Your patients never worry that your hospital or health system pharmacy will have the drugs they need in stock and available when they need them. The foundation of that assumption is efficient and effective transportation and delivery in your drug supply chain.

What does it take to build that foundation? Why is it critical to the care that your pharmacy provides to your patients? McKesson’s Brian Casselman, vice president of transportation, explains in this edition of Ask a Supply Chain Expert.

What are you responsible for in your role at McKesson?

Casselman: I’m responsible for driving our strategy of how we get products from manufacturers to our distribution centers and then to your hospital or health system pharmacy. My specialty and my part of our drug distribution process is transportation. That’s the physical part of delivering what you need to your loading dock or your door.

How do you interact with hospital and health system pharmacies in the course of your work?

Casselman: I work with our operations team to understand the unique delivery needs of your pharmacy. As you know, health systems are getting so complex and large today. Each one has its own delivery needs. It’s not like 10 years ago when most health systems were much simpler and smaller. We could standardize things for our local delivery partners. Now we have to work a lot harder to understand how each health system runs and to be able to translate that into something that a driver on the ground can understand and execute.

What’s happening at health systems to make drug distribution more complex?

Casselman: If your hospital pharmacy is like most, your health system is adding all kinds of ancillary sites like outpatient pharmacies, urgent-care centers, ambulatory surgery centers or physician practices. Your health system is spreading these sites across wider and more diverse locations. They’re not all on a central campus. And what we’re delivering in terms of drugs and supplies is more diverse. Now, drivers don’t know what’s in the totes for security purposes. But we know. And it’s our job to make sure that all these different products get to the right locations on time so you can deliver the best possible care to your patients. 

What common operational challenges are hospital pharmacies facing in their supply chains?

Casselman: The biggest operational challenge is efficiency. As your health system grows, you have more and more pharmacy locations and more sites of care that dispense drugs. How do you get the drugs and supplies you need from one place to another from a transportation standpoint? That’s a real challenge. Not just how you do it but how you can do that efficiently. With all the cost pressure everyone’s under, you can’t just throw money at it. You have to be more strategic.

How do you work with hospital pharmacies to solve that drug distribution challenge?

Casselman: It’s a combination of things. It starts with scheduling technology. In theory, we know what we’re supposed to deliver where and when, and we map out the most efficient route. But then you give us input to see if that theory matches the reality of your situation in terms of sites, traffic patterns, staff and other factors. Then we lock into a routing pattern that we repeat over and over again. We get better at it through repetition and by building a relationship with you. We also track our packages through bar code technology at every step in the delivery process. So we’re constantly monitoring our transportation performance and looking for ways to improve. All of that is what drives more efficiency.

You’ve mentioned loading docks and staff. How do those affect transportation and efficiency?

Casselman: They’re little things that most people don’t think about. But they can have a big impact on how you move things from one place to another. For example, if you’re a pharmacy inside a big hospital, you have lots of trucks and drivers jockeying for dock space to make their deliveries. Rather than waiting for space, you should have a plan to unload in another location like a parking lot and cart things inside. As for staff, some of your smaller delivery sites aren’t open at the same time or the same hours as your bigger delivery sites. You need to time your deliveries in the right order or else you’ll be running back and forth to different sites as they open and close at different times.

What’s the connection between transportation efficiency in the drug supply chain and patient care?

Casselman: There are a few. More of what we’re delivering to your hospital pharmacy are what I call high-value specialty drugs. Not only are they high value in terms of cost, but they’re high value in terms of clinical importance to patients. A lot of these are sensitive and need special handling and shipping or may have a short shelf life. Getting these drugs to you to dispense or administer to patients in the right condition at the right time is critical. Another connection is simply time-sensitivity. To keep their inventory costs down, hospital pharmacies like yours are not keeping much stock on site. Instead, you’re having someone like us deliver what you need the day before or the morning of. You’ve scheduled drug treatments or surgical procedures that day that are dependent on us delivering what you need on time.

How do transportation efficiency and on-time deliveries affect hospital pharmacies financially?

Casselman: Again, it gets back to cost. If you build your staffing models around when you expect us or someone else to deliver your products and they don’t come, you’re paying people to stand around and do nothing. And that’s nothing compared with the cost of treatment rooms or operating suites that go unused because you had to delay or postpone patient care.

What supply chain trends should hospital pharmacies stay on top of and why?

Casselman: A big one is the supply of drivers—the people who drive the trucks that deliver the drugs to your pharmacy. There’s a growing shortage of drivers for a few reasons. The younger generation doesn’t want to be drivers. Car service and ride share companies are soaking up available drivers. And online retailers that promise same- or next-day deliveries are soaking up available drivers. There are only two ways for you to deal with it. Either pay a lot more or come up with a different way to get your deliveries.

Which do you recommend that hospital pharmacies do?

Casselman: In the short term, you may have to pay more. But I think the long-term solution is coming up with new ways to get your products. That could be reducing the number of delivery points in your health system and then having an internal system of moving products from those points to individual care sites. It could be making the size of each delivery larger. It could be partnering with other delivery services.

What about drones and driverless cars?

Casselman: I think those are possibilities in the future. But we’re not there yet. Plus, you’ll still have the issue of who takes the package from the drone or driverless car and brings it inside to your pharmacy. You’ll still need a real person on your end to replace the delivery person.

What do you like most about working with hospital pharmacies on their supply chain issues?

Casselman: I like solving puzzles, and health systems are big puzzles. And each one is a different puzzle. I love the challenge of coming up with creative ways to transport and deliver what each of these systems needs to provide the best possible care to their patients.

Editor’s note: Have a question for one of our supply chain experts? Please leave a comment below and let us know what you’d like to see covered in a future edition of Ask a Supply Chain Expert.

Related: Learn more about McKesson’s drug distribution services for hospital and health system pharmacies

McKesson

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McKesson editorial staff is committed to sharing innovative approaches and insights so our customers can get the most out of their business solutions and identify areas for operational improvement and revenue growth.

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