Working in the life science industry brings a lot of enjoyment to employees and the patients and families they serve. The pace of medical and technological advancement provides better treatment for millions of people daily across the globe through healthier and longer lives. With these advancements, the average age in the US has increased in the past 100 years, from a life expectancy of 55 to 80 years[i]. In support of the doctors and scientists who develop new drugs and devices, procurement and supply chain professionals provide tremendous support to their organizations through their work managing hundreds and thousands of suppliers needed to make drugs, devices, and diagnostic equipment.
The combined revenue from US manufacturers of drugs, devices, and diagnostic equipment generates over $1 trillion in annual revenue and touches everyone’s life in some fashion. As an industry, there is a vast supply base in the US and outside, requiring supplier management, negotiation, finance, and leadership skills to manage supply cost and risk. Over 600,000 people are employed in pharmaceutical and medical device companies in the US. Procurement managers can earn between $127,420 and $132,240 in annual wages plus benefits, which can include lucrative stock options.[ii]
For those interested in working in a life science company, it is important to understand two relatively unique aspects of the industry:
US federal law enacted to protect human health and promote wellness is governed across multiple departments and led by the Secretary of Health and Human Services. Federal agencies such as the FDA, CDC, NIH, CMS, and OIG oversee just about every aspect of a life science company, from R&D to production to sales to post-market activity. Understanding and appreciating the regulatory oversight is an essential part of a company. The company and/or its leaders and employees can be held responsible if they do not follow laws and regulations.
Due to the complexity and uniqueness of the human body, there is ongoing pressure for life science companies to maintain a high level of new product development to serve rapidly growing and diverse human health conditions. The knowledge to solve these medical problems resides across the marketplace, requiring companies to partner with research organizations, physicians, government agencies, patient advocacy groups, contract manufacturing organizations, and several other suppliers. The cost in terms of dollars and time can be immense—a new drug can cost between $1-2 billion to develop and take 5-10 years to bring to the market.
In the middle of this process, procurement and supply chain professionals can bring together suppliers and colleagues to meet these challenging requirements. If you are interested in continuous learning, data analytics, collaboration, and partnership, there is an opportunity to work with one of the thousands of life science companies. Educational backgrounds vary from business and supply chain to biology and chemistry degrees. Often employees in the industry will have advanced degrees as well. While a formal education is important when starting at a company, there is an ongoing need to continue learning and apply them to a procurement and supply chain role. As an example, using the power of Excel to do a quick and detailed analysis of multiple bids in a timely fashion will help an R&D team evaluate a range of supplier offerings to meet a tight project deadline. While the R&D team is focused on the science and technical offerings from suppliers, they need help evaluating the business and legal terms required to form a beneficial partnership with the supplier.
Given the aging demographics, diverse health conditions, rapid advancements in medical technology, and access to financial capital, there will be ongoing growth in life science companies. Procurement and supply chain professionals have an excellent opportunity to help their companies create health solutions for many future generations to come.