Anti-Counterfeit Technology in the Pharma Supply Chain

Organizational Background

Cure Pharmaceutical (Cure) operates in the pharmaceutical industry's drug delivery technology segment. Cure is considered a small pharmaceutical company with revenues of approximately $150 million. A technology designed by the firm enables patients to take medications without water. This patented Oral Thin Film (OTF) Technology is small, light, and occupies much less space after packaging. The technology can be shipped in single-dose form or in bulk rolls to the site of patient care. Cure's core business integrates generic drugs — effective treatments for a multitude of diseases — into its proprietary OTF technology.

Since Cure has a unique delivery system, it distributes OTF both in bulk form and in individual dosing units utilizing authorized and private brokers. Because of this model, the implementation of anti-counterfeit technology presents a major challenge. Since some product is cut into dose form from bulk rolls at the site of patient care, simple tracking devices inserted into packaging may not suffice. Furthermore, Cure is a small company with limited redundancy in its manufacturing process; thus, finding a solution for preventing counterfeit drugs without disrupting operations — so that the company can continue to supply medicines to those in need — is crucial. It is also important to adopt a strategy that aligns with Cure's mission of keeping medicines affordable for everyone. Counterfeit drugs have a tremendous impact on not only business sustainability, but also social sustainability.

As Cure continues to grow in emerging markets, the threat of counterfeit infiltration of its brand and value chain increases. To grow in these markets, the company must rely on independent brokers and secondary wholesalers, often controlled by small private entities with limited security and control over their distribution chains. This increases the organization's vulnerability to counterfeit risk. Since entering emerging markets, Cure has observed a five percent increase in counterfeit products infiltrating its distribution channels over an eighteen-month period. Despite this risk, emerging markets offer strong growth potential and are critical to Cure's overall mission of distributing affordable essential medicines to populations in need.

This report provides a strategic action plan for integrating anti-counterfeit technology into the firm's supply chain. Particular attention is paid to strategic aims and objectives, levers and obstacles, implementation costs, mechanisms for tracking progress, and risks and barriers.

Strategic Aims and Objectives

To address the risk of counterfeits as it expands operations in emerging markets, Cure will implement a blended anti-counterfeit technology consisting of RFID tagging and barcode printing directly on the OTF itself. The RFID technology will be utilized in both bulk packaging and single-dose units. The firm will also develop an app that allows stakeholders to quickly identify products via smartphone scan. The overall goal is to eliminate counterfeits from the firm's supply chain — especially with regard to its OTF technology — while simultaneously advancing market penetration, promoting patient safety, and ensuring seamless integration.

The implementation of the technology will specifically seek to achieve two objectives:

i. To reduce the incidence of counterfeits by 20% by June 2018

ii. To increase product distribution and revenues by 20% by June 2018

The achievement of these objectives will be crucial for building Cure's reputation for delivering authentic, safe drugs to its markets and will serve as an important source of competitive advantage in the highly competitive pharmaceutical industry.