Supply Chain in the pharmaceutical industry: how to ensure full traceability for sensitive products

Health and consumer safety are fundamental priorities for any pharmaceutical company. In this field, the supply chain carries a special responsibility precisely because of the sensitivity of the products. Any deviation, no matter how small, in the production, transport, or storage process can have direct consequences on patient health. That’s why there is no room for compromise.

Every stage in a product’s life cycle, from sourcing raw materials to delivery to distributors and, ultimately, to patients, is subject to strict control through regulations and quality standards. Modern traceability solutions in pharmaceutical factories enable the automation of an extremely complex workflow.

Traceability is a key element in process management within the pharmaceutical industry. It involves the ability to track products and flows in a documented manner. More precisely, it means being able to verify the history, location, or use of a product through a registered identification system. It is a complex activity that ensures the chronological correlation of uniquely identifiable entities in a verifiable way.

What’s different in the pharmaceutical supply chain?

✅ Regulated compliance: The pharmaceutical industry is heavily regulated, with strict requirements for production, storage, and distribution to ensure product quality and safety.

🧊 Product sensitivity: Medicines are sensitive products that require special storage conditions, such as temperature control, to maintain their effectiveness and stability.

⏳ Shelf life: Many raw materials have a limited lifespan, requiring careful stock management and fast deliveries to avoid expiration.

🔄 Operational complexity: The pharmaceutical chain involves numerous actors, manufacturers, distributors, wholesalers, pharmacies, and a wide variety of products, creating logistical and coordination challenges.

🔐 Security: Pharmaceutical products are often targeted by counterfeiters, requiring robust security measures to prevent theft, loss, and diversion from the legal distribution circuit.

📈 Product lifecycle management: Pharmaceutical products have a complex lifecycle: development, launch, peak sales, then decline. This requires continuous planning and adaptation within the supply chain.

🌍 Global supply chain: Some products are manufactured, stored, and distributed across multiple countries, involving special regulatory and international logistics requirements.

🩺 Patient safety: The pharmaceutical industry has a direct impact on patient health, making it essential to prioritize product quality, safety, and efficacy.

📊 Data management: The large volume of data, from product traceability to stock management, requires efficient digital integration and analysis solutions.

⚠️ Risk management: The pharmaceutical chain is exposed to risks such as supply disruptions, quality issues, or non‑compliance, requiring strict prevention and control strategies.

🔄 Continuous improvement: The industry evolves constantly, with new products, technologies, and regulations, so the supply chain must remain agile and adaptable.

💊 Complex product portfolios: They include prescription medicines, OTC products, and biotech items, each with specific logistical requirements.

📉 Variable demand: Demand is influenced by seasonality, epidemics, and legislative changes, requiring flexibility in planning and distribution.

Traceability vs. lack of control: what is the industry risking?

1️⃣ Traceability plays a vital role in ensuring the quality and safety of pharmaceutical products throughout the entire logistics chain. By strictly monitoring variables such as temperature, humidity, and exposure to external factors, the effectiveness of medicines and vaccines is preserved from production all the way to final administration.

2️⃣ The pharmaceutical industry is highly regulated, and traceability supports compliance with national and international standards. It enables fast responses to audits and inspections, as well as full transparency across all logistics processes.

3️⃣ In cases such as the recall of a defective batch, traceability allows precise identification of affected units and their rapid location within the distribution chain. This reduces risks for patients and protects the pharmaceutical company’s reputation.

4️⃣ With real‑time visibility, traceability improves stock management and prevents losses caused by expiration or degradation. It also contributes to efficient route planning and delivery scheduling.

5️⃣ A robust traceability system enables instant verification of product authenticity, reducing the risk of counterfeit products reaching the market and threatening public health.

6️⃣ Traceability in pharmaceutical logistics is closely tied to cold‑chain control, essential for preserving temperature‑sensitive medicines.

What it involves:

• Sensors for monitoring temperature and humidity
• Real‑time recording of any movement of goods: production, delivery, receiving, storage, and re‑delivery
• Serialized tracking and geographic location
• Automatic alerts in case of deviations or limit breaches
• Compliance with regulations such as GDP (Good Distribution Practice)

Technologies used:

• IoT‑connected temperature sensors
• RFID/NFC smart labels
• GPS tracking systems
• Blockchain for immutable records
• MES (Manufacturing Execution System) applications for production traceability, from raw materials to finished products
• Integration with WMS (Warehouse Management System) platforms for monitoring warehouse activities along the distribution chain
• TMS (Transport Management System) applications for organizing and planning transport
• POD (Proof of Delivery) — an application that confirms delivery times, monitors quality parameters until handover, and ensures responsibility transfer from carrier to warehouse or pharmacy
• PMS (Packaging Management System) for tracking packaging across the logistics flow, from delivery to return

What are the benefits of an intelligent pharmaceutical supply chain?

✅ Prevents degradation and waste by detecting and correcting temperature deviations quickly

✅ Allows recalling only the affected batches, reducing financial losses

✅ Increases compliance with local and international regulations

✅ Provides real‑time visibility for all actors involved in pharmaceutical logistics

✅ Strengthens trust among healthcare providers and patients

How does serialization contribute to the traceability of sensitive products in the pharmaceutical industry?

Serialization is the process of assigning unique codes to each product package. Through serialization, manufacturers can identify every unit leaving the factory, regardless of where it ends up in the supply chain. This level of traceability allows companies to:

• Prevent fraud related to counterfeit medicines
• Ensure a higher degree of traceability, down to each individual delivery unit (medicine box)
• Withdraw non‑compliant products quickly and efficiently from the distribution circuit
• Comply with health authority regulations that require full traceability

To perform serialization correctly, manufacturers must mark every sold unit with a set of unique codes. According to regulations, these codes must include:

• Expiration date – informing retailers when to remove the product from shelves and consumers when the product is no longer safe
• Serial number – enabling the tracking of each individual product throughout the supply chain
• Batch number – documenting the specific combinations of ingredients used in production

The absence of these codes on packaging can lead to recalls, fines, and reputational damage. Therefore, it is essential to establish clear workflows for product coding, ensuring readable text and barcodes that can be easily scanned by equipment.

Modern technology simplifies this process. There are specific stages in the logistics flow where these serialization codes must be checked (scanned). This process can be time‑consuming and labor‑intensive. Technologies that reduce this time are those capable of scanning multiple barcodes simultaneously or performing continuous scanning at high speed. Manufacturers of barcode‑scanning equipment are innovating rapidly, achieving, depending on lighting conditions and distance, the simultaneous scanning of up to 100 unique codes.

How does xTrack WMS contribute to the traceability of sensitive products and to operational efficiency in the pharmaceutical industry?

The very high level of process automation we offer our clients through xTrack WMS ensures complete traceability, from the moment goods enter the warehouse to final delivery. In fact, traceability begins right in the truck, during unloading, when temperature data recorded throughout transport is captured.

This stage, called pre‑receiving, marks the moment when pallets are taken into stock and temperature conditions are transferred from warehouse equipment. Until unloading, temperature data comes from the transport vehicle (temperature chart) or from the beneficiary’s IoT temperature sensors. During pre‑receiving, information about the packaging quality of the unloaded items is also recorded.

In the receiving stage, our application guides the user step by step: what needs to be received, how to sort goods based on criteria such as storage type, product quality, or serial verification. This process increases efficiency by more than 50%, significantly reducing the time required to deliver urgent items. If goods are non‑compliant in terms of quantity, batch, or quality, they are automatically redirected to the quarantine area.

Storage – whether on pallet racks or in the picking area – is optimized for fast order preparation. Batch management in storage is essential, considering the different sales channels: hospitals, where the sales process is longer, or pharmacies. Depending on commercial conditions, the batches that must be delivered do not always follow the FEFO rule. Complex Put Away and Replenishment algorithms take these conditions into account and ensure quick access to any batch needed for customer orders.

Picking is carried out efficiently through the automatic distribution of tasks to warehouse operators, based on criteria such as skill level and availability. This ensures goods are prepared on time for verification and sorting onto distribution pallets. For small orders, Wave Picking is used, simultaneous picking of multiple orders, divided by warehouse zones into separate boxes to maintain batch traceability.

After picking, items are checked and packed. Both processes are fully automated. Validation of items prepared for delivery also includes serial commissioning, when delivery is made to a unit that does not perform decommissioning at the moment of consumption.

For transport route consolidation, an additional, simple, and fast sorting step is applied by scanning parcel codes and confirming the location (pallet) corresponding to the distribution zone or route.

What advanced functions does xTrack WMS bring to the pharmaceutical industry?

• Quality module at receiving, including legally required checks such as periodic verification of the Marketing Authorization (APP)
• Integration with the national or European medicines verification system, both at receiving and at decommissioning when needed
• Configurable workflows at article‑category level for Put Away, Replenishment, and Picking, with different validation rules for special items such as temperature‑controlled or restricted‑storage products
• Full traceability from receiving to delivery, covering all internal warehouse movements and extending across inbound and outbound transport through temperature‑chart recording
• User‑defined rules for warehouse activities: receiving, Put Away, Replenishment, Picking, Verification, etc.

Learn more about xTrack WMS here or schedule a meeting to discuss your project.

The pharmaceutical supply chain must be transparent, digitalized, and prepared for any scenario.

Axes Software transforms these challenges into operational reality, protecting the integrity of sensitive products and, above all, the trust of patients.

Learn more about us here.