Managing Downstream Traceability to Prevent Grey Market Diversion An Exploratory Case Study of Distribution Control in a Global Medtech Company

Sammanfattning

Grey market diversion, meaning the redistribution of genuine products throughunauthorised channels, represents a growing challenge for medical technologycompanies operating in global multi-tiered distribution networks. This studyinvestigates how downstream traceability solutions and organisational practices canhelp detect and prevent product diversion using an antiseptic product from MölnlyckeHealthcare in the US market as a case.The study adopts an exploratory qualitative approach where semi-structuredinterviews with both internal stakeholders and external industry experts serves as themain data collection method. The findings show that the primary challenge is not theavailability of traceability tools but rather maintaining visibility in complexdistribution networks. Batch-level identification, combined with strong economicincentives in the US market landscape, creates conditions where unauthorised resale isdifficult to prevent.Item-level serialisation emerges as a potential near-term technical solution, enablingtargeted buybacks and deterrence without requiring full supply chain participation.Artificial intelligence could complement this by automating the detection of dataanomalies and patterns in existing systems. Organisational and commercial practicesare equally as important since without clear ownership, cross-functional coordinationand enforcement mandate, enhanced traceability risks becoming an investmentwithout meaningful results. The thesis concludes that downstream traceability shouldbe understood as a strategic capability rather than just an operational tool, requiringengagement from all parts of an organisation.