Curriculum
- 6 Sections
- 36 Lessons
- 1 Day
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- Understanding COGS in Pharma Manufacturing6
- 1.1Key components of COGS: Raw materials, labor, manufacturing overhead
- 1.2Cost of manufacturing vs. cost of distribution
- 1.3Fixed vs. variable costs in pharma manufacturing
- 1.4Regulatory impacts on COGS (e.g., GMP compliance, packaging standards)
- 1.5Gross margin calculation and interpretation
- 1.6Quick diagnostic – Identify the COGS breakdown in their current organization using an industry benchmark
- Cost Drivers & Impact on Profitability7
- 2.1Material costs: Sourcing, inventory holding, and procurement strategies
- 2.2Labor costs: Productivity, shift patterns, and outsourcing vs. in-house production
- 2.3Overhead management: Energy, utilities, and regulatory compliance
- 2.4Economies of scale and production efficiency improvements
- 2.5Margin dilution: Price erosion and competition
- 2.6Case Example: GlaxoSmithKline and Novartis – optimizing COGS through lean manufacturing and supply chain cost management
- 2.7Group activity – Identify cost reduction opportunities in their supply chain and production lines based on a real case study
- Pricing Strategies & Margin Optimization7
- 3.1Understanding pricing models: Cost-plus, value-based, and market-driven pricing
- 3.2Impact of price sensitivity and regulatory price controls on COGS
- 3.3The role of distribution and logistics costs in pricing decisions
- 3.4Bundling strategies, rebates, and discounts as levers for margin management
- 3.5The balance between price, cost reduction, and customer value proposition
- 3.6Example Sharing: Pfizer’s approach to pricing complex generics and branded drugs for competitive positioning
- 3.7Simulate a product launch, factoring in COGS, market pricing, and profit margin targets
- Financial Impact of Regulatory Compliance on COGS7
- 4.1Impact of GMP (Good Manufacturing Practice) on production costs
- 4.2FDA, EMA, and other regulatory standards — testing, validation, and certification costs
- 4.3Managing compliance documentation and audit trails
- 4.4Cost of non-compliance: Fines, recalls, and reputational damage
- 4.5Strategies for reducing compliance costs without compromising quality
- 4.6Case Insight: How AstraZeneca and Roche manage regulatory compliance costs while maintaining healthy profit margins
- 4.7Exercise: Design a cost optimization plan that balances compliance and cost-efficiency for a new product line
- Supply Chain Optimization & COGS Reduction Strategies6
- 5.1Lean inventory management: Just-in-time (JIT) vs. Just-in-case (JIC)
- 5.2Vendor management strategies for cost control
- 5.3Cost-to-serve analysis: Distribution, warehousing, and logistics costs
- 5.4Integrating ERP and AI for real-time supply chain visibility
- 5.5Collaborative supply chain models and cost-sharing mechanisms with distributors
- 5.6Supply chain simulation – Optimize an end-to-end supply chain model to reduce COGS and enhance cash flow using a simple ERP-based tool
- COGS Management Roadmap3
Key focus areas for cost reduction, Final COGS management roadmap presentation for senior leadership
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