Production Planning for Pharmaceutical Companies Under Non-Compliance Risk

摘要

This paper addresses a production planning setting for pharmaceutical companies under the risk of failing quality inspections that are undertaken by the regulatory authorities to ensure good manufacturing practices. A staged decision model is proposed where the regulatory authority is considered an adversary with limited inspection budget, and the chosen inspections themselves have uncertain outcomes. Compact formulations for the expected revenue and the worst-case revenue as risk measures are given as well as a proof that the simplest version of the production planning problem under uncertainty is NP-complete. Some computational results are given to demonstrate the performance of the different formulations.