European Healthcare market changes addressed by DHL White Paper

DHL have commissioned a new white paper that examines how changes in the European healthcare market are impacting supply chain models.

The report, ‘Adding value and reducing costs: Transforming the European medical device supply chain,’ explains what modifications medical device supply chains must undergo in order to survive in today’s healthcare environment.

Changes to the European medical device industry are shifting the business paradigm. Value-based healthcare, cost and margin pressures, and increasing regulatory and compliance requirements characterize modern European healthcare operations. These dynamics are forcing manufacturers to reevaluate their supply chain operations to remain competitive, and continue supporting healthcare providers by putting their patients first.

Susanne Amholt, DHL supply chain’s vice president for business development, life sciences and healthcare, Europe, said: “The pressures facing the European medical device industry are not new: what’s changing is their intensity and momentum. We understand the regulatory and quality assurance environment which is rapidly adding new layers of complexity and cost to the medical device supply chain at a time when pressure to cut costs - from governments, payers, healthcare providers and patients - has never been greater. Meanwhile, there are significant differences in markets and operations.

“Illness patterns in the emerging Eastern European markets are starting to match those in the mature Western European countries, but product preferences, payer mechanisms, regulations and distribution channels continue to differ widely by country. These practices vary country-by-country, making Europe a very complex market to serve.”

The white paper discusses: the current state of the market; how trends impact the European medical device supply chain; and what new supply chain strategies, practices and solutions are available to address these developments. Outlined in the white paper are four important strategies that medical device and life science companies can implement to address these changes.

The four strategies focus on, segmenting supply chains by product value, creating a direct to customer channel, leveraging shard-use distribution centres, and outsourcing logistics to a third party.

The ‘Adding value and reducing costs’ white paper was prepared by Lisa Harrington, president of the lharrington group LLC, who said: “The time has come to re-think the European medical device operating model in general and the supply chain in particular. Leading manufacturers are doing just that. They are working with their logistics service providers to reengineer their supply chains to embrace outsourcing solutions, shared services and other supply chain solutions. Meeting the twin challenges of reducing costs and delivering on service commitments is not an easy task. However, with the right partnerships, it can be done in a manner where everyone wins, including the ultimate customer – the patient.”