Evaluation of Factors Roche

Roche’s main challenge is determining inventory levels and maintaining supply chain readiness in the event of a flu pandemic. They are dealing with wildly varied demand.

In 2005-2006, they went through enormous effort to streamline and grow their supply chain to handle more than quadruple their capacity of Tamiflu. This was in response to international concern about a potential avian flu pandemic. Their success was due, in part, to their ability to include multiple outside manufacturers without endangering their patent on Tamiflu. David Lapre, head of Supply Chain needs to determine the best way to maintain capacity and at what levels they should be maintained.

Because of the long lead times associated with the development of Tamiflu, Lapre’s strategy needs to maintain the flexibility that he had just spent 2006 developing as well as implement better communication among key stakeholders to avoid shortfalls should a pandemic occur.

Evaluation of Factors Involved:

As of 2007, Roche had fulfilled all orders that foreign governments had requested

Historically, flu pandemics were considered deadly. Exhibit 1 shows the enormity of the death toll from the Spanish influenza pandemic in the early 20th century had generated public outcry about unpreparedness by public health officials that resulted in the modern day equivalent of between 175 and 350 million deaths. Currently Roche estimated that the world governments would be able to dose roughly 5% of the world population in the case of a pandemic, which, based on Exhibit 3 (below), is not sufficient to prevent significant death.

Using an aggregate planning approach