By Jamie Cartwright
The COVID-19 outbreak has forced the pharmaceutical industry to reevaluate every aspect of the industry from manufacturing pharmaceuticals to the drug supply chains. As supplies dwindle and drug shortages become acute, the drug industry is increasingly witnessing an upheaval in the medical supply chains that could have serious repercussions. With the demand for a coronavirus vaccine intensifying, many countries see pharmaceutical science more and more as a matter of national security.
Dr. Frederick Sancilio is a pharmaceutical research scientist and entrepreneur. He founded several biotechnology companies over the past 40 years of his career. He is currently a research professor at Florida Atlantic University. Based in Vancouver, BC, he also serves as president and board member of Alpha Cognition, Inc., a Canadian biotechnology company developing therapeutics to treat Alzheimer’s disease.
The Pharmaceutical Industry at a Glance
According to Fred Sancilio, there are too many moving parts in the pharmaceutical industry. While the drug supply chains are crucial, he explains, they are by no means the only components of this vast industry. From acquiring raw materials to manufacturing and packaging the drugs, and finally shipping them to consumers worldwide, there’s a lot that could go wrong and disruptions could have an impact on millions of lives.
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The term raw materials in the pharmaceutical industry is a little misleading. Rather than naturally occurring materials, these are usually building blocks that go into the manufacturing of active pharmaceutical ingredients (APIs). Most of these building blocks are extracted or synthesized in other countries and need to be shipped to the pharmaceutical company. Sometimes bulk products are manufactured in different countries and then delivered to their respective markets. Even packaging can take place in yet a different part of the world. In other words, every stage of the drug manufacturing process involves supply chains.
Distribution Disruptions Under COVID-19
Once the medical product has been manufactured, packaged, and labeled, it’s time for distribution. According to Fred Sancilio, this is one of the biggest hurdles that the medical supply chains face. This includes short-term shortages as a result of lockdowns. When drug plants had to shut down even temporarily, there were delays and even the cancelation of drug deliveries on a global scale.
But, it’s not just the lockdowns to prevent the spread of COVID-19 that had led to drug shipment delays. Border restrictions are another factor that played havoc with the drug supply chain. With so many international flights canceled, air cargo almost came to a standstill. It didn’t help that many parts of the world became pandemic hotspots, which increased the demand for medical supplies. And while some of these shortages were the result of bad inventory, in many cases, it was trade restrictions and disruptions in the medical supply chains that had exacerbated the problem.
Risks and Delays on the Operational Level
The way Fred Sancilio sees it, there are other risks on the operational level that could have a huge impact on the pharmaceutical industry. Some of these risks have to do with production limits, plant capacity, and shipping constraints. And they are all impacted by COVID-19. From reduced staff shifts to imposed quarantines or the stepping up of health inspections, many plants have seen a big decrease in production.
In addition to all of these delays, certain parts of the drug supply chains are seeing more shortages than others. The cold chain storage, for example, is one of those parts whose capacity needs to be upgraded to meet the increased demand for the upcoming coronavirus vaccines. Not to mention that with the focus on developing new vaccines, other aspects of pharmaceutical science might have to take a back seat as well. This could have a long-term impact on new drug introductions and developments that have little to do with COVID-19.
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What the pandemic has revealed was that trade policies were so fragile, they posed a risk to the global response to COVID-19. One of the first steps many governments took was to close borders in the early stages of the pandemic. This was justified then as a necessary step to protect national security. “What worries me,” explains Frederick Sancilio, “is that this could lead to more serious restrictions on the movement of people and products. And by-products, I mean critical medical supplies.”
If countries let populist sentiments run rampant, changes in policies could result in limiting offshore research and restricting cooperation between pharmaceutical scientists across the globe. This could have devastating effects not just on drug supply but on the pharmaceutical industry as a whole. For example, a slight change in trade policies could put the operations of a pharmaceutical company that relies on a certain supplier from a different country at risk.
This all creates the need for what Frederick Sancilio calls a resilient medical supply chain. And it’s not just international relations and geopolitical factors that impact that supply chain. It’s also some internal issues that COVID-19 has created and brought to light. One of those issues has to do with the heightened inspections of imported goods and supplies.
The pandemic has made it imperative that all imported shipments go through rigorous health checks. This can cause delays in shipment deliveries, which also impacts the pharmaceutical industry and drug manufacturing companies. It also impacts patients who need their drugs delivered to them and might put their health and very lives at risk.
Fred Sancilio on COVID-19 and the Pharma Industry
One of the questions the pharma industry is grappling with has to do with supplies. According to Frederick Sancilio, those companies that only have one international supplier are at the mercy of shifts in trade policies more than those who have diverse suppliers in different countries.
This is why many companies are evaluating their current supply chains to identify any vulnerable links or soft spots that could fail under the strain of high demand or a similar catastrophe. In the pharmaceutical world, capacity redundancy is more than a buzzword. It holds the key to the survival of many drug companies and the health and wellbeing of millions of people worldwide.
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