Pre-revenue pharmaceutical companies entering Phase II, IIb and III clinical trials experience massive change to their business in a period of months or years that for companies in other industries can take decades. Operational expenses soar, as clinical trials will cost between $7 million and $20 million, and staff must increase by as much as 10x to accommodate growth. During this time, companies are also starting to develop logistics and manufacturing strategies, identify distribution partners and plan for future expansion, including international markets. In addition, many companies may also be considering an IPO or eyeing acquisition targets.
It’s here that these companies begin to consider implementing a robust ERP system to replace QuickBooks or homegrown systems to manage financials and operations on a global basis. But undertaking a systems selection and implementation process during a time that feels like being strapped to a rocket can be overwhelming.
A cloud-based, highly scalable system like NetSuite has multiple benefits. By starting with just the functionality required, such as financials, a system can be implemented quickly with less complexity. A progressive approach of implementing gradually eases the stress on the stakeholders within the company while still providing immediate benefit, such as faster month end-close. The second benefit is that strategies can be more fully developed and understood before implementing additional functionality, ensuring a solution design that closely fits the needs of the organization. When functionality is added over time, expenses are also spread- out, so that an organization is only paying for functionality that it needs when it needs it.
A key consideration for pharmaceutical companies is the industry-specific functionality within the solution. Pre-built pharma functionality requires less customization, speeds the implementation and lowers the cost. The system should contain functionality to manage critical business processes such as:
As important as finding the right functionality is choosing the company that will do the implementation. Finding a company that
has implemented solutions for multiple pre-revenue pharmaceutical companies will lead to a more successful and less costly engagement. Ideally, implementation personnel should have past experience working at a pharmaceutical company, giving them a deeper understanding of the business and processes and therefore, better able to understand the requirements of the project.
One such solution comes from AdaptaLogix. It has taken the NetSuite platform and built functionality and workflows into it to meet the unique requirements of pre-revenue pharmaceutical companies, called SuiteSuccess for Pharma. The AdaptaLogix team has extensive pharmaceutical industry, technology and ERP experience. With pharmaceutical companies comprising 100 percent of their customer base, with 90 percent being public companies and half operating globally, AdaptaLogix is a unique provider of ERP with a very specialized skill set.
In selecting a platform to build the practice on, AdaptaLogix evaluated multiple systems. SAP, Microsoft Dynamics, OpenSystems, and Deltek were disqualified because they were not a good fit for pre-revenue pharmaceutical companies; they were too expensive, not flexible enough or failed to offer deployment models to fit the needs of the global, remote workforce that supports clinical, pre-revenue pharmaceutical growth.
When evaluating cloud-based systems, NetSuite offered clear advantages over many other systems. Intacct, for example, lacked the ability to handle transfer pricing needed to sell products in multiple countries whereas NetSuite supports that functionality within the platform.
No one wants to train a partner on how to implement industry-specific functionality but more so than perhaps anyone else, pre- revenue pharma companies simply don’t have the resources or the time. AdaptaLogix for Pharma provides pre-revenue pharma companies with the base functionality to automate financial processes and ensure compliance, being mindful of the unique needs of the pharma space, in as little as 90 days. From there, companies can turn on supply chain functionality, as well as other functionality like 3PL integrations and Gross-to-Net calculations, as they need it.
Financials for Pharmaceuticals
AdaptaLogix kicks off each project with a 5-hour design meeting that covers the entire financial system implementation—including providing documentation of the design, go-live plan and date of conversion. The team establishes their role as business advisor, bringing industry best practices into the session.
Financials for Pharma is the base functionality provided to all clients. It includes global financials, contract management, purchasing, approvals and controls, and reporting for SOX compliance. This base functionality is the foundation for more advanced financial planning functionality, including forecast development, department level forecast, budget versus actual and more.
Fully automating the unique purchasing and contract approval workflow required of a pharmaceutical company often presents a roadblock. As such, AdaptaLogix has developed a custom “Vendor Contract Manager” module, which handles contracts the way a pharmaceutical would. Purchase orders are good at tracking what’s ordered, received and billed for, but they’re not good at capturing services billed and the period end accruals, something that Vendor Contract Manager can handle.
AdaptaLogix has also built out an Approvals module, which gives users portal-based access to view and approve transactions. A dashboard provides the ability to see what approvals are outstanding, overdue and relevant metrics at a glance.
Supply Chain 1
Somewhere within six to nine months of commercialization, but, generally, before FDA approval, a company needs to start to think about where and how they’re going to manufacture their product at scale. They must consider how they will handle inventory costing, transfer pricing, receipts management for more complex purchasing processes and more.
AdaptaLogix’s Supply Chain 1 solution provides robust inventory management functionality tailored for the pharma client including raw materials, active pharmaceutical ingredient (API), intermediate product, final product and secondary packaging. That solution also includes functionality to handle lot control, demand planning, transfer pricing and receipts management.
The majority of clients will outsource manufacturing operations to a CMO, but AdaptaLogix can also facilitate in-house manufacturing processes by implementing GxP processes and validation in the unique way pre- revenue pharmaceutical companies require. That also includes software and services to automate quality approvals, lot tracking and traceability requirements unique to the space.
Supply Chain 2
Supply Chain 1 handles the entire manufacturing process up to the point of finished product. The Supply Chain 2 solution from AdaptaLogix enables the commercialization piece. Supply Chain 2 functionality provides integration to 3PLs—who warehouse, ship, and handle accounts receivable for the customers. That functionality also includes automating the calculation of gross to net adjustments.
What is particularly unique about the Supply Chain 2 offering from AdaptaLogix is the standardized integrations its solution provides for all three major 3PLs.
With offices in Philadelphia, Columbus (OH), and New York, AdaptaLogix has become the go-to NetSuite provider in this space, earning its reputation for its team deeply steeped in knowledge of everything a pre-revenue pharmaceutical company needs to operate
soundly, efficiently and effectively. AdaptaLogix has saved its customers hundreds of thousands in operational costs, as well as the headaches associated with getting mired in operations—all allowing them to focus on bringing lifechanging drugs to market.