Pharmaceutical Reverse Distribution —
One Batch at a Time

By Michael Zaccaro,
Founder and President of Pharma Logistics

You’re probably familiar with the term “batch processing” in the context of pharmaceutical reverse distribution, but I’d guess you probably don’t know the details of how it works. Why should you care? Well, because it’s probably costing you money.

Imagine if your bank said, “hey, we took a guess at what you spent this month based on what you spent last month, and we issued checks to cover that amount, so you should be good.” Would you trust them? Is that all the information you’d want to know? Of course not! But that’s how most of our competitors process batch credits.

In a typical batch process associated with pharmaceutical reverse distribution, the reverse distributor consolidates and ships returns from pharmacies that have nothing in common other than the wholesaler they purchase products through. These products are then sent back to the pharmaceutical manufacturers in one consolidated shipment that might contain several hundred products from several hundred different pharmacies. It’s much more efficient for the wholesalers, manufacturers and reverse distributors to handle the returns this way. The problem is that most reverse distributors take the easy way out when it comes to issuing credits as part of a batch process. They issue credits to pharmacies based on their original estimate of what their returns are worth. At Pharma Logistics we refer to this method as percentage-based allocation of credits. Each pharmacy is issued credit based on a percentage of the original estimate.

When actual manufacturers’ credits are issued to the wholesaler, the amounts are often quite different from the original estimates. Other reverse distributors don’t bother to check that, though. Sometimes the differences work in favor of the pharmacies, but pharmacies usually end up missing out on money they should be getting back. And the loss of revenue to your pharmacy can be significant.

Pharma Logistics handles batch returns the right way. In fact, we believe the word “batch” is taboo, which is why we give our customers precision processing. We take each manufacturer’s credit memo and reconcile it line by line with the original value of the returns — kind of like reviewing a monthly bank statement. Every pharmacy gets the exact amount of credit owed. As a result, our customers end up getting up to 20% more money than our competitors deliver.

When you work with us, batch processing doesn’t mean batch credit. You get every cent you’re owed, and we’ve got the proof. I’d be glad to talk to you about it anytime. Contact us to learn more about how Pharma Logistics handles pharmaceutical reverse distribution.