire supply chain, it makes companies accountable, and enables them to act with confidence and speed should a recall be required. It also ensures that a pharmacy or distribution point can be identified and informed quickly and effectively if any problems occur, reducing the level of risk in the supply chain.

The USA introduced the Drug Supply Chain Security Act at the end of 2013, which by 2023 is expected to have in place, in different phases, the following requirements for drug traceability and accountability on the part of the supply chain involving manufacturers, wholesaler drug distributors, repackagers, and many dispensers (primarily pharmacies):

• Product identification: manufacturers and repackagers to put a unique product identifier on certain prescription drug packages, for example, using a bar code that can be easily read electronically.
• Product tracing: all stakeholders in the drug supply chain to provide information about a drug and who handled it each time it is sold in the US market.
• Product verification: all stakeholders to establish systems and processes to be able to verify the product identifier on certain prescription drug packages.
• Detection and response: all stakeholders to quarantine and promptly investigate a drug that has been identified as suspect, meaning that it may be counterfeit, unapproved, or potentially dangerous.
• Notification: all stakeholders to establish systems and processes to notify FDA and other stakeholders if an illegitimate drug is found.
• Wholesaler licensing: Wholesale drug distributors to report their licensing status and contact information to FDA. This information will then be made available in a public database.
• Third-party logistics provider licensing: Third-party logistic providers, those who provide storage and logistical operations related to drug distribution, to obtain a state or federal license.

Other countries are also in different phases of discussion about introduction of regulations requiring serialization, to ensure accountability and traceability – for example China, India, Mexico, Saudi Arabia, Brazil and Europe. This was discussed at the recent Pharmaceutical Traceability Forum, which looked at topics such as global compliance architecture, forthcoming regulatory deadlines, visibility between manufacturers, wholesalers and retailers, and the technology aspects – such as data standards and interoperability for product IDs.

From the technology platform perspective, Dyzle has for a while been providing a solution helping customers go some way towards tracking and documenting a drug product’s journey. Its real time monitoring solution transmits temperature and other critical cold chain data from a package or container to the web via mobile and wireless networks, and its traffic light system provides instant alerts of any digression.

From a serialization point of view, it also enables key stakeholders to get instant access at any time to the data via the web about the product and its journey, with its ability to identify the location as well as its temperature profile.

With the implementation of serialization, the process is also required to be automated within 10 years, and not paper based. Technology will be an important element in ensuring this automated assurance, providing the accountability and the traceability that various regulations around the world will require over coming years. Without proper integration, this could end up requiring significant investment.

In the next article, we will demonstrate how serialization can actually be implemented cost-effectively in the cold chain, so that full visibility of the entire journey of a product is available. As outlined in this article, it will help the industry demonstrate that we care for patients, and are putting all necessary measures in place to ensure that medicines are safe to be taken.

Top five trends move the cold chain industry to the next level: capacity, last mile, and security become important

by Rene Tjong Tjin Tai, CEO, Dyzle

There is now a good deal of awareness of the need for proper cold chain management in the storage and transportation of temperature-sensitive products in the pharmaceutical and food industry. In particular, there is now increasing pressure on manufacturers and logistics providers alike to ensure that regulatory requirements are met, and safety or integrity of products is not compromised – especially so when the lives of patients are at stake.

According to market research firm TechNavio, the global cold chain market is set to grow at a CAGR of 15.75 percent and 10.53 percent in terms of revenue and volume, respectively, over the period 2014-2019.  If defines ‘cold chain’ as supply chain management that involves storage and transportation of temperature-sensitive goods, using thermal and refrigerated packaging methods to help with the transportation and storage of those goods, and utilizing extensive logistics planning to ensure the integrity of these goods.

In order to demonstrate integrity and comply with GDP (Good Distribution Practice) guidelines, there are both monitoring and reporting requirements in the cold chain. This is provided by a variety of means – including data loggers, temperature monitors, sensors, track and trace systems and so on. Much of this reporting is provided on a historical basis (ie: at the end of a journey or on delivery), but there is also a growing trend for real time monitoring, providing alerts when a parameter such as temperature has digressed beyond a safe range.

Good Distribution Practice (GDP) and Good Automated Manufacturing Practice (GAMP) guidelines also require mandatory reports in a standard format to demonstrate compliance. Systems are now available that automatically create these reports from real time data sent to the cloud (see image).

So what is next for the cold chain industry in 2015? Here is what we consider the top five trends to watch out for this year.

• Creation of additional capacity and capability of handling for cold chain products; there is a shortage of both at warehouses as well as 3PLs (third party logistics providers)
• Proper last mile delivery and storage; this is still an issue in many emerging economies that don’t have proper end to end cold chain infrastructure, and this also needs to include return of products.
• In air / at sea temperature monitoring; temperatures can already be monitored in the air but cannot currently be transmitted in real time as the wireless radio connection has to be switched off in air.
• GDP ‘like’ inspections by the regulators in the last-mile – for example, at pharmacies.
• Maximizing the benefits of investments in serialization, security, GS1 and temperature monitoring by integrating solutions

The last point on this list of trends to watch out for in this year, serialization, is an important one in the battle against counterfeit drugs, and ensuring supply chain security. Legislation will come on board in a number of countries, forcing multinational companies to look at effective ways of coding individual products around the world, and enabling individual item level serialization. The ability to track and record each item’s movement across borders will mean pharmaceutical companies face new challenges and requirements, and have to implement serialization standards.

In summary, we are coming to a new phase in the cold chain industry, where issues like capacity, last mile delivery, and product security become as important as the capabilities that we are currently seeing to monitor the cold chain.

As cold chain logistics demands grow, technology becomes critical

Increased demand for generic pharmaceutical products and consumption of perishable foods in developing economies is going to drive significant growth in the cold chain logistics market in the next few years.  With this demand for better visibility of products in the logistics networks, to minimize wastage, and to ensure product integrity, technology that enables better monitoring and analytics in real time will play a major part in many cold chain logistics networks.

It is not just developing markets that are seeing growth in the cold chain.  North America is the largest market for the cold chain, according to Persistence Market Research. It says that increasing demand of daily products, vegetables and fruits, along with more exports of these products has boosted the cold chain market.

In the Asia-Pacific region, various government initiatives are also impacting the market – for example, the Indian government is opening mega food parks, which require temperature controlled vehicles and temperature-controlled warehouses. There, the government has also allowed 100 percent FDI (foreign direct investment) in the cold chain industry. The report also says that in Europe, Germany is one of the largest markets due to the increased consumption of frozen foods.

In terms of potential size in relation to the refrigerated storage and refrigerated transport part of the global cold chain market, it is expected to reach a value of US$ 233,476.7 million by 2019, at a CAGR of 15.6 percent from 2014 to 2019, according to Research and Markets. It also suggests that North America accounted for the largest share – 40 percent – of the cold chain market in 2013. The market is mature in regions such as North America and Europe due to the technologically advanced systems for refrigerated storage & refrigerated transport, the rise in demand for perishable foods, and government initiatives that encourage the export and import of these foods in these regions.

Healthcare logistics cold chain requirement grows too

Healthcare products such as vaccines and blood plasma products, frozen pharmaceuticals and insulin require specific temperatures to be maintained throughout storage and transportation.  The increased demand in developing economies for these and other pharmaceutical products has created a pressing need for temperature-sensitive healthcare transportation with the use of temperature tags on products.

Recognizing this, research firm TechNavio, says that the global healthcare cold chain logistics market is expected to grow at a CAGR of 13.31 percent from 2014-2019. In its report, it says increased investment in cost-effective technologies in developing markets, especially India, is motivating vendors to enter this region.

Technology becomes critical in enhancing and assuring product integrity

In order to meet these requirements, both in food and pharmaceuticals, there’s growing investment in healthcare infrastructure and technologies.  In the cold chain in particular, there is an emergence of transport vehicles equipped with event logging and electronic monitoring systems, to enhance the effectiveness of supply chain.

In fact, this will be a key area of discussion at the forthcoming Cool Chain & Controlled Room Temperature Logistics Conference in Frankfurt, Germany on 26-29 January 2015. Among the discussions planned for supply chain integrity, there will be a look at how temperature data can be used to improve and better control the cold chain.

It will also look at what to do with the data – how implementing a centralized global database can enable an overview of all excursions and provide complete insight into the cold chain, and overcoming fears of using ‘cloud’ storage.

This will be important as big data analytics becomes an integral part of many business processes in the coming years. The growing use of machine to machine (M2M) communications, which allows sensors to send real-time data via mobile and wireless communications networks, will generate lots of data – this data might be continuous readings of temperature or other key business critical parameters that need to be monitored.

Systems like Dyzle’s cold chain monitoring platform send the huge volumes of data generated by these sensors to secure storage in the cloud, which makes it accessible for real-time monitoring and for reporting. This data is often used both for historic recording processes, as well as to produce automated reports to demonstrate GDP compliance for example; in addition, it also helps to assure customers and consumers that the products are safe to use.

Wireless sensors like those shown here send data from temperature measurements to secure storage the cloud, making the information accessible for real-time monitoring and reporting

Technology such as this will therefore become critical in reporting key business performance indicators (KPIs), and will become an integral part of the logistics as well as business management process.

This will be especially significant as the volume of temperature-sensitive products that are shipped around the world grows; hence the demand for proper cold chain logistics with the ability to prove integrity with will become more important, since pharmaceutical companies will need the proof to be able to sell their products. The only way this can be solved is to have sensors and be able to make measurements, to handle lots of data, and to be able to record and interpret that data according to the market requirements.