How the pharma sector must address sustainability

Neeshe Williams is Head of Environmental, Social and Governance (ESG) and General Counsel at Pharmanovia, a late-stage pharmaceutical company headquartered in the UK. Here she outlines Pharmanovia’s ESG targets and what the sector must do to reduce its impact on the environment.

While many industries came to a grinding halt as a result of the outbreak of the Covid-19 pandemic, this was not the case for the pharmaceutical industry. Fundamentally, the industry serves to provide essential and needed medicines to end-patients, so decelerating was simply not an option. Instead, as society navigated the pandemic, the industry accelerated.

Prioritizing the unimpeded transportation of safe, essential medicines has set the pharma industry slightly behind in terms of transitioning to become more sustainable. However, as we move into the post-pandemic era, there has been a seismic shift towards collaborating to achieve common end goals, such as improving the patient experience, upscaling ESG credentials, and reducing the industry’s carbon footprint.

The roadmap to becoming more sustainable

Now that net-zero targets have been outlined by policymakers across the globe and following the COP-26 summit, collaboration and sharing of information externally between organizations will be pivotal for the pharma industry to become more sustainable.

The industry must acknowledge that embedding and upscaling ESG credentials are not solely the responsibility of one specific department or function, but must be addressed throughout all operations, with any partners, and throughout the supply chain.

It is vital that each organization sets out achievable goals, with a clear road map of the processes and policies required to achieve them. Businesses that are prioritizing and embedding ESG objectives into their culture will set an example for others to follow. At Pharmanovia, we are proud to be setting that example as we make a conscious effort to put corporate social responsibility and ESG at the core of the business. This is demonstrated in our recently launched inaugural sustainability report which sets out a range of global initiatives.

As part of this, each employee at Pharmanovia will be set ESG targets within their annual performance review process. By establishing long-standing ESG performance targets and encouraging employees to apply a sustainable lens to their role, our aim is to fully embed ESG activities within our business identity and culture.

To galvanize all our individual targets towards a collective goal, as a business we have set out specific targets as well. These include committing to reducing our carbon emissions whilst increasing the use of recycled materials in all our products.

Strategize and prioritize

There are some additional costs associated with meeting ESG criteria which can be overcome by planning ahead, and harnessing data through technological innovation. In doing so, we can improve global access to medicines while considering ESG factors.

On the logistics side, transportation of products is a significant factor to consider when determining an accurate carbon footprint, with air freight the biggest contributor. Transitioning to sea freight rather than air where possible will undoubtedly make an impact, and this is where we have already made huge headway at Pharmanovia, by increasing our sea freight transportation by 443 percent.

Utilizing localized packaging hubs across a wide, trusted network to ship products out as early as possible will also reap significant benefits. Such a technique can improve patient access and minimize the risk of potential write-offs and consequent wastage. Considerable thought should also be given to whether traditional packaging can be replaced with recyclable, safe, cost-effective alternatives, given the broad range of options that now exist, as industries continue to place emphasis on reaching net-zero.

At the community pharmacy level, incorporating the latest technology will allow firms to implement practical, scalable system-wide frameworks, and will go a long way toward the industry’s transition to becoming more sustainable. Indeed, we must ensure every dose is used, correct quantities are ordered, and waste is significantly reduced.

Firms should also consider developing – and enrolling in – specific training programmes and platforms to further educate on ESG-specific factors and procedures. This will boost awareness and understanding of how community pharmacies can play a key role in making the pharmaceutical industry more sustainable and encourage accountability from all stakeholders.

When plotting out an ESG strategy, it is crucial to not only consider your own actions but those? of your partners if you wish to have a fully holistic view of your overall carbon footprint. For example, at Pharmanovia, we have recently set up a scorecard matrix to collate data across all our business operations, functions, and processes. We will be rolling this out to assess all our partners, with a further automated collection of our partners’ scope 3 carbon data.

Indeed, from a business-to-business (B2B) perspective, some organizations are now unwilling to work with companies that do not have robust ESG credentials, preferring to engage with like-minded organizations whose ESG strategies align with their own.

Taking a long-term viewpoint

While ensuring unimpeded transportation of medicines has set the pharma industry slightly behind in terms of incorporating sustainability, it would be foolish not to mention the financial considerations. Implementing more sustainable processes often comes at a cost. This is where utilizing technology comes into play, as harnessing data from internal and external sources can improve global access to medicines and determine beneficial formulations.

The beneficial trade-off from introducing ESG measures can be hard to quantify in the short-term, but we are incredibly optimistic that we will begin to see a domino effect from organizations taking steps to improve and expand their sustainability initiatives. In doing so, the financial costs of ESG will begin to fall.

It goes without saying that this will not be a short process, which is essential for all stakeholders to acknowledge. However, we must take confidence in the fact that the industry is moving in the right direction. Positive momentum is certainly building towards achieving common sustainability goals, while products continue to reach end-patients in the most optimal condition required.

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