The impact of serialisation on operational efficiency and productivity in Irish pharmaceutical sites

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O'Mahony, Daniel
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Serialisation technology was introduced to protect the pharmaceutical supply chain from
infiltration by falsified and substandard medicines. The implementation of serialisation
systems required a substantial investment by pharmaceutical manufacturers. This study
investigated the impact of serialisation on the operational efficiency and productivity in Irish
pharmaceutical sites. Ireland plays an important role in the global pharmaceutical
manufacturing network. All of the top ten largest pharmaceutical companies have
manufacturing operations in Ireland. A review of the literature showed only limited
publications on the topic of serialisation, operational efficiency, and productivity, particularly
in the Irish context. A research method was designed to assess the relationship between
serialisation, operational efficiency, and productivity. The research consisted of a survey and
interview process with 11 manufacturing sites in Ireland. Participating companies operated a
total of 114 pack-lines, representing approximately 65% of the automated packing lines in
the country. The research focused on measurements such operational equipment
effectiveness (OEE), line availability, unit cost and cost per pack. The study revealed that
serialisation had a negative impact on pack line OEE and line availability. The research found
that serialisation had a negative impact on the unit cost of packaged pharmaceuticals. The
study assessed the expected costs of serialisation with the actual costs experienced by
manufacturers. The research found that the actual capital costs of serialisation were four
times greater than the costs originally outlined by policymakers. The study identified a trend
where Irish pharmaceutical sites are moving away smaller batch production and moving
toward larger batches so as to gain greater efficiencies, The research also proposed the use
of a serialisation depreciation factor ( 𝑆𝐷𝑓) as a method to determine the impact of
serialisation on the cost of goods sold.