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Penny-wise, pound-foolish: pharma companies that sell redundant facilities could endanger their supply chains.

Article Excerpt
During the past decade, big pharmaceutical companies have been making major efforts to restructure their manufacturing networks. In their haste to shed costs and assets, however, some may be adding risk to their product supply chains.

The number of manufacturing facilities owned and operated by the major pharmaceutical companies mushroomed in the 1980s and 1990s as new blockbuster products were introduced and as companies opened markets globally. In the days before the establishment of regional free trade pacts, such as the EU and the North American Free Trade Agreement (NAFTA), much of the industry viewed having a manufacturing operation in a foreign country as a necessary investment to ensure that country's regulatory approval of their drug product.

In the past decade, however, companies have determined that they do not need to maintain large, farflung and costly manufacturing organizations around the globe. Several factors have contributed to the drive to...

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