Mega Pharma

Leading Pharmaceutical Company Streamlines Operational Processes and Cuts IT Costs

Laboratorios Roemmers del Uruguay is a leading Latin American pharmaceutical company and a member of Mega Pharma alliance. Historically, the company used SAP technology for business management, but it could no longer meet requirements for new development initiatives. To address this issue, and reduce overall operating costs, the company, working with Columbus IT Andino, rolled out Microsoft® Dynamics™ AX. Using this technology, it has developed a number of new, value-added applications that enhance budgeting, calculate actual costs, and ensure industry-leading quality control for products. The new solution has reduced hardware and software maintenance and licensing costs by 70 per cent. In addition, it has enhanced management decision making, streamlined operational processes, and paved the way for rapid growth in the future.

Situation

Founded in 1961, Laboratorios Roemmers del Uruguay is now a leading Latin American pharmaceutical company with 330 employees. Since 2001 it has been part of a strategic partnership with 15 other laboratories across Latin America. By working together, these companies, known collectively as the Mega Pharma alliance, enjoy greatly enhanced opportunities for exporting medicine. As a result, 80 per cent of medicine produced in the two Laboratorios Roemmers del Uruguay factories now reaches foreign markets.

When the Mega Pharma alliance was created, it chose to support its shared business activities and desktop productivity applications with Microsoft® technologies. In addition, the alliance began the search for a new, standardized business management solution to increase the efficiency of inter-company operations.

Historically, Laboratorios Roemmers del Uruguay used SAP applications to manage its business processes. Dario Noguera, IT Manager, Mega Pharma, says: “Each new report we created in SAP required us to develop entirely new functionality. This was a complex and expensive task and we decided to deploy new technologies with the aim of reducing overall operational costs.”

Jorge Tomasi, General Manager, Laboratorios Roemmers del Uruguay, says: “Recently, Latin America has experienced significant economic challenges. That means we must continue to operate extremely effectively while preparing for rapid growth in the future.”

Solution

After an in-depth evaluation of available business management technologies, Laboratorios Roemmers del Uruguay decided to roll out Microsoft Dynamics™ AX. It based its decision on the potential for integration with the company's existing Microsoft infrastructure. In January 2006, Microsoft Dynamics AX was deployed with support from Microsoft Certified Partner Columbus IT Partner Andino. Noguera says: “From day one, we identified a number of functional and technological benefits associated with Microsoft Dynamics AX. Total cost of ownership was also significantly lower than competing technologies.”

Gustavo Noceda, IT Manager, Laboratorios Roemmers del Uruguay, says: “With Microsoft Dynamics AX, we have minimized our consulting, support, and maintenance costs. At the same time, we have enhanced operations across all areas of the business by increasing control over our management functions.

“Today, 200 employees support our commercial processes—from customer ordering to inventory control and logistics—using Microsoft Dynamics AX. We use the system to effectively process 5,000 purchase orders from local markets each month and to streamline the management of billing worth U.S.$38.5 million per year. As a result, we have significantly enhanced our operational efficiency and achieved a rapid return on our technology investment.”

Noguera says: “Microsoft Dynamics AX gives us a complete and flexible platform for enhancing the management and operation of our business. It is technologically superior to our previous systems and able to deliver a much more efficient cost-benefit equation.”

Microsoft Dynamics AX Supports New Development Projects

The new infrastructure provides innovative development tools. These have helped Laboratorios Roemmers del Uruguay to create a range of new, value-added application functionalities during a 20,000-hour development initiative. Examples of development projects supported by Microsoft Dynamics AX include:

• Integral Budget application, which streamlines the process of ordering and purchasing raw materials from Uruguay and other countries. Each department enters estimated expenses in the system and an accurate accounting budget is created centrally.
• Standard Cost and Replacement application, which is used to calculate the cost of products and the investment required to replenish items from the inventory every month. This tool helps Laboratorios Roemmers del Uruguay control the actual cost of products and maximize income-yield capacity.
• Quality Control application, which supports the creation and handling of inspection plans. These define qualitative or quantitative analysis of products and allow Laboratorios Roemmers del Uruguay to provide quality certification for its products and processes.

Peter Chalem, Consulting Services and Technology Manager, Columbus IT, says: “Microsoft Dynamics AX offers much better development tools than competing systems. The development projects we have undertaken with the technology would have taken at least three times longer using other software.”

Benefits

Using Microsoft Dynamics AX, Laboratorios Roemmers del Uruguay has increased the efficiency of financial and supply chain processes. In addition, the technology has streamlined logistics, production, planning, resources management, shop-floor control, data management, human resources, project management, corporate accounting, security, and business analysis.

License and Maintenance Costs Reduced by 70 Per Cent

Microsoft Dynamics AX has delivered significant savings in terms of hardware and software maintenance and licensing. Noceda says: “Using the new system, we have achieved savings of 70 per cent over our previous SAP solution.”

Enhanced Management Decision Making

With Microsoft Dynamics AX, Laboratorios Roemmers del Uruguay has achieved greater visibility of its business processes and activities. Tomasi says: “We now have much more information related to how the company is operating and we can see the performance of each operational area in real time. As a result, we have improved the decision-making process and our overall competitive advantage.”

Streamlined Operational Processes

Microsoft Dynamics AX has supported the standardization of business processes at Laboratorios Roemmers del Uruguay. Noceda says: “Standardization has improved our operational efficiency remarkably. It also helps us to prepare for the growth in sales that we have predicted for the next two years.”

Familiar Interface Boosts Employee Productivity

Microsoft Dynamics AX is integrated with Microsoft Windows Server® 2003, Microsoft Exchange Server 2003, Microsoft Windows XP®, and the Microsoft Office System suite of desktop productivity applications. As a result, it offers users a familiar interface, boosting productivity and reducing training costs. 

Fast, Low-Impact Deployment

Microsoft Dynamics AX was deployed in January 2006 with support from Microsoft Certified Partner Columbus IT Partner Andino. Noceda says: “Two days after we rolled out the new technology in our production environment, we could generate bills, receipts, and production orders across the entire company. This low impact implementation ensured minimal disruption to our day-to-day processes and enabled us to enjoy the benefits of the technology from day one.”

Deployment Demonstrates Industry Leadership

Many other companies in the Mega Pharma alliance are planning to deploy Microsoft Dynamics AX having seen the successful deployment of the technology at Laboratorios Roemmers del Uruguay. Noguera says: “We are the first pharmaceutical company to roll out Microsoft Dynamics AX in Latin America and we are proud of our accomplishment. In view of the benefits delivered by the technology, we expect other companies from the Mega Pharma alliance to follow in our footsteps.”

Learn more about the project in attached video(31 MB).