How Pharmanovia Realizes Benefits with ESG, Lower Emissions

Pharmanovia closely monitors its operations and supply chain operations — all to observe Pharmonovia ESG steps that its participants incorporate into their daily management and processes. It conducts a thorough quality audit and extensive due diligence process before engaging with any partner to monitor their ESG and sustainability credentials.

Pharmanovia is on a mission to improve patient healthcare through proven medicines. Using digital platforms, the UK-based pharmaceutical company allows developers to take their products to market through licensing and revitalizing well-established treatments. Its objective is to expand market access to essential products across the world.

“This way, we are already factoring in both upstream and downstream carbon emissions as part of our net carbon calculation, so we can set out clear and ambitious ESG-focused objectives,” says Neeshe Williams, general counsel at Pharmanovia, in a discussion with Environment+Energy Leader. 

Tell us about your sustainability report? 

All employees at Pharmanovia are required to set ESG targets — something on which they are evaluated. The goal is to ingrain these values across company units. The goal is to brand the organization as environmentally aware — a company that actively oversees emissions results and packaging. How?

The head of ESG & Compliance reports directly to the executive management, and ESG is a standing agenda item at all meetings. Moreover, the company has created an ESG committee that is responsible for implementing an annual action plan and appointed ESG ambassadors within all business functions to help drive our strategy and ensure we continue improving and achieving targets. 

“We have set out specific targets, committing to reducing our carbon emissions while increasing the use of recycled materials in all our products,” says Williams. “Successfully incorporating ESG factors and reaching net-zero will require commitment across the breadth of the organization, as well as collaboration across the wider pharmaceutical industry. This is something that has not been traditionally prioritized. As emphasized by the Covid-19 pandemic, the quality, manufacturing, trialing, and transportation of essential medicines has historically been, and remains, paramount.” 

One of the problems that Pharmanovia has run into is the “additional cost associated with ESG criteria.” That could have an impact on the pricing of medicines. But it is trying to overcome this issue by effectively managing licensing and acquisition, determining the most suitable formula and dosage of essential trusted and novel medicines, and harnessing data through technological innovation to improve global access to drugs while considering ESG factors.

What solutions has Pharmanovia already implemented within business operations, functions, and processes to incorporate ESG factors? 

The best way to describe it is by using the adage of what gets measured gets managed: it has a scorecard that collects data across business segments. It also has a “compliance platform” that requires all employees to read, attest, and complete knowledge assessments to confirm their understanding of compliance policies specific to each employee’s responsibilities.

Most businesses are aware that the US Securities and Exchange Commission has a proposal that would have companies tell investors about their CO2 emissions and how much energy they consume. It would also require them to monitor the emissions of those within their supply chains — a more complicated task. To that end, Pharmanovia is ahead of the game: it will be collecting its partners’ carbon data through its ESG platform. 

“The packaging of medicines is highly regulated. We have begun assessing the use of recycled materials in our secondary packaging,” says Williams. 

In 2021, the company sold more than 14.6 million packets of medicine, and it has the data for just under half of its products. Of that, 15% of its products were secondary packed with components made from fully recycled materials, and 12% were packed with at least one feature made from fully recycled material. “We are working with our suppliers to improve our data set and plan to set targets for the use of recycled materials in 2023/24.”

This year, it will be launching Know Your Business Partner — a policy and program to incorporate supply chain audits. These processes will fully integrate ESG factors into all internal and external business operations and functions.

What are the Pharmonovia ESG Results? 

After calculating the existing emissions, Williams says that it found the biggest culprit to be the transport of products via air freight. By switching to sea freight when feasible, it has reduced its carbon footprint. 

“Payback from effective implementation of ESG measures can be difficult to quantify initially; however, we have already made considerable progress in reducing our carbon emissions within the transportation of our products through a 443% increase in the use of sea freight over air freight,” says Williams. 

Costs will fall. As more industries expand their ESG practices, the enabling technologies will gain economies of scale. It’s more than a financial benefit. It also improves brand — an intangible value that Pharmanovia is now realizing.