Sustainability is a combined responsibility
Managing our supply chain
Our manufacturing, procurement and logistics functions provide more than 100 medicines, over 140 diagnostics instruments and over 850 diagnostic tests to patients, laboratories and healthcare professionals worldwide. Whether we are developing an innovative medicine or manufacturing a new diagnostic device, we integrate sustainable thinking and practices throughout our supply chain. The goal is to respond quickly to market developments and ensure reliable product supplies, while reducing our environmental footprint and ensuring high social standards.
We seek to build a resilient supply chain by adhering to best practices, developing novel approaches and working in partnership with our suppliers. Business continuity planning and risk management are the cornerstones of our approach. Also, following our sustainable supply chain strategy, we incorporate environmental, social and governance responsibilities into all aspects of our operations – from research into new products, through to delivery to customers. We engage in activities aimed to:
- identify and respond quickly to risks to supply chain quality and stabilitybuild spare manufacturing capacity
- build spare manufacturing capacity
- maintain appropriate inventory levels
- provide manufacturing flexibility by registering two or more sites, for production of certain products, or “dual sourcing”
We also work with suppliers to increase supply chain resiliency for crucial raw materials that are sole-sourced or have long lead times.
Procurement teams work closely with our business partners and suppliers along the value chain to manage business and operational risks and opportunities. To create maximum value, we look at total cost of ownership, a holistic approach that helps determine the long-term benefits and costs of a purchasing decision.
While procurement is organised by division, procurement policies, processes and systems, along with large-volume spend and risk management, are closely aligned across the Group. The objective is to ensure sustainable performance and adherence to best practice and industry codes.
Our pharmaceutical manufacturing network produces medicines for commercial supply. With some of the world’s most sophisticated biopharmaceutical production plants, the Roche network hosts the industry’s highest global biologic production capacity.
The Roche Diagnostics manufacturing network produces state-of-the-art instruments that perform more than 850 diagnostic tests.
In both networks, our processes and facilities are maintained to rigorous safety and health, quality and environmental standards.
Logistics & supply
As one of the world’s leading pharmaceutical companies and the global leader in diagnostic testing, we take seriously our responsibility to deliver our products safely and securely.
We use product-specific solutions to ensure the reliable and uninterrupted delivery of our products, including:
- integrated logistics suppliers that provide land, air and sea freight services
- temperature controlled containers to prevent damage to products or medicines
- special handling and monitoring to ensure the integrity of sensitive products
- closed cold-chain solutions for biologic medicines in compliance with all legal regulations
- security measures throughout the supply chain to prevent theft or tampering
We also seek reliable transportation companies to prevent supply shortages and shipping delays of our medicines and diagnostics to patients.
Importance of suppliers
We rely on a large and diverse global network of suppliers to support the development, manufacture and delivery of our innovative medicines and diagnostics worldwide. Comprising about 60,000 suppliers, roughly 40,000 in Pharmaceuticals and 20,000 in Diagnostics, this complex, highly regulated system spans 6 continents, about 80 countries and many cultures.
Our suppliers of materials provide products, such as raw materials and active pharmaceutical ingredients, packaging and contract manufacturing. We further use service providers to supply temporary labour, laboratory equipment and IT support, as well as contract research, marketing services, consultancy and various other services.
Our suppliers play an important role in Roche maintaining its competitive advantage: discovering, developing, manufacturing and providing innovative diagnostic and therapeutic products that deliver significant benefits to patients. In fact, the depth and breadth of our supply chain is central to our business, helping us improve efficiencies, exploit the latest technologies and redeploy resources to vital areas of our business such as R&D.
When selecting suppliers, we seek innovative products, services and ideas that will contribute to the growth of our dynamic business. We also seek suppliers that share our commitment to sustainability. Our approach is to develop long-term supplier relationships, with the aim of improving both of our businesses and the world we live in.
Our business critical suppliers - some 1,000 who meet certain risk criteria - provide materials, logistics and distribution services or contract manufacturing essential to our Pharmaceutical and Diagnostics Divisions. We work with many of these businesses to help them improve their quality systems and expand capacity sustainably as needed.
Increasing Supplier Standards across the Industry
Roche is a member of the Pharmaceutical Supply Chain Initiative (PSCI), a collaboration of more than twenty pharmaceutical companies and suppliers to the industry with the mission to establish formal industry guidelines about ethics, labor, health & safety, the environment, and management systems. Roche has included the PSCI Principles in the Roche Supplier Code of Conduct. Through the PSCI collaboration we aim to leverage the increase of supplier sustainability standards. We support our suppliers to build capacity to operate in a manner consistent with our Supplier Code of Conduct. PSCI has built and implemented a supplier audit program that allows suppliers to share audit reports with PSCI members. We conduct supplier sustainability audits under the PSCI protocol to ensure compliance with the Roche Supplier Code of Conduct. In 2016 we received 51 audit reports and filled-in supplier self-assessment questionnaires via our PSCI collaboration vs. 32 in 2015, allowing us to waive the need for own audits. This helped us reduce duplication of audits. In 2016 we conducted 133 supplier sustainability audits. We had more than 1,000 findings from these audits. We helped the suppliers if needed and conducted follow-up audits in order to ensure that the findings were addressed properly.