Specialty drug distributors “save billions” in healthcare costs

Arlington, VA, US: Distributors of specialty pharmaceuticals for patients suffering from cancers and other serious illnesses save the healthcare industry “billions of dollars a year”, mainly as a result of their skills in high-tech, cold-chain and just-in-time delivery systems.

That is the conclusion of a new research report by the Center for Healthcare Supply Chain Research, the research foundation of the Healthcare Distribution Management Association (HDMA).

Companies that distribute only specialty drugs save the industry an estimated $3.5bn (£2.1bn), based on an analysis of the value of their services and of the increased cost if manufacturers and healthcare providers assumed their role. The savings amount to about $8bn (£4.9bn) when this analysis is expanded to include traditional distributors that handle specialty drugs.

“This research spotlights the vast and indispensable services that specialty pharmaceutical distributors deliver in the fastest-growing sector of the pharmaceutical industry,” said Karen J Ribler, chief operating officer of the Center for Healthcare Supply Chain Research. “They provide lifesaving medicines to many of society’s most vulnerable patients, and they do it with exceptional skill and quality that lowers the cost of healthcare.”

Biological and other specialty drugs present formidable distribution challenges, because extreme heat, humidity and light, excessive shaking and vibration and even pH changes can compromise their effectiveness, says the report.

The report indicates that distributors preserve these medicines in storage and transit through a variety of specialized measures and techniques. Such measures are growing even more important given estimates that seven of the top 10 pharmaceutical products will require cold chain distribution by 2014, according to the report. The study also notes that specialty distributors use technologies to manage inventories, transactions and deliveries with speed and precision. These include customer relationship and warehouse management systems and electronic data interchange (EDI) communications to process purchases, shipping notices, invoices and payments.

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