BANGLADESH UNIVERSITY OF PROFESSIONALS

Subject: Strategic Supply chain Management

Subject code: SCM 8605
MBA (Professional)

ASSIGNMENT

Submitted To
Asst. Professor Sharifuddin Ahmed Lisan

Submitted By
Md. Repon Hossen
MBA (Professional)
Roll No. 19020008
Date of submission November 30, 2020
Introduction
In Bangladesh Pharmaceutical sector is one of the most developed hi tech sector which is
contributing in the country's economy. After the promulgation of Drug Control Ordinance -1982,
the development of this sector was accelerated. The professional knowledge, thoughts and
innovative ideas of the pharmacists working in this sector are the key factors for this
development. Due to recent development of this sector, we are exporting medicines to global
market including European market. This sector is also providing 95% of the total medicine
requirement of the local market. Leading Pharmaceutical Companies are expanding their
business with the aim to expand export market. Recently few new industries have been
established with hi tech equipment and professionals which will enhance the strength of this
sector. There are several sectors on which Bangladesh can be proud of and undoubtedly the
pharmaceutical sector is one of these sectors, rather it is the sector, which is the second-largest
contributor to the government exchequer.

Supply Chain Management (SCM) practices can significantly impact one aspect of
organizational outcomes, i.e., Supply Chain Management of drug manufacturers in the
pharmaceutical industry. In particular, in this era of globalization, how firms garner competitive
advantages while coping with multifarious challenges, both domestic and international, has
consumed a considerable amount of attention. As effective SCM provides benefits that transcend
across the entities on both upstream and downstream sides, firms are realizing the potential of
integrating their external supplier-firm-customer relationships and internal operational practices
with a view to enhancing their level of competitiveness and performance as well as customer
satisfaction. A sound understanding of SCM practices thus assumes utmost importance in coping
with the global competition and sustained profitability. Now we can say that a good Supply chain
Management practice can achieved the company goal & inefficient supply chain destroy the
industry. The extant literature sheds light on SCM practices from different perspectives with a
shared objective of ultimately improving firm performance. In this study, three dimensions relating to
both hard and soft aspects of SCM practices, namely, collaboration and information sharing, IT
infrastructure and organizational culture with their hypothesized relationships.
Company Information:
Renata Limited (formerly Pfizer Limited) is one of the leading and fastest growing
pharmaceutical and animal health product companies in Bangladesh. The company started its
operations in 1972 as Pfizer (Bangladesh) Limited. In 1993, Pfizer transferred the ownership of
its Bangladesh operations to local shareholders and the name of the company was changed to
Renata Limited. The core businesses of Renata Limited are human pharmaceuticals and animal
health products. In Bangladesh it is the 4th largest pharmaceutical company and the market
leader in animal health products. In addition, Renata products are exported to Afghanistan,
Belize, Cambodia, Ethiopia, Guyana, Honduras, Hong Kong, Kenya, Malaysia, Myanmar,
Nepal, Philippines, Sri Lanka, Thailand, United Kingdom, and Vietnam. The Company is listed
on the Dhaka Stock Exchange with a market capitalization of over USD $1 billion. The
Company has ten manufacturing facilities spread over three manufacturing sites. Distribution of
products is carried out by 19 depots across the country. Renata employs over 8,000 people. At
present, Renata manufactures about 300 generic pharmaceutical products including hormones,
contraceptives, anti-cancer drugs, oral preparations, cephalosporins, parenteral preparations as
well as other conventional drugs. In addition, they also offer about 95 animal therapeutics and
nutrition products.

The pharmaceutical business registered a growth of 8 percent and Renata’s market rank
improved from 5th to 4th. In the Animal Health business Renata retained its no. 1 position. It is
noteworthy that animal health products were exported for the first time in the history of the
Company. It informed that Renata’s Potent Product Facility was accredited by the Medicines and
Healthcare products Regulatory Agency (MHRA) of the UK, the first potent facility in
Bangladesh to receive such recognition.
Industry Information
The modern flourishing pharmaceutical industry of Bangladesh has its root in Drug Ordinance
formed in 1982. The rules and regulations of the Drug Act forms the foundation of the current
industry. Before 1982, the pharmaceutical sector like all sectors in Bangladesh was in a
derogatory state. The industry suffered the greatest negligence during the Pakistan regime. Most
multinational companies had their production facilities in West Pakistan giving Bangladesh little
opportunity for technology transfer. After the country’s independence in 1971, Bangladesh was
in turmoil with an unstable economy and a poor base in pharmaceuticals. Insufficient funds
constrained the government’s scope to invest in the health sector for several years. The majority
of the population had little access to life saving drugs. The situation remained the same till 1982
when the Drug Act of 1982 was formed preceding the poorly planned Drug Act of 1940.

Multinational companies controlled the pharmaceutical market in the pre-1982 era. In 1981,
there were 166 licensed pharmaceutical manufacturers in the country but local production was
dominated by 8 multinational companies who manufactured about 75% of the products. There
were 25 medium-sized local companies who manufactured 15% of the products and the
remaining 10% were produced by other 133 small local companies who were capable of
producing only simple liquid formulations. All these companies were mainly engaged in
formulation out of imported raw materials involving an expenditure of BDT 600MM in foreign
exchange. In spite of having 166 local pharmaceutical units, the country had to spend nearly
BDT 300MM on importing finished medicinal products. A large number of People Don’t know
that Pharmaceutical Companies name. So, People go to the Medicine shop and buy Medicine any
Company. So, we hope that it’s very important to know for every people Top 10 Pharmaceutical
Companies in Bangladesh.

Top 10 Pharmaceutical Companies in Bangladesh

1. Square Pharmaceuticals Ltd.
2. Incepta Pharmaceuticals Ltd.
3. Beximco Pharmaceuticals Ltd.
4. Renata Limited.
5. Opsonin Pharma Limited
6. Eskayef Bangladesh Ltd.
7. ACI Limited
8. Aristopharma Ltd.
9. Healthcare Pharmaceuticals Limited
10. ACME Laboratories Ltd.
Company Specifics Related to Decision: Supply Chain Management at Renata Ltd.
My selected company is Renata Limited. This company belongs to the Pharmaceuticals Industry.
Currently the industry is very much profitable and there is a very high probability that the
industry will remain profitable in the future as well. Now we discuss about Renata Ltd. Supply
Chain Management (SCM). Renata Ltd. Use Enterprise Resource Planning (ERP) for make any
supply chain planning. Renata Ltd. Made production plan (PP) & Material Requirement Plan
(MRP) by using ERP.SCM Renata Make PP & MRP for yearly basis but every month reviewed
it.
Flow chart of Renata Ltd. Production Plan

How Renata Generate

Production Planning

Collect Information from

Sales Department

Collect all Level

FG Stock Data

All Data Run By ERP

by ERP

Production Plan
 After production plan Renata Ltd. Generate Material requirement plan (MRP).

Flow chart of Renata Ltd. MRP

Collect all Material

Stock Data
How Renata Generate MRP

MRP
Run By ERP
Collect Local
procurement Lead
time Data

Collect Import
procurement Lead
time Data
As per MRP procurement department procure material from approved supplier. Supplier
delivered material as per quality control department (QCD)approver standard followed by
procurement department schedule. Material management Team received material physically &
by ERP. Renata limited quality control department (QCD) is stakeholder of Batch size
generation in ERP. By the typing mistake they input the batch size 27000 box instead of 2700
box a product of Renata limited that’s name is Anorexon Tabs.10x6s. As a result, a big
Production plan & Material Requirement Plan was generated. That sow in the below Table.
Generate Production Plan:
Product Name Batch Size wrong Product Production Plan Production
Actual Batch Size Required Actual Plan Wrong
Input Batch
Anorexon Tabs.10x6s 2700 27000 10 27000 270000

Generate MRP:
Product Name Item Batch wrong Batch Product Production Production
Primary Size Size Input Required Plan Actual Plan Wrong
UOM Actual Batch
IFC Pcs 2700 27000 10 27000 270000
Printed Foil kg 27 270 19 270 2700
Insert Pcs 2700 27000 10 27000 270000
RM API kg 5 50 10 50 500
Film: PVC 309mm ( 250 mic.) Kg 30 300 10 300 3000
Shipper Pcs 10 100 10 100 1000

In the above table we see the problem of one stage mistake make big problem for planning. One
batch size information effect production planning & MRP. All the inventory are increase 10
times. Production plan is increase by 10 times. Production team cross check the PP with hard
copy batch size with SCM department. They find the problem of batch size problem in ERP. But
already all material purchases the procurement department. As a result, all level related material
is over stock. That’s why more than 25% material are expired that’s cost was BDT.Two million.
Warehouse face space problem long time. After that incident Renata Ltd. SCM & QCD cross
check their batch size data ERP with hardcopy. They also made a common guideline for
checking PP & MRP abnormality. When production & Procurement team found any abnormal
plan, they must cross checking with SCM team about the abnormality.
Summary
Supply chain management is the important for all industry. Production plan & Material
Requirement plan is the vital part of SCM. In the above case study, we find an important lesson
any small data can changed the total scenario of PP & MRP. So, we care about data collection
for generate any PP & MRP.

What types of problem faced RENATA?

• Over stock Problem
• Space Problem
• Financial Loss Material
• Regulatory issue for MDR
• Financial Loss for holding Cost

What meagres take RENATA

• All ERP data checked with the hardcopy data source
• Production Plan cross checking production team with SCM if they find any abnormality.
• Procurement team Cross checked MRP with SCM if they find any abnormality.
• Made a common guideline for ERP data input.

Reference:
https://renata-ltd.com
https://en.wikipedia.org
https://www.informer57.com