Abstract
BackgroundIn pharmaceutical enterprises, keeping up with global market conditions is possible with properly selected supply chain management policies. Generally; demand-driven classical supply chain model is used in the pharmaceutical industry. In this study, a new mathematical model is developed to solve an inventory problem in the pharmaceutical supply chain.MethodUnlike the studies in literature, the “shelf life and product transition times” constraints are considered, simultaneously, first time in the pharmaceutical production inventory problem. The problem is formulated as a mixed-integer linear programming (MILP) model with a hybrid time representation. The objective is to maximize total net profit. Effectiveness of the proposed model is illustrated considering a classical and a vendor managed inventory (VMI) supply chain on an experimental study.ResultsTo show the effectiveness of the model, an experimental study is performed; which contains 2 different supply chain policy (Classical and VMI), 24 and 30 months planning horizon, 10 and 15 different cephalosporin products. Finally the mathematical model is compared to another model in literature and the results show that proposed model is superior.ConclusionThis study suggest a novel approach for solving pharmaceutical inventory problem. The developed model is maximizing total net profit while determining optimal production plan under shelf life and product transition constraints in the pharmaceutical industry. And we believe that the proposed model is much more closed to real life unlike the other studies in literature.
Highlights
In pharmaceutical enterprises, keeping up with global market conditions is possible with properly selected supply chain management policies
The proposed mixed-integer linear programming (MILP) model contains “shelf life and product transition times” constraints together and we believe that the proposed model has much more real life constraints unlike the other studies in literature
The results illustrated that the vendor managed inventory (VMI) provided much better results in terms of total supply chain costs
Summary
In pharmaceutical enterprises, keeping up with global market conditions is possible with properly selected supply chain management policies. A new mathematical model is developed to solve an inventory problem in the pharmaceutical supply chain. Pharmaceutical industry applies a supply chain policy that allows the continuation of a wide variety of materials with large quantities in a very fast flow. The product variety is a huge problem to manage within short time windows. The production of pharmaceutical products has two stages as primary and secondary level. Primary production includes the production of basic molecules active components or pharmaceutical active ingredients. The secondary production includes the processes of being formulated of these active components and the delivery to Candan and Yazgan DARU Journal of Pharmaceutical Sciences (2016) 24:4 product is on production line and the expiry date starts from the date of production
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