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demand planning, forecasting, and exception management

Pharmaceuticals

The pharmaceutical value chain is dependent on two major demand forecasts:

  1. Very long-term forecast for new pharma launches and supply chain readiness. This includes making accurate market potential and launch forecasts which drives the capacity building so that it is ready for FDA approval and c-GMP compliance.
  2. Short to medium term replenishment forecasts that are based truly on demand plans. This is for established products but still driven by patient demand.

Just as the consumer drives the demand in any value chain, here the patient drives the ultimate demand. The patients can influence the providers to write a particular choice of a branded prescription based on their knowledge or based on the education from major marketing campaigns.

demand flow for pharmaceuticals

The patient and the provider jointly create the demand signal for the pharmacies to fill. So the prescriptions filled by the pharmacies act as the ultimate driver of the pharma demand. These could be some what influenced by marketing activities.

Demand lumpiness may occur due to pricing promotions and stocking by pharmaceutical wholesalers. Outside the US, this can also be caused major Government purchasers doing a contract buy.

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