Are You Considering Serialization Processes When Choosing Your CDMO Or 3PL?
By Lance Parker, Robin Dolan, and Dave Treadaway, Clarkston Consulting
As a biopharmaceutical organization preparing for commercialization, one of the most important decisions is who you choose as your trading partners. While factors such as service levels, cost, quality, and capacity are typically considered, an important element that can be overlooked is serialization and DSCSA (Drug Supply Chain Security Act) compliance. For serialization, two types of trading partners are the most critical, the contract manufacturer/packager organization (CMO/CPO) and the third party logistics provider (3PL). Ensuring these partners have the skills and experience to meet serialization requirements is critical for efficient market entry and ongoing regulatory compliance. One way to ensure this is to include serialization in your selection process. Here are some tips on how to do that.
Gathering Your Requirements
Starting at the beginning, when laying out the requirements for potential trading partners, it is crucial to consider serialization and the best way to do that is to include serialization experts in the conversation. Serialization experts bring a wealth of knowledge and specialized skills including expertise in DSCSA compliance, supply chain management expertise to ensure each drug’s chain of custody is documented, and knowledge for guiding data creation, aggregation, and transmission of serialized data. With DSCSA compliance at the forefront, clearly define what your organization will need from a CMO and/or 3PL. This sets organizational expectations from the start and can help ensure that serialization requirements are not left out. When creating these requirements, do not limit yourself to the organization’s current product and market; consider future market regulatory requirements, future product mix, and additional points of distribution or manufacturing.
Identifying which of the elements are must-haves versus nice-to-haves is also key to choosing the correct trading partner. A partner’s ability to support serialization efforts needs to be considered a must-have for regulatory compliance; however, some specific elements of how serialization is managed can be preferences. Organizations should seek to assess the vendor’s familiarity with the DSCSA requirements, as this is fundamental. Consider evaluating potential partners’ records in implementing serialization for similar clients. Again, consider the future and evaluate against their ability to adapt to evolving serialization standards (i.e., print capability of 2D data matrix, GS1-128, QR codes, etc.) This means considering what markets they can currently support and what plans they have for growth. For example, if there are plans to expand into the EU, then country-specific requirements (i.e., printing special characters or other languages) must also be considered during evaluation.
Constructing Your RFI/RFP
Likely to be the first contact with a potential partner, the request for information (RFI) or request for proposal (RFP) should set the tone, indicating that serialization will be considered in the selection. Like during the requirements gathering, a serialization expert should be involved in authoring the RFP.
The RFP should include specific serialization-related questions. Consider questions about the vendor's serialization procedures, their L4 system, and how they manage serialization data exchange and integration. To ensure a good fit, ask about their organizational structure as it relates to serialization. Will you have access to the program leader? Is there a serialization-support team? Also, add questions to gauge what sort of experience the vendor has supporting serialization in your current market as well as potential future target markets.
Evaluating Your Final Partnering Options
As you narrow in on partner options, a site visit and demonstration of their capabilities will likely be next on your plan. To ensure the correct questions and concerns are raised, ensure a serialization expert is included in the visits. Be sure to observe their serialization processes in action, including serial number requesting and label printing for CMO/CPOs and intake of serialized product, decommissioning, and picking/packing of serialized product for 3PLs. Specifically cover how the vendor handles exceptions as they relate to serialization; for example, does the vendor have a well-established procedure for handling returns? Consider the experience and structure of their serialization team and practice overall as you move forward.
Be sure that your serialization experts review final proposals and that they provide input and guidance in the final trading partner decision. There are a few elements that should be top of mind: Consider the vendors’ response times and ability to answer questions. Serialization issues can halt material movement, so understanding your access to their serialization team will be critical. Do they understand the requirements of DSCSA and are they able to support them? Look at the vendor’s ability to integrate with your L4 system as this will help with a smooth onboarding process. Finally, consider the scalability and flexibility of the vendor’s serialization solution to ensure they will be a good partner even as your organization grows.
Conclusion
By thoroughly considering serialization capabilities when selecting trading partners, companies can avoid costly delays, compliance issues, and operational disruptions. Serialization is a critical component of a company’s supply chain security through counterfeit prevention, supply chain visibility, and enabling item-level traceability. While the focus in selecting your trading partners will likely be their manufacturing and distribution capabilities, serialization must also be a focus.
About The Authors:
Lance Parker is a supply chain executive at Clarkston Consulting with extensive experience identifying high-impact growth opportunities and leading complex organizational change. He implements strategies that boost profitability and operational efficiency, including managing multi-functional teams and developing personnel capabilities to drive business transformation and support long-term growth. His deep expertise includes supply chain management, inventory optimization, logistics, manufacturing, distribution, procurement, and project management. His credentials include an MBA from the University of Tennessee. He is also a Certified in Production and Inventory Management (CPIM) professional and a Six Sigma Black Belt.
Robin Dolan is a manager at Clarkston, where she leads supply chain services across various industries, including life sciences. With a diverse background in demand and supply planning, inventory management, sales and operations planning, sourcing, logistics, distribution, and supply chain analytics, Dolan has designed and led supply chain organizations. She has supported vendor selections for technology and supply chain services, as well as led software and service implementations. Her expertise also extends to strategic roadmaps and organizational design initiatives. Dolan’s approach blends technology with operational excellence.
Dave Treadaway is a partner for Clarkston Consulting helping clients address their business challenges through business transformations of their processes, organization, and systems. His experience spans over 25 years, with both industry and consulting experience. He has deep experience with large SAP ERP implementations, pharmaceutical serialization, WMS systems, and transportation in both manufacturing and wholesale distribution. His leadership includes the following focus areas: supply chain, distribution, logistics, order-to-cash, manufacturing, contract manufacturing, warehousing, transportation, pharmaceutical/life sciences serialization and traceability, system integration, ERP, business process, training, change management, and program management.