As Supply Chains Grow, So Do Companies’ Worries About Reform, Regulation, and IP Protection

Moving medical products around the world is no easy task, so it’s not surprising that healthcare supply chain professionals have a number of concerns keeping them up at night. Chief among them are healthcare reform and legislation, regulations, and intellectual property protection.

Jamie Hartford 1

August 30, 2011

1 Min Read
As Supply Chains Grow, So Do Companies’ Worries About Reform, Regulation, and IP Protection

A recent survey by freight company UPS asked senior-level decision makers at pharmaceutical, biotech, and medical device companies to identify their top business concerns. In the United States, the No. 1 answer was healthcare reform. Sixty percent admitted it’s a worry, up 5% over 2010. Moreover, anxiety about the issue isn’t likely to abate soon.

“Although the legislation was passed last year, it’s now going through the regulatory bodies, which are determining how those regulations will be implemented and measured and managed,” says John Menna, director of healthcare logistics strategy for UPS. “As more details become known, I expect this number might increase over the next couple of years.”

Another issue respondents said will impact their business—and of special concern to device makers—is intellectual property protection. More than 80% of respondents worldwide said they plan to enter new markets around the world in the next three to five years, and 70% have done so in the past year-and-a-half. As supply chains stretch to accommodate companies’ larger footprints, protecting ideas gets more complicated.

“Every time there’s a handoff, there’s potential for damage, potential for loss or spoilage or theft of product, with intellectual property being a concern,” Menna says.

IP protection was a significant issue in all three regions (the United States, Europe, and Asia) covered by the survey, but respondents in Asia are particularly worried about keeping their ideas under wraps. Half of respondents in that part of the world cited IP protection as a concern, versus 40% in the United States and 34% in Europe. Overall, about a third of respondents identified IP protection as a barrier to global expansion.

—Jamie Hartford

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