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Ethypharm increases production by 15% with DynaSys and Preactor
Friday, May 20, 2011
Ethypharm, 4 years after choosing Dynasys and Preactor: “since 2008 we have been able to absorb from 10 to 15% of additional productivity, without any increase in Resources or costs” – Jean Pascal HARDY

Production gains achieved without any increase in costs or personnel

Ethypharm, a leading pharmaceutical manufacturer, has completed the total integration of its planning, scheduling and sales forecasting capabilities with its Enterprise Resource Planning (ERP) and Supply Chain system. The company’s initial need was to streamline the business by harmonizing the tools and methodologies used throughout the business at different sites. Previously the company relied on Excel spreadsheets which could not consolidate, plan and transmit information securely, nor did it have a centralised integrated information management system. The project involved the Director of Information Technology and the Director of Supply Chain Management with the company having recently adding a state of the art Advanced Planning and Scheduling (APS) system with Preactor.

EthypharmCustomers, culture, mobilisation of the staff, innovation, operational excellence…
These are the values of Ethypharm, one of the first laboratories that specialised in the development and manufacture of innovative medicines. In Europe, the United States in China and the Japan, the company annually invests 15% of its turnover in Research and Development. Its patented technologies bring multiple benefits to patient healthcare including improving the efficiency, administration and monitoring of treatment as well as reducing side effects.

Ethypharm provides its customers with solutions for the management of the product lifecycle of their pharmaceuticals. The group now has one of the most comprehensive technology portfolios (1,900 patents) and is at a global level, the preferred partner of many pharmaceutical laboratories helping to develop the medicines of tomorrow.

The company is defined as an international SME, or as is more commonly preferred today, an ETI (company of intermediate size). It has a presence on three continents, has 800 collaborators including more than 600 in France, and had a turnover of EUR 130 million in 2010. 70% of this was achieved in Europe and its 1.8 billion doses manufactured per year make it a key player in the pharmaceutical market.

Its mission is to benefit patients through galenic innovation, particularly with regard to pathologies related to the central nervous system, Gastroenterology and Oncology, general pain management and making pharmaceuticals safer and more efficient.

Business Challenges
With over 700 references sold, 3 levels of Bill of Materials (BOM) on raw materials and finished products and a strong growth in volume and turnover, Ethypharm commenced drafting the specification for a Demand & Supply Chain Planning solution in 2006, later enhanced in 2009 when the company began searching for a detailed scheduling solution. The key objective was to improve the physical flow of product as well as information by improving the reliability of sales forecasting as well as long, medium and short term production planning across 3 sites.

"After a comprehensive study of the market in 2006, we chose DynaSys as it covered almost all of our needs," says Jean-Pascal Hardy, Ethypharm Supply Chain Director.

Implementation began in 2007 with DynaSys Production Planning followed in 2008 by the DynaSys Demand Planning module with Preactor being seamlessly integrated with DynaSys in 2010. Jean-Marie Largouet, Director of Information Systems explains the attraction of the DynaSys solution. "We were very impressed by the integrated and modular nature of the solution proposed by DynaSys. This has enabled us to establish a coherent deployment that met our specific requirements as well as our overall business plan.” He continues, “Its integration with our Production Management Software, Protean by Infor, provides a secure flow of information in addition to strengthening the quality and availability of these flows.” To achieve this, a strong partnership with the DynaSys and Preactor teams was necessary, a partnership which has proved very successful.

Key Objectives
The company had 5 key objectives:
(1) Improve and consolidate the data
(2) Improve production and supply chain planning
(3) Implement a centralized management of sales forecasting
(4) Establish a collaborative/fully integrated solution
(5) Optimise customer service levels

Reviewing these objectives 4 years later:

(1) Prior to n.SKEP, it took 3 weeks for Ethypharm to consolidate its data. "We launched the consolidation and Excel calculations in week 1 and only had the results at the Sales and Operational Planning (S&OP) meeting 4 weeks later” comments Jean-Pascal Hardy. He continues, “The results were not always 100% reliable either” ”It now only takes 1 week to get consistently reliable results, updated and coherent from all 3 sites”.

(2) Prior to this, production and supply chain planning was too complex to be managed with Excel spreadsheets. Hardy again, "At best this was not a dynamic representation of information about what was actually happening and going to happen, it was simply a presentation of data." Now however, Ethypharm is able to anticipate its peaks in production, its material and workforce constraints, and can switch manufacture of a product to a different site when appropriate. “The system allows us to anticipate bottlenecks, balance and improve the distribution of the workload over our different production resources" remarks Hardy. Largouet adds, "Considering our activity, our business must be agile and responsive to meet the needs of our customers and our management systems must also contribute to this.” The solution also offers the possibility to calculate a MRP (need Net) used for basic procurement plan. A forecast based on the upcoming 12 to 15 months purchases are regularly sent to suppliers. In addition, the system has enabled the laboratory to manage integrated Sales and Operations Planning (S&OP).

(3) The establishment of a centrally managed sales forecast has been a real asset, a decision making tool for the entire company as Hardy explains. "With DynaSys we have even been able to model a business plan for the next 2 to 5 years, with different scenarios depending on our needs and those of the market." He continues, "This solution allows us to have better visibility of the overall processes and helps us to define the investment needs of the group." Largouet adds, “this is a customisable and flexible solution that adapts to the ongoing needs of our entire organisation."

(4) The collaborative approach made possible by DynaSys improves the flow of information between the Ethypharm Board and the Supply Chain Management team. The improved reporting also delivers much more relevant information which helps at every level of decision making.

(5) When it comes to customer service level the figures speak for themselves. Since the implementation of the system, customer service levels have increased by 15-20% between 2008 and 2011 with Ethypharm aiming soon to achieve a 95% service rate level.
This is not the end however as innovation remains an ongoing process at Ethypharm. “The establishment of a Lean Management approach is continuing to drive further improvements within the company and all solutions have to follow this evolutionary approach”, remarked Largouet.

EthypharmA collaborative approach to scheduling brings further benefits to Ethypharm’s customers

When it came to optimising the scheduling of the workshop, Ethypharm turned to a trusted partner of DynaSys, Preactor International. In 2010, Preactor’s Advanced Planning and Scheduling (APS) solution was deployed centrally and at each production site.

Ethypharm’s main objective were:
1. To achieve detailed scheduling on a short term horizon (0-3 months) taking into account the company’s internal constraints and rules.
2. To increase reliability then decrease the cycle times of the whole supply chain – production, quality control, and quality assurance.
3. To minimise wasted time, a process which was entirely in keeping with the company’s Lean Management approach as Hardy explains. “Preactor is a structuring tool. It allows us to have more detailed visibility at the detailed scheduling level and perfectly complements the DynaSys solutions.” He continues, “Thanks to its ease of use and the reliability and accuracy of the information it generates, Preactor is used for monitoring and optimising our workshops.”

The final word however goes to the Directors of IT and Supply Chain Management.

Jean-Marie Largouet, IT Director. “This project has enabled us to seamlessly integrate class-leading and modular Best of Breed solutions into our integrated business management information system. We have been able to gain functional richness without altering the reliability and security of our existing solution. On the contrary, we have strengthened and improved it while maximizing our productivity.”

Jean-Pascal Hardy, Supply Chain Director. "I'll be pragmatic in my conclusion and base it on the results. The processes that we have put in place and the tools that have accompanied these have enabled us to improve our cycle times, optimize inventory and rotation periods (-20% over 3 years). They have also helped us to increase our productivity. Indeed, since 2008, we have absorbed 10 to 15% of additional production, without the need to increase our teams and our costs. Therefore, if we had to do it again, we would do the same thing. “

Summary of solutions chosen by Ethypharm
• n.SKEP Demand Planning: Collaborative forecasting and demand planning solution for the launch of new products
• n.SKEP Production Planning: Multi-level production planning and optimisation solution (peak and PDP)
Preactor APS 500: Production scheduling solution

About DynaSys
Started in 1985, the DynaSys Company appears among the European leaders in the field of expertise and collaborative Demand & Supply Chain Planning solutions. Its integrated collaborative supply chain solution covers all processes of the supply chain at the strategic and tactical level and allows the development of Sales Forecasting, Sales Planning and optimizing multi-level distribution, production and supply. DynaSys is active in many industry sectors including distribution, agri-food, consumer goods (CPG), health (pharmacy, chemistry and cosmetics), fashion, and luxury. DynaSys has more than 250 clients distributed across the world, including Aim International, Cadbury, Dorel Europe, Ethypharm, Ipsen, Labeyrie, LVHM, March, Martell, Mumm, Perrier-Jouët, Piaget, and Valeo,