Pharmaceutical procurement benchmarks for 2027 show median purchase order (PO) coverage of 80.2%, payment terms of 55.9 days and supplier spend equivalent to 51.5% of revenue. The findings point to opportunities in purchasing compliance, working capital, and supplier price management.
These insights come from Sievo's State of Spend 2027: Pharmaceuticals, based on $55.5 billion in anonymized procurement spend from Q3 2025 to Q2 2026.
Key pharmaceutical procurement benchmarks for 2027
The report highlights several findings for pharmaceutical procurement leaders:
| Procurement KPI |
Pharmaceutical median |
| PO coverage |
80.2% |
| Payment terms |
55.9 days |
| Due-to-pay |
+2 days |
| Supplier spend / revenue |
51.5% |
Source: Sievo, State of Spend 2027: Pharmaceuticals, page 8. The data covers Q3 2025–Q2 2026. Figures are medians, not averages.
Median payment terms increased by 2.5 days compared with the previous reporting period, while supplier spend as a share of revenue rose by 2.8 percentage points.
These figures provide a starting point for benchmarking. The complete report also compares top, median and bottom performers to show where pharmaceutical procurement practices diverge.
How does pharmaceutical PO coverage compare across spend categories?
PO coverage varies significantly across pharmaceutical procurement categories
Packaging achieves the highest median PO coverage at 98.4%, while Indirect procurement has a median of 70.7%.
This difference suggests that purchasing processes are more consistently formalized in some spend categories than others.
For procurement organizations, lower PO coverage can prompt an investigation into purchasing exceptions, non-PO invoices and transactions outside approved procurement processes.
Sievo's guide to reducing maverick spend explores how organizations can identify purchasing outside established processes.
What this means for 2027
Indirect purchasing compliance is worth examining as pharmaceutical companies assess opportunities to improve procurement efficiency.
However, PO coverage alone does not determine procurement performance. Teams should compare their results against pharmaceutical peers before setting improvement priorities.
The full Pharmaceuticals report provides category-level PO coverage comparisons across top, median and bottom performers.
What are typical pharmaceutical supplier payment terms?
Median pharmaceutical supplier payment terms reached 55.9 days, increasing by 2.5 days from the previous period.
Payment terms affect working capital by determining when companies are contractually required to settle supplier invoices.
The report identifies $2.75 billion in modeled working-capital potential across Indirect procurement if bottom-quartile performers achieved top-quartile contractual payment terms.
This represents a hypothetical cash-release scenario, not realized savings.
Longer terms can improve working capital, but supplier pricing, negotiated discounts and supply resilience must also be considered.
For more information, see Sievo's article on working capital optimization through payment terms.
What this means for 2027
Pharmaceutical procurement teams can use peer payment-term benchmarks to identify where negotiations deserve attention.
Rather than applying a uniform policy across suppliers, companies can evaluate opportunities at category and supplier level, considering both working-capital impact and commercial trade-offs.
The full report identifies the categories with the largest modeled opportunities and the differences between top- and bottom-quartile payment terms.
Are pharmaceutical API and packaging prices increasing?
Pharmaceutical supplier prices are moving in different directions depending on the material and sourcing region.
According to Sievo's transaction-based price indexes, the overall Active Pharmaceutical Ingredients (API) price index declined 6.0% between June 2024 and June 2026.
However, regional API indexes diverged. Some chemicals and packaging materials also experienced price increases over the report's comparison periods.
These differences show why broad inflation measures may be insufficient for evaluating pharmaceutical supplier prices.
Sievo explains how companies can use real transaction data to assess price competitiveness in Price Benchmarking in Procurement: How to Know If Your Pricing Is Actually Competitive.
What this means for 2027
Pharmaceutical procurement teams should consider regional and material-specific price movements when planning sourcing strategies and supplier negotiations.
Comparing contracted supplier prices with relevant transaction-based benchmarks can help reveal pricing differences that internal spend data alone may not explain.
The complete Pharmaceuticals edition includes regional API and chemicals price-index comparisons, along with selected packaging and material-level price trends.
What do supplier concentration trends reveal?
Supplier concentration varies considerably across pharmaceutical procurement categories.
In certain Direct and Packaging categories, a small number of suppliers account for a substantial share of spend.
By contrast, pharmaceutical supplier concentration is below the cross-industry median in 10 of 11 analyzed Indirect categories, based on the proportion of spend allocated to the top 20 suppliers.
Concentrated supplier bases can support strategic relationships but may increase dependency risk. Fragmented supplier bases can provide flexibility while potentially limiting purchasing leverage.
For related considerations, read Sievo's guide to managing supply chain risks and supplier continuity.
What this means for 2027
Supplier concentration should be evaluated alongside sourcing resilience and commercial leverage.
Companies can use pharmaceutical peer benchmarks to investigate whether their supplier portfolio is unusually concentrated or fragmented for a given category.
The full report explores supplier concentration differences across Direct, Packaging and Indirect procurement.
How should pharmaceutical procurement teams prepare for 2027?
The findings suggest several priorities for pharmaceutical procurement planning:
- Benchmark purchasing compliance. Compare PO coverage with pharmaceutical peers and investigate material differences in purchasing processes.
- Evaluate payment-term opportunities. Assess working-capital potential against supplier pricing and contractual considerations.
- Monitor regional supplier prices. Use category-specific benchmarks to understand API, chemicals and packaging price movements.
- Review supplier concentration. Identify categories where consolidation or diversification warrants further investigation.
These are planning implications based on historical procurement data, not predictions of what will occur during 2027.
The most useful benchmarks are those that reflect comparable industries, spend categories, markets and reporting periods.
Sievo Community Data enables procurement teams to connect external peer benchmarks to their own suppliers, materials and purchasing categories.
How are the pharmaceutical procurement benchmarks calculated?
The Pharmaceuticals edition of State of Spend 2027 analyzes $55.5 billion in anonymized, aggregated and cleansed procurement transactions from consenting Sievo customers during Q3 2025–Q2 2026.
The report uses medians and quartiles to compare peer performance. The participating companies are typically large enterprises, and the results do not represent every pharmaceutical company globally.
The 2027 title refers to the report edition. The procurement KPI findings describe historical performance rather than forecasts for calendar year 2027.
The full report explains KPI calculations, category definitions, percentile classifications and methodology limitations.
FAQs
What is the average pharmaceutical PO coverage rate?
The median pharmaceutical PO coverage rate is 80.2% for Q3 2025–Q2 2026. Actual performance varies across Direct, Packaging and Indirect procurement.
What are average pharmaceutical payment terms?
The median is 55.9 days, an increase of 2.5 days from the previous reporting period.
Are pharmaceutical API prices increasing worldwide?
No. The overall API price index declined 6.0% between June 2024 and June 2026, although regional price-index movements differed.
How many industry reports are included in State of Spend 2027?
Sievo's State of Spend 2027 includes ten industry-specific reports, including Pharmaceuticals, Food & Beverage, Chemicals & Materials, MedTech & Healthcare Services and other major industries.
Each edition provides transaction-based procurement benchmarks for companies within that sector.
Explore the complete State of Spend 2027 findings across 10 industries
Pharmaceutical procurement performance is one part of a broader picture.
Sievo's State of Spend 2027 features ten industry-specific reports, giving procurement leaders access to benchmarks built from real supplier transactions across major industries.
Each edition explores:
- Procurement KPI benchmarks and top-performer comparisons
- Supplier payment terms and modeled working-capital opportunities
- Category spend trends and purchasing patterns
- Supplier concentration and sourcing differences
- Price development and procurement performance insights
Whether you're benchmarking Pharmaceuticals or exploring performance in another sector, the State of Spend 2027 series provides industry-specific data to support procurement decisions.
Explore the complete State of Spend 2027 report series — all 10 industry editions
Powered by Sievo Community Data, using anonymized and aggregated enterprise procurement transactions.
