Paper Info
Title
Cooperative Partnerships And Pricing In The Pharmaceutical Supply Chain
Abstract
The pharmaceutical supply chain has become highly consolidated. Currently, over 70% of all prescriptions are handled by three pharmacy benefit managers which each own a mail-order pharmacy. To compete in this environment, small and midsized pharmacies must seek efficiencies in their operations. The paper considers the value of cooperative partnerships between mail-order and chain pharmacies to leverage strengths of both players. To examine the viability of the strategy we develop a mathematical model that assesses the value of partnerships between independent organizations operating in different channels. The model is used to determine whether and to what extent pharmacies should consider partnerships that leverage a competing channel to allow mail-order customers to pick up prescriptions at chain stores in particular regions. Computational results provide insight into the impact of drug prices, reimbursement contracts, and revenue/cost-sharing policies on the optimal supply chain design and highlight conditions under which it is beneficial for chain and/or mail-order pharmacies to enter partnerships.
Year
DOI
Venue
2019
10.1080/00207543.2018.1504249
INTERNATIONAL JOURNAL OF PRODUCTION RESEARCH
Keywords
DocType
Volume
optimization, supply chain collaboration, pricing theory, pharmaceutical supply chain
Journal
57
Issue
ISSN
Citations 
6
0020-7543
0
PageRank 
References 
Authors
0.34
11
2
Name
Order
Citations
PageRank
Kathleen M. Iacocca100.34
Stephen Mahar2565.27