The pharma ERP systems contain specialized features unique to the pharma industry. The vanilla ERP systems, on the other hand, may require additional development and testing time. Even if you have the development expertise, the lack of subject matter expertise required to enable features for this industry may lead to ERP implementation challenges. So what are these requirements for pharma?
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An example? The ability to capture multiple serial and lot numbers in different hierarchies. These features are trickier with most SMB products such as Acumatica and NetSuite which might allow one lot or serial number per item. On the other hand, the other mid-sized ERP systems such as Infor CSI and Epicor Kinetic might support pre-assigned lots and composable serializable units.
Yet these features are not enough for pharma. The pharma industry needs to capture NDC codes. Both serial and lot numbers for the same product. And the ability to issue and receive inventory based on the expiring lots. Plus, while the data structure nuances are one challenge for the pharma industry, aggressive traceability demands and penalties are a different ballgame for DSCSA compliance. So how to evaluate ERP systems that can support the needs of pharma companies? How about starting with the top 10 pharma ERP systems? To finalize this list, we have analyzed hundreds of ERP systems and their capabilities through publicly available information. The list also relies on our teams’ experience in evaluating these ERP systems for our customers. The purpose of this article is not to recommend these ERP systems but to provide a few options that you can vet further for your unique requirements.
Criteria
- Definition of a pharma company. These companies in the pharma ecosystem include pharmaceuticals, biotechnologies, cannabis, and nutraceuticals. They might also have distributors, repackagers, dispensers, and manufacturers. The list considers companies of all sizes in this ecosystem.
- Overall market share/# of customers. The higher the market share among pharma companies, the higher it ranks on our list.
- Ownership/funding. The more committed the management to the product roadmap for the pharma companies, the higher it ranks on our list.
- Quality of development: (legacy vs. legacy dressed as modern vs. modern UX/cloud-native). The more cloud-native capabilities, the higher it ranks on our list.
- Community/Ecosystem. The larger the community with a heavy presence from pharma companies, the higher it ranks on our list.
- Depth of native functionality for specific industries. The deeper the publisher-owned out-of-the-box functionality, the higher it ranks on our list.
- Quality of publicly available product documentation. The poorer the product documentation, the lower it ranks on our list.
- The pharma industry market share (and documented commitment of the publisher through financial statements). The higher the focus on pharma companies, the higher the ERP system ranks on our list.
- Ability to natively support diversified business models. The more diverse the product, the higher it ranks on our list.
- Acquisition strategy aligned with pharma companies. The more aligned the acquisitions are with the pharma companies, the higher it ranks on our list.
- User Reviews. The deeper the reviews from pharma companies, the higher the score for a specific product.
- Must be an ERP product. It can’t be an edge product like QuickBooks, Freshbooks, Xero, Zendesk, HubSpot, or Salesforce. It also can’t be an add-on owned by ISVs or VARs that sits on top of other accounting platforms.
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10. Blue Link ERP
Blue Link ERP primarily targets pharma distribution companies. It is especially suitable for companies in the QuickBooks segment with revenue under $10 million. It is unsuitable for large pharma companies or companies needing heavier manufacturing capabilities.
Strengths:
- Deep Last-Mile Capabilities for Pharma Companies. The biggest strength for Blue Link ERP would be its last-mile functionality. These capabilities include suspicious drug monitoring, CSOS and ARCOS reporting, and TI/TS/TH transmission via EDI.
- DSCSA Compliance Subject Matter Expertise. The other strength of Blue Link ERP includes their subject matter expertise and their involvement with the DSCSA community. It also includes continuous updates of their product as regulatory compliance changes regarding the data elements.
- Decent Technical Architecture. The final strength of Blue Link ERP would be its technical architecture, especially when you compare it with the other products in this category. For example, comparable products use a file-based database. But Blue Link ERP contains a Microsoft SQL Server database.
Weaknesses:
- Not Suitable for Pharma Manufacturers. The pharma companies that might need heavy manufacturing capabilities and distribution might find it limiting.
- Smaller Ecosystem and Publisher’s Financial Position. The other weakness of Blue Link ERP includes a smaller talent ecosystem. It also includes its financial standing as it is not backed by a private equity firm or a corporate investor.
- Only Suitable for Smaller Pharma Companies. Blue Link ERP is not meant for companies that will be in revenue of over $10 million.
Recent updates? Nothing substantial to boost its ranking from its current place. Yet it still maintains the ranks at #10 on our list of the top pharma ERP systems.
9. SAP S/4 HANA
Like larger products on this list, SAP S/4 HANA targets larger pharma companies. Therefore, it is especially suitable for companies with more than $1 billion in revenue and more than 1000 employees. However, it is not ideal for small to medium-sized Pharma companies.
Strengths:
- Superior Financial Control and Governance for Large Pharma Companies. Superior financial traceability and the SOX compliance support required for large, publicly-traded companies.
- Ability to Support Diversified Business Models. Supports diversified business models whether you are a re-packager, assembler, dispenser, medical device, drug manufacturer, or any of their combinations.
- Solid Best-of-Breed Options. The availability of best-in-class, best-of-breed products such as CallidusCloud for CPQ, SAP EWM for warehouse and TMS capabilities, and SAP Hybris for e-commerce for larger pharma companies.
Weaknesses:
- Limited Last-mile Functionality for DSCSA compliance. Limited last-mile functionality for DSCSA compliance, which might be pre-packaged with the smaller specialized pharma ERP systems on this list.
- Overbloated Financial Control Processes. Overbloated financial control processes, such as compliance, allocation, and approval flows, are only necessary for large organizations.
- Not Fit for Smaller and Mid-size Pharma Companies. The SMB pharma companies would find SAP S/4 HANA overwhelming and run the risk of implementation failure because of the efforts required to test and simplify the processes needed for smaller companies.
Recent updates? No relevant announcement that will directly benefit this industry. SAP S/4 HANA would be a fit for companies that are either using it as a financial reporting solution or want to build last-mile functionality on top of it. But that reduces the scope of SAP S/4 HANA substantially and because of these reasons, we have downgraded its ranking substantially. But it still maintains the rank at #9 on our list of the top pharma ERP systems.
8. Oracle Cloud ERP
Oracle ERP Cloud targets large Pharma manufacturers and distributors. Especially suitable for companies with over a billion-dollar revenue and employing more than 1,000 employees. Not so suitable for the smaller pharma manufacturers and distributors due to the overwhelming nature of the product and its processes.
Strengths:
- Deep ERP Capabilities for Large Pharma Companies. Robust core ERP features such as international trade management and supply chain planning for large pharma companies.
- Talent Ecosystem and Well-adopted Product. One of the most adopted products and has very large communities of consultants to build custom pharma-specific functionality on top of the core product.
- Ability to Support Diversified Business Models. Rich product model, and can natively support many distribution and manufacturing processes such as process or discrete.
Weaknesses:
- Limited Last-mile Functionality for DSCSA compliance. Limited last-mile functionality for DSCSA compliance, which will require an add-on or custom development.
- Overbloated Financial Control Processes. Overbloated financial control processes needed for larger companies but might be overwhelming for smaller companies.
- Not Fit for Smaller and Mid-size Pharma Companies. Finally, the SMB companies would struggle to relate to the product due to the over-bloated approval flows, allocation, commitment, and financial control processes. In addition, if you plan to disable the unnecessary functionality, it will increase the testing and configuration efforts, increasing implementation failure risks.
Recent updates? No relevant announcement that will directly benefit this industry. However, Oracle is continuously building all the capabilities present in JD Edwards to Oracle ERP Cloud. And JDE had one of the most robust products for pharma. Also, with the change in focus of Oracle to healthcare, the pharma capabilities are likely to be benefited and because of that, we have upgraded the ranking of Oracle Cloud ERP significantly. Yet it still maintains the rank at #8 on our list of the top pharma ERP systems.
7. Aptean ProcessPro
Aptean ProcessPro targets SMB process manufacturers, with pharma being one of its verticals. And it is especially suited for companies that require heavier manufacturing capabilities. However, it might not be the best fit for larger companies that need more profound financial control. It might also not suit companies with diverse business models with both discrete and process manufacturing process needs.
Strengths:
- Deep Process Manufacturing Capabilities. Including formulation management and batch manufacturing.
- Financial Stability of a Private Equity Company. The financial backing of the publisher, as it is backed by one of the largest private equity companies.
- Deeper ERP Capabilities than Smaller Pharma ERP Systems. Much bigger product than some of these specialized ERP systems, such as Blue Link ERP or Deacom, with more profound manufacturing and supply chain capabilities similar to Netsuite, Acumatica, or Sage X3.
Weaknesses:
- Legacy Interface. Because it has not received the same attention in the Aptean portfolio as some other products, such as Aptean Ross.
- Smaller Ecosystem. The adoption and the smaller ecosystems to get support for the product if you are not happy with the support provided by Aptean.
- Last-mile Functionality for DSCSA Compliance Not as Strong. Finally, its DSCSA compliance capabilities may not be as strong as the specialized pharma ERP systems such as Blue Link ERP or Deacom.
Recent updates? No relevant announcement that will directly benefit this industry. But it still maintains the rank at #7 on our list of the top pharma ERP systems.
6. SYSPRO
SYSPRO targets small food and beverage companies, Including smaller pharma distributors. Especially suitable for smaller pharma companies with diversified business models due to its native support for discrete and process manufacturing capabilities. Not as suitable for large pharma companies with multiple entities and a presence in multiple countries.
Strengths:
- Support for Formulation Management Capabilities. Built as part of the product.
- Ability to Support Diversified Business Models. Accommodates several different business models for smaller drug manufacturers, distributors, repackagers, or laboratories that might produce drugs and devices both.
- Supply Chain and Finance Capabilities. Deeper supply chain and finance capabilities than its peers, including a robust unit of measure support, bin number capabilities, inventory valuation methods, and costing layers.
Weaknesses:
- Only Suitable for Smaller Pharma Companies. Not a fit for larger companies with multiple entities and presences in multiple countries. Its design can’t allow data sharing between entities.
- Limited DSCSA Compliance Functionality. Not as robust with its support for pharma-specific functionality, especially DSCSA compliance. As a result, it may require add-ons or custom development that might be prepackaged with pharma-centric ERP such as Blue Link ERP or Deacom.
- Technical Issues with the Product. While the product has come a long way in moving away from a file-based data structure to a more reliable SQL-based data store, the users report errors with the product. And the product is not as mature as some of the other leading vendors on this list.
Recent updates? No relevant announcement that will directly benefit companies in the pharma industry. But it still maintains the rank at #6 on our list of the top pharma ERP systems.
5. QAD
QAD targets upper mid-large pharma manufacturing companies. Especially suitable for companies with the need for deeper operational functionality than the larger products such as SAP S/4 HANA or Oracle Cloud ERP. Not so suitable for the smaller pharma companies as they will find it overwhelming.
Strengths:
- Ability to Support Diversified Business Models. QAD’s data and product model allows it to serve various pharma industries with the combination of discrete and process manufacturing business models such as drug, device, and diagnostic tests.
- Process Manufacturing Capabilities. Includes process and discrete manufacturing capabilities, which is an advantage compared to other similar products.
- Rich ERP Capabilities to Support Mid- to Large- Pharma Companies. Has deep international trade management and Supply Chain capabilities, which gives QAD an edge over its larger peers as QAD will have deeper operational functionality for pharma along with these capabilities geared for larger manufacturing companies.
Weaknesses:
- Technical Architecture. It still uses a legacy programming language and is not hosted on mainstream cloud providers’ infrastructure, so finding support for QAD could be a concern.
- Primarily Targeted for Discrete Manufacturing Verticals. QAD is a discrete manufacturing product even though it targets process manufacturing. So the pharma manufacturers and distributors may not receive as much attention from QAD as discrete manufacturers.
- Talent Ecosystem. The talent ecosystem is not as prolific as SAP S/4 HANA or Oracle ERP Cloud. And because of that, you might struggle to find support if you are not happy with the support from QAD.
Recent updates? No relevant announcement that will directly benefit companies in the pharma industry. But it still maintains the rank at #5 on our list of the top pharma ERP systems.
4. ECi Deacom
ECi Deacom targets small process manufacturing companies that might be eCommerce and DTC heavy with pharma being a key vertical for them due to its product alignment. Not the best fit for companies with revenue of more than $10 to $20 million due to its limited finance and ERP capabilities.
Strengths:
- Deep eCommerce and DTC Capabilities. e-commerce and DTC-related features built as part of the product, such as route accounting and proof of delivery.
- Deep Last-Mile Capabilities for Pharma Companies. The pharma-specific capabilities that can support both distributors and manufacturers, such as master lot numbers, formulation and pre-formulation management, and weight measurement during the quality processes.
- Financial Backing of Private Equity and Technical Architecture. Deacom has an SQL-based data store and a more modern interface.
Weaknesses:
- Only Suitable for Smaller Pharma Companies. Only suitable for smaller pharma companies with less than $20 million in revenue due to its limited financial and inventory control functionality.
- Ability to Support Diversified Business Models. It’s primarily a process manufacturing product and would struggle with companies that may require both discrete and process manufacturing support.
- Weaker Supply Chain and Finance Capabilities. While the operational and e-commerce capabilities are strong with Deacom, the Supply Chain and finance capabilities are weaker with limited pricing and discounting options, inadequate UoM support, and leaner costing layers for larger pharma companies.
Recent updates? No relevant announcement that will directly benefit companies in the pharma industry. But it still maintains the rank at #4 on our list of the top pharma ERP systems.
3. Microsoft Dynamics 365 Business Central
MS Dynamics 365 BC targets SMB pharma distributors. And it’s especially suitable for pharma companies that require depth in supply chain and distribution processes, along with the platform’s flexibility to build last-mile functionality. However, it’s not suitable for larger companies or pharma manufacturers as it does not have the formulation management capabilities to support process manufacturing.
Strengths:
- Availability of Several Add-ons with Deep Pharma Capabilities. The biggest plus for MS BC is its ecosystem and add-ons from highly credible companies that could provide similar capabilities as Blue Link ERP or Deacom. In addition, these add-ons would not be as risky as those developed by an ERP reseller.
- Native Support of Packaging Serial Numbers with Lot Numbers. MS BC offers a rich data model with capabilities such as support for multiple lots and serial numbers to support the scenarios of NDC and packaging serial numbers.
- Deep Supply Chain and Bin Allocation Capabilities. MS BC has native capabilities to support pharma distributors with multiple warehouses, centralized and decentralized supply network needs, multiple hierarchies of bins, and rich UoM support.
Weaknesses:
- Would Require Add-on for DSCSA Compliance. It has limited native capabilities and would require an add-on or custom development for DSCSA compliance, such as suspicious drug reporting or TS/TI/TH reporting.
- Does not have Native Support for Formulation Management. MS BC doesn’t natively support formulation management, which would be a severe limitation for pharma distributors that might be heavy in R&D and production.
- Not Suitable for Pharma Manufacturers. MS BC is primarily suited for pharma distributors as it has limited manufacturing capabilities and can natively only support lighter assembly-centric manufacturing.
Recent updates? No relevant announcement that will directly benefit companies in the pharma industry. But we have upgraded the rankings of MS BC substantially this year due to the quality of add-ons available to support the pharma industry. And now it ranks at #3 on our list of the top pharma ERP systems.
2. Microsoft Dynamics 365 Finance & Operations
Like Oracle ERP Cloud, Microsoft Dynamics 365 Finance and Operations targets larger pharma companies with revenue over a billion-dollar and 1,000 employees. It is not suitable for smaller to medium-sized manufacturers and distributors.
Strengths:
- Deep ERP Capabilities for Large Pharma Companies. First, it is among the largest ERP products and has deep core ERP capabilities like SAP S/4 HANA and Oracle Cloud ERP, with a large majority of functionalities available in its cloud version.
- Ability to Support Diversified Business Models. Second, F&O has a rich product model to support diversified manufacturing and distribution businesses, including process and discrete manufacturing capabilities needed for larger pharma companies with several divisions with different focuses.
- Pre-integrated Best-of-breed Options. Finally, the F&O product also comes pre-packaged and pre-integrated with the MS Dynamics 365 CRM, known for its tight data model and transactional data integrity to support the territory planning for controlled substances.
Weaknesses:
- Limited Last-mile Functionality for DSCSA Compliance. Might require an add-on or custom development to support pharma-specific compliance and regulatory processes.
- Overbloated Financial Control Processes. Overbloated financial control processes, such as compliance, allocation, and approval flows, which are only necessary for large organizations.
- Not Fit for Smaller and Mid-size Pharma Companies. Finally, SMB pharma companies would find the product overwhelming and run the risk of implementation failure because of the efforts required to test and simplify the processes needed for smaller companies.
Recent updates? No relevant announcement that will directly benefit companies in the pharma industry. But we have upgraded the rankings of MS Dynamics 365 F&O substantially this year due to the quality of add-ons available to support the pharma industry. And now it ranks at #2 on our list of the top pharma ERP systems.
1. Sage X3
Sage X3 targets upper-mid to large pharma companies with less than $1B in revenue that seek a replacement for other larger products due to their weaker operational support and overwhelming workflows. Not as suitable for the smaller pharma companies that will have revenue under $50 million or the larger companies with a presence in more than 10-15 countries.
Strengths:
- Great Alternative for Large Pharma Companies. Designed for process and food and beverage manufacturing and distribution. As a result, it provides far deeper functionality for large pharma companies out of the box.
- Designed for Process and Food Manufacturing Companies. Its product and operational processes are designed for process manufacturing companies with deep support for features such as product families.
- Great Ecosystem of Consultants for Pharma Validation. The ecosystem includes consulting companies with deep expertise in the Sage X3 product and validation procedures.
Weaknesses:
- DSCSA Compliance May Require Additional Efforts. The pharma-specific capabilities might not be as robust as pharma-specific ERP systems.
- Not Suitable for Smaller Pharma Companies. Its design could be overwhelming for very small pharma companies. Might not get as much value due to the configuration and integration requirements.
- Limited Pre-integrated Best-of-breed Options. Limited best-in-class best-of-breed options as SAP S/4 HANA or Microsoft Dynamics 365 F&O for additional capabilities that larger companies would require.
Recent updates? No relevant announcement that will directly benefit companies in the pharma industry. But it still maintains the rank at #1 on our list of the top pharma ERP systems.
Conclusion
Pharma companies have involved operations and reporting needs, requiring ERP systems that have native support for the data model to meet the changing regulatory requirements. The ERP systems and vendors that don’t have pharma as their primary vertical would not be able to catch up with these demands. And might require you to develop them yourselves.
Due to the financial and implementation risks associated with the development efforts, you need an ERP system designed to support most pharma processes natively. So make sure that the ERP system you choose is designed for the pharma industry. And hopefully, this list can help you narrow down some options.
