Maintaining efficiency across the supply chain is essential to ensure potentially life-saving pharmaceutical products reach the patients who need them. However, warehousing and distribution are frequently complicated by manual errors that can result in sensitive, high value pharma stock being mismanaged.
Failures in this area lead to poor customer satisfaction and even regulatory action if Good Manufacturing Practice (GMP) or Good Distribution Practice (GDP) guidelines are breached. With geopolitical disturbances, product recalls and increased patient demand further elevating risk across pharma supply chains, the need for optimised warehousing processes has never been greater.
The next generation of automation is helping to address many of these pain points, with robotics-based solutions and artificial intelligence (AI) boosting efficiency for storage and retrieval in a fast-moving pharma industry.
A challenging supply chain outlook
As pharmaceutical regulations diverge internationally, logistics providers must take greater care than ever to ensure products reach their destination on time and in the right conditions. Moreover, with the UN now estimating that one in six people will be over 65 in 2050, aging populations are presenting a new set of problems. Supply chains must rely on fewer workers and still meet demand for pharma products, which is only going up with the growth of anti-obesity medications and cell and gene therapies (CGTs).
In the face of these complex challenges, automation and robotics could play a significant role in making pharma logistics more efficient and flexible. According to GlobalData, the robotics industry will be worth $218bn by 2030, with the logistics robots market growing at a compound annual growth rate (CAGR) of 17%. AI integration is essential to this growth, creating robots that are highly intelligent and can perform tasks more reliably than human workers. These automations could prove critical in improving the efficiency of pharma supply chains, which depend on temperature-controlled products that need to be delivered within tight deadlines.
Solving warehousing challenges through automation
Ocado Intelligent Automation, a global technology developer and operator delivering the world鈥檚 most advanced fulfilment operations software, hardware, and processes, has developed an automated storage and retrieval system that addresses many of the problems associated with pharmaceutical logistics, creating a new benchmark with the application of robotics and fulfilment technology.
The Ocado Storage and Retrieval System (OSRS) is an ultra-high-density cubic automated storage and retrieval system (ASRS) that enables businesses to maximise order throughput, speed, and accuracy. In the online grocery delivery sector, an industry where Ocado has over 20 years of operator experience, the OSRS has already demonstrated its excellence in managing high stock turnover, order variability, and short order lead times on narrow margins.
With both the grocery and pharmaceutical supply chains dependent on delivering time- and temperature-sensitive products on schedule, the OSRS is uniquely well-placed to meet the challenges of pharma inventory management.
How does the OSRS work?
The OSRS is an ultra-secure, multi-layered, cubic storage grid system developed to maximise warehouse space utilisation. The stock storage and retrieval function is conducted by AI-orchestrated robots at high speed, which dynamically determine optimal routing, storage locations, and retrieval sequences of stock and customer order bins. The robots move products to designated picking stations where autonomous robotic pick arms or human operators prepare items for secure packing and delivery. This all happens in real time, providing accurate stock levels and minimising errors, resulting in orders being fulfilled more rapidly with reduced lead times and improved distribution accuracy.
A highly agile and sophisticated automation system, the OSRS can pick and pack a 50-item order in just five minutes. Operating under strict environmental controls combined with end-to-end traceability, the System鈥檚 grid storage is inaccessible to all but authorised personnel, a significant advantage in pharma logistics where many products, such as narcotics, cytotoxic and precursor drugs, must not come into contact with humans.
The traceability of the system makes risk and compliance easy, while ultimately reducing margins of error to improve overall service. The OSRS buffers picked orders back into the grid, storing them securely in compliant conditions until they are ready for outbound sequency. Because picked orders are not left in the open in the warehouse, the system minimises security issues including loss, theft, and damage, critical when managing valuable pharmaceutical inventory.
When it comes to temperature-sensitive pharmaceuticals, the OSRS buffers picked orders back into the grid, storing them securely in compliant conditions until they are ready for outbound sequencing. This dramatically reduces risks and inefficiencies in the dispatch process, such as damages and shrinkages. To ensure compliance with GDP, OSRS also has integrated sensors to track temperatures throughout a product鈥檚 journey, backed by automatic alarms that are triggered if temperatures deviate from required ranges, further preventing spoilage or regulatory breaches.
Algorithms to improve efficiency
OSRS is fully compatible with different pharmaceutical enterprise resource planning (ERP), warehouse execution systems (WES), and warehouse management systems (WMS). Plus, Ocado鈥檚 real-time inventory information can make demand forecasting easier, reducing the likelihood of shortages and overstocking. This software-driven approach builds productivity and performance, making the most of narrow profit margins to provide a seamless customer experience.
OSRS鈥檚 high-performance algorithms, powered by machine learning and AI, provide an additional asset for improving warehouse performance. Its smart, putaway algorithms constantly optimise warehouse 鈥榮lotting鈥� of stock during operational hours for maximum robot fleet efficiency and system productivity. Moreover, flexible picking, storage, and dispatch sequencing make it easier to meet time-critical orders, including same-day slots and next-day late cut-offs.
Its sophisticated capabilities mean it can pick orders for the longest shelf life, as well as in accordance with first-expired, first out (FEFO) policies to ensure that warehouses are getting the most out of their stock. Meanwhile, its predictive maintenance AI algorithm can identify hardware issues before they affect the system鈥檚 performance. All these attributes enable better control over processes to meet high customer expectations and strict service level agreements (SLAs).
Engineering the future
Unlike other automated storage and retrieval systems, which must be designed to meet fulfilment peaks, Ocado鈥檚 combination of on-grid robotic picking, order buffering and software smarts means operators can more evenly distribute their workforce throughout the day, eliminating idle labour and reducing or altogether removing reliance on costly, overcomplicated dispatch processes .
OSRS provides an innovation in pharmaceutical logistics that sets a new standard for automated storage and retrieval systems. Its robot picking system unites a range of automation advantages into one uniquely agile and efficient system that can rise to any time, temperature, or turnaround challenge.
