Two thirds of pharmaceutical companies use outsourcing

The pharmaceutical industry is expected to continue outsourcing supply chain management and manufacturing IT functions

Almost two thirds (63 per cent) of pharmaceutical companies are increasingly using third-party outsourcing firms to augment or replace varying aspects of their IT responsibilities, according to IDC.

The research firm expects that the pharmaceuticals sector will continue to increase its spending on these services over the next year.

The IDC Health Insights study shows that in 2008, 48 per cent of pharmaceutical companies outsourced some aspect of manufacturing or supply chain-related IT.

Over the past two years, this number has risen to 63 per cent, demonstrating the growing importance of outsourcing in manufacturing and supply chain operations.

Industry sentiment and adoption trends all point to continued growth in IT outsourcing by between four to six per cent over the next 12 to 18 months, followed by moderate growth of approximately four per cent annually for the next two to three years.

Technologies that support increased supply chain visibility and monitoring capabilities, as well as analytics and business intelligence solutions, are expected to be the most in demand by the pharmaceuticals sector this year, IDC added.

"With the global recession now in the rear-view mirror, life science companies are slowly shifting their primary cost-cutting focus back towards long-term top-line growth," said Eric Newmark, research manager at IDC Health Insights.

"Manufacturing and supply chain strategies not only remain a critical component of maintaining lower costs, but also hold the key to reducing corporate liability, protecting brand equity and optimising operational efficiency."