Pharmaceutical distributors are the middlemen who transport manufacturers' products to pharmacies and other suppliers. According to the Healthcare Distribution Alliance (HDA), more than 22,000 independent pharmacies rely on their services on a daily basis. Wholesale distributors are the second link in the drug supply chain, purchasing pharmaceuticals from manufacturers for distribution to a variety of different locations, such as pharmacies, hospitals, clinics, doctors' offices, and laboratories. Some distributors specialize in the types of products sold or types of customers to whom it is sold, while others offer a variety of products including medicines and medical equipment.
As the healthcare system changes rapidly, distributors are constantly innovating new ways to move and protect medicines while protecting patient safety. The pharmaceutical distribution industry is said to save health systems billions each year through various investments and technological advances. Pharmacies typically purchase prescription drugs from wholesalers at a discount contracted in the WAC. Pharmaceutical manufacturers manage drug distribution from point of production to drug wholesalers and, in some cases, directly to retain pharmacy chains, specialty pharmacies, hospital chains, and some health plans.
While considerable efforts have been invested to innovate, develop and market medicines more efficiently, minimal effort has been made to reconfigure manufacturing and distribution operations or adjust the pharmaceutical supply chain network. Increased public scrutiny is needed due to increased regulation and the increased incidence of stronger risk assessment and management capabilities across the expanded pharmaceutical supply chain. Healthcare distributors offer unmatched logistics expertise, technology solutions and support to providers who treat patients on the frontline as well as those who innovate to find tomorrow's treatments and cures. The role of pharmacy benefit managers in the pharmaceutical supply chain is designed to provide an entity that focuses on improving cost savings, access, convenience and safety for consumers, employers, unions, and government programs.
While wholesale distributors are the largest purchasers of manufacturers, in some cases drug manufacturers also distribute products directly to government buyers such as the AIDS Drug Assistance Program (ADAP), the Veterans Administration, and the Vaccines for Children program (VFC). It is not the responsibility of the distributor to decide who should or should not receive a particular drug or product or for what type of patient it is suitable. Today, wholesale distributors offer a range of specialized services such as specialty drug distribution, pharmaceutical repackaging, electronic ordering services, drug buyback programs and reimbursement support, specialty pharmacy and administration. In the context of a health-conscious society managing pharmaceutical supply chains presents complexities because it involves life-saving drugs that are vital to patients. Distributors do not make clinical decisions about who should or should not receive a medication or what medication is best for a particular patient.
Pharmaceutical manufacturers have the greatest influence on pharmaceutical product prices as they assess expected demand, future competition and projected cost of marketing to establish wholesale acquisition cost (WAC).Overall, pharmaceutical distributors play an important role in ensuring that medications are delivered safely and efficiently from manufacturers to pharmacies so that patients can access them when they need them most. They provide an invaluable service by helping to ensure that medications are available when needed while also helping to reduce costs for healthcare providers.
