Rx-360 Supply Chain Security: Audits and Assessments of Third-Party Warehousing and Distribution Facilities Version 2.0

Pharmaceutical manufacturers and distributors frequently outsource various business functions to organizations that have a specialized expertise. While outsourcing can offer improved efficiency and cost savings, it also creates certain risks to product safety and security while in the hands of 3rd parties be it storage or logistics providers. Without enough transparency primary risks to products are counterfeiting, diversion, theft and adulteration. While all these risks exist in both proprietary and outsourced facilities, theft and diversion of drug product at and through third party Logistics Service Providers (LSP) are significant risks. LSPs provide a client company with warehousing, distribution and logistics services. This business risk further increases as the industry moves into emerging markets where supply chain visibility is poor, security knowledge and standards are lower, and the risk of criminal activity is higher. The primary defense against these risks is an appropriate security program with expectations and responsibilities conveyed through contracts and confirmed via assessments and audits.

The focus of this white paper is to assist manufacturing clients by providing a framework from which they can select the elements and aspects that are best matched to their risk tolerance and apply it via the system outlined in this document or via their own customized version of the system to maximize the protection of their patients, their brand, and their organization. The paper will outline the elements of an effective Security Plan. These elements are intended to work together as a system.