Modelling availability and affordability concerns in the design and planning of pharmaceutical supply chains

Although sustainability principles have been gaining attention when managing supply chains, integrating social objectives remains an essential concern to be explored. In particular, social impact concerns related to equity in access to pharmaceutical products are crucial to be considered. This work addresses this goal and proposes a decision-support tool based on a multi-objective MILP model that integrates strategic-tactical decisions while considering sustainability principles. The social pillar is modelled using two approaches: the location of facilities to maximize access to medicines where the incidence of disease is higher; and a second approach where a metric based on the economic concept of demand-to-price elasticity is used so as to measure how sensitive markets are to medicines’ prices allowing producers to manage the trade-off between prices’ portfolio and markets, enhancing social equity criteria, without profit losing. The economic pillar is addressed through the Net Present Value, and the environmental pillar follows a Life Cycle Analysis methodology. The model is applied to a representative case study and different scenarios are analysed where it is shown how strategic and tactical decisions impact these performance indicators.