If you want to start a pharmaceutical distribution business you must first purchase a license to sell product. After you’ve acquired your licenses, you are then responsible for following specific guidelines in accordance with industry regulations around product traceability, supply chain management, and reporting. The licenses you acquire dictate what type (class) of product you can sell, and to what geographic location, and then the guidelines in place will vary depending on this information. In general, regulations are based on specific types of products such as over-the-counter drugs, prescription drugs, and controlled substances. Agencies such as the FDA are responsible for monitoring licenses and ensuring that each distribution company adheres to the proper regulations.
So, how does a company ensure they comply with regulations? The best solution for managing these requirements is to implement pharmaceutical accounting software as soon as possible. Pharmaceutical accounting software not only helps your business comply with regulations but also provides tools for managing all other aspects of the business, including accounting, order entry and processing, customer relationship management, warehouse management, inventory and more. Given the nature of the industry, it is important that any system you implement is supported by a vendor who actively monitors changes to regulations in order to add new functionality as needed.
As a start-up business, finding the funds and resources necessary to implement software can be difficult, but the idea is that the right solution will help your business grow and reduce costs in the long term. It is important to compare any costs associated with the software against the costs of manual processes – in terms of the effort it takes to comply with regulatory requirements and the potential consequences in the event of human error.
Once you have applied for your licenses it can take a while before they are approved. However, this waiting period is the best time to start searching for appropriate software, so that you have a solution in place as soon as possible after you receive your licenses. Ideally, you want a proper solution in place before you purchase product and receive items into your warehouse. One of the biggest mistakes companies make purchasing pharmaceutical accounting software is underestimating the time it takes to evaluate, select, and then implement the software. Even as a start-up business, this process can take anywhere from 3-6 months which is why it is important to start extensive research and engage in discussions with vendors while waiting on your licenses to come through.
As soon as you receive inventory into your warehouse, regulations come into play. Once again these regulations will depend on the licenses you have, but requirements from a functionality standpoint center mostly around product pedigree, traceability, reporting and customer license management. At a minimum, you want functionality to track lot numbers and expiry dates of products, identify vendors along the supply chain to track the specific product back to the manufacturer, automatically generate and send reports to specific governing agencies and ensure that your customers have a valid license to purchase the product being sold.
Keep in mind that it is hard to coordinate the timing of receiving your licenses with implementing software and purchasing inventory. This is especially true given that software implementations do not happen overnight. However, even if you have to manually manage processes in the beginning, the sooner you get a new system in place the better.