ARMONK, NY — Pharmaceutical distributor McKesson Corporation is using a new IBM program to look at where it can cut emissions and reduce costs in its supply chain.

McKesson (NYSE: MCK) supplies and transports one-third of prescription drugs used in North America, and its supply chain reaches more than 40,000 hospitals, local and chain pharmacies, and other locations.

It's started using the Supply Chain Sustainability Management Solution from IBM (NYSE: IBM) to create scenarios that can help make decisions to increase the efficiency and lower the impact of its operations.

The solution, developed jointly with IBM Global Business Services and IBM Research, draws on a company's supply chain, sales and geographic data to compare various situation.

McKesson could, for example, use it to look at the differences between keeping at refrigerated drugs like insulin and vaccines in one central facility or spread out in various facilities. It can also compare transporting products from vendors to local warehouses or first through central warehouses, recommending which action has the minimal environmental impact with better efficiency.

The solution also can take into account what effect solar panels on warehouses will have, as well as alternative fuels in vehicles, along with all energy use at warehouses from how long the warehouses operate in a day to how much energy their fork lifts consume.

IBM's work with McKesson is an extension of its Smarter Planet initiative, aimed at improving everything from buildings and energy to traffic and water. The program has so far included servers designed to work in the smart grid, a "data center of tomorrow," and more intelligent buildings.

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