A mathematical model for coordinating corporate social responsibility and order quantity in pharmaceutical supply chain

Abstract

In this study, a collaboration model is proposed to determine the optimal order quantity and the corporate social responsibility (CSR) investment in a two-stage pharmaceutical supply chain. The supplier, which is socially concerned, invests to improve CSR by implementing the medication take-back program. Furthermore, considering a newsvendor setting, the retailer has to determine its order quantity before each season. Firstly, the members' performance in both centralized and decentralized decision making is investigated and the optimal solutions are derived, then a collaboration model is proposed to determine the optimal order quantity and MTBP investment to maximize the whole SC profit while ensuring both members participate in the scheme

Keywords

• pharmaceutical supply chain
• collaboration model
• corporate social responsibility
• medication take-back
• order quantity