Managing logistics risks in pharmaceutical supply chain: a 4PL perspective

Abstract

Supply chain risks and vulnerabilities have been growing recently due to the global, interconnected, and complex networks. The Pharmaceutical Supply Chain (PSC), as a critical national asset, requires increased attention to mitigate the severe consequences of global events. With various risks impacting both the firm’s performance and the lives of patients, effective risk management is paramount for the PSC. This empirical study focuses on the UK-based Fourth-Party Logistics (4PL) provider, which manages pharmaceutical manufacturers’ logistics operations. The 4PL provider’s past experiences with unexpected risky events have influenced its performance. This study aims to explore inherent logistics risks, evaluate them, and recommend mitigation strategies. An integrated approach considering probability, impact and manageability parameters is proposed for risk assessment. In identifying 11 risks from the 4PL perspective, structured interviews are used to gather risk information. The probability of risk occurrence, severity of impact, and manageability are quantified. The delivery delay should be given priority in the follow-up risk management process, while counterfeiting has the least priority. Finally, three resilience strategies named improving flexibility, redundancy, and creating a risk culture are proposed for the 4PL case company. The study offers multiple theoretical and managerial implications based on its findings.

Keywords:

• Pharmaceutical supply chain
• risk management
• resilience
• the 4PL provider
• healthcare industry

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

D. G. Mogale

Dr D. G. Mogale is a Senior Lecturer at Cardiff Business School, holding a PhD in Industrial and Systems Engineering from IIT Kharagpur and a Post-Doctoral from Cranfield School of Management, UK. Additionally, he is an FHEA Fellow and an active member of the CILT's Logistics Research Network (LRN) forum. Dr Mogale is passionate about Supply Chain and Logistics Modeling, with research interests spanning Risk and Resilience as well as Sustainability. He has published numerous articles in leading operations, logistics and supply chain management journals.

Dongxiao Xian

Ms Dongxiao Xian earned both her Bachelor’s and Master’s degrees in Logistics & Operation Management, graduating with distinction. Her academic work emphasized logistics optimization, risk management, and strategic supply chain management. As a highly skilled Supply Chain Planner, she has over 6 years of experience spanning various projects from upstream to downstream in the supply chain, including managing purchasing, warehouse operations, and overseas logistics for both domestic and international projects. This hands-on experience underpins her dedication and commitment to enhancing performance in supply chain activities.

Vasco Sanchez Rodrigues

Dr Vasco Sanchez Rodrigues is a Full Professor of Sustainable Supply Chain Management at Cardiff University. His research focuses on challenging areas affecting society and industry such as NetZero, water resource management, land use and food waste prevention and mitigation. Vasco is an industry-led academic who has undertaken successful applied-research projects that brought substantial benefits to leading companies from the retail, food and drinks, and logistics sectors of the UK, France, the US, Germany, South Africa, South Korea, Colombia, Peru, Chile, and Argentina. Furthermore, he has published over 50 papers in prime international academic journals and is leading several applied research projects that together have £4 million of external funding. Prior to joining UK academia, Vasco spent six years working in Venezuela, Mexico, Colombia, and Brazil managing manufacturing operations and project improvement implementations in BIMBO Organization, the second biggest bakery multinational worldwide, holding a range of supply chain-based management roles. Vasco is also the Chair of the CILT-sponsored Logistics Research Network Forum, acts as external examiners for higher education programs of several UK universities, program director of MSc Sustainable Supply Chain Management at Cardiff University, leader of executive and professional training courses for organizations such as Ocado, Universidad del Desarrollo (Chile) and Universidad del Pacifico (Peru), among others.