To: flatsville who wrote (5266 ) 4/5/1999 11:05:00 AM From: C.K. Houston Read Replies (2) | Respond to of 9818
Stop Stockpiling! DRUGTOPICS - Feb 15 '99drugtopics.com Consumer concerns and overreactions may pose the biggest Y2K threat to pharmacies and suppliers. . . . Each link of the pharmaceutical supply chain is prepared for the much publicized--but still undetermined--computer glitches that could arise on Jan. 1, 2000, according to an array of speakers at the Y2K Supply Chain Conference held late last month in Newark, N.J. The question is: Is the industry prepared for how consumers might prepare themselves? Representatives from wholesalers, manufacturers, and the chain drug industry all reported that their respective organizations have made plans to deal with potential problems--internally. With equal unanimity, however, they also agree they will not be able to keep up with demand if patients start hoarding prescription products as 1999 wears on. "While we're prepared for some increase, a total panic buy would probably result in exactly what we're all afraid of--that patients will not be able to get medicines when they go to get their prescriptions filled," admitted Anne Faul, director of trade relations for manufacturer Glaxo Wellcome. And the implications of such a scenario, she said, would have a dramatic ripple effect on the entire year. "I get concerned when I think about what's going to happen for the rest of 2000. If we have this huge stockpiling taking place [among patients], ... it causes a forecast nightmare for a manufacturer," she explained. Annual forecasting drives all phases of production, from ordering raw materials to scheduling the manufacturing itself. Hoarding, or stockpiling, at the end of 1999 would make it extremely difficult for drugmakers to determine what demand will be months down the road. Unfortunately, the ebb and flow of manufacturing cycles only complicate the matter further. Production drops dramatically at the end of the calendar year , according to Steve Perlowski, director-industry affairs for the National Association of Chain Drug Stores. (Perlowski was unable to attend the conference, but his remarks were presented by moderator Bob McHugh of Bischoff & Gaffney Associates, which hosted the meeting.) Perlowski said that companies make time at the end of the year to clean equipment and do preventive maintenance before starting the process anew . The timing could not be worse if hoarding does occur among patients , according to Doug Long, v.p. of trade relations for IMS Health, a consulting company. Long told conference attendees the amount of product in the supply-chain pipeline tends to be at its lowest in December . "If there is a hoarding mentality, it will be [at] the time when months' supply is at the lower point for the year," he explained. Actually, Long said, recent supply-chain history indicates that the industry may have gotten too efficient for its own good in this situation. "Inventories are running a lot leaner than they have in the past ," he pointed out. From 1989 to 1991, the average supply of product inventory in the supply pipeline was approximately 1.2 months. Last year, it was down to approximately one month's supply. Those who advocate stockpiling -- among them, the Red Cross -- have suggested that patients keep up to three months' worth of product on hand. . . . Since the basic question -- how consumers will behave -- is unanswerable, potential solutions are elusive. The most promising one may be fighting the perception battle that Loeb referred to. . . . Perlowski, through moderator McHugh, suggested that a public relations and education campaign is an immediate need -- and may be the industry's best hope. "People react out of their perceptions and create reality," he said. "Let's assure American consumers that there will be an adequate supply of essential goods available through the current distribution system and discourage significant stockpiling." [FYI - I'm following the Red Cross recommendation.] Cheryl WELCOME BACK!