Devising an International Clinical Trial Distribution Strategy: Genentech's Approach - A decision-criteria matrix and cost models helped pinpoint the best distribution approach for the short- and long

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Devising an International Clinical Trial Distribution Strategy: Genentech's Approach
A decision-criteria matrix and cost models helped pinpoint the best distribution approach for the short- and long-term.


BioPharm International Supplements


Outsourcing and Building in the Asia-Pacific Region

From a TCO standpoint, the outsourcing model is an attractive strategy for the long term given Genentech's forecast ex-US clinical trial (shipment) volumes. Qualitatively, long-term outsourcing has benefits similar to those for short-term outsourcing. Based on the decision-criteria matrix, the outsourcing model does not enable the company to build international distribution know-how as specified in the strategy criterion, nor does it deliver the control described in the regulatory and quality criterion. The build model, however, is an ideal way to satisfy these two criteria. Genentech will consider the option to build and direct ship where possible in Asia, because this model's TCO for Asia is comparable to the TCO of outsourcing in Asia. The hybrid approach satisfies all the criteria that Genentech feels are important in developing an international clinical trial distribution strategy.


Figure 3. A long-term hybrid model for regional and local distribution, combining the outsource, build, and direct ship models.
To implement the build aspect of the long-term strategy in Asia, the company will consider building a regional depot in Singapore because this would be co-located with its commercial distribution center, allowing Genetech to leverage resources (thus reducing costs) with regional logistics and distribution knowledge. The company will continue to outsource the country-depot function until sufficient clinical trial volumes financially justify building Genentech's own country depots. Figure 3 depicts a long-term hybrid combining the outsource, build, and direct ship models.

Next Steps

Genentech will periodically reevaluate its assumptions to ensure that the assumptions driving the strategic decision have not substantially changed. The project team has built a business process and set volume trigger points by which the strategy being followed will be reevaluated. Genentech's clinical trial distribution strategy is set up to leverage increased knowledge of the following: global medical markets, global manufacturing and distribution networks, and significant expertise in working with outside contractors and partners. This leveraging will ensure that Genentech continues to focus on innovative medicines to solve difficult and serious health conditions.

Acknowledgements

The authors wish to thank Franco Pasquale, Joy Guidi, Ed Cox, Melody Spradlin, Frank Hathaway, Lisa Arjes, Robert Larson, Susanne Somerville, Michelle Polowski, Colleen Griffith, and Aslam Galia.

Joe Jovero is a global supply chain senior manager and Sue Steven, PhD, is a senior director, process research and development, both at Genentech, Inc., South San Francisco, CA, 650.467.9816,


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