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Supply Chains reshaping - How to respond to a crisis

“Fear of disease kills more men than disease itself.”
Mahatma Gandhi.

After the COVID-19 pandemic, the medicines supply chains faced another huge challenge due to the crisis in Ukraine. These two crises have caused substantial challenges to medicines supply chains as well as economic losses. Supply chains are critical to European growth so solving any issues that impact them is vital to rebuilding economies after a crisis. A reshaping of supply chains is essential to make them more resilient and future ready.

 

There are many stakeholders involved in medicines supply chains, which are complex. Their design is a long-term undertaking that starts long before the approval of a medicine. Once established, supply chains must be preserved and scaled up to keep up with advances in technology, growing clinical needs and rising environmental standards. Today, products in our hospitals and pharmacies, typically commenced their supply journey up to 2 years ago. However, for biological products, which includes vaccines, the process of manufacturing and distribution can be even more complex. Despite the preparation and planning that goes into this work, delays and shortages can still occur.

There are two extensive categories that can cause this: factors that companies can control, and those that are unforeseen, such as issues around unexpected increase of demand, global crisis, or economic policy. It is safe to say that the COVID-19 outbreak and crisis in Ukraine fit directly under the category of ‘unforeseen events’ and have exposed some of the vulnerabilities in the medicines supply chains in Europe[1]. Therefore, we need to draw the lessons and propose changes in the current legislation to implement a framework that will better respond to a future crisis.

COVID-19 pandemic

Spring 2020 marked the beginning of the COVID-19 pandemic, and whilst fear of this novel virus was spreading like a fire across the global population, fear of extensive shortages of medicines was also portrayed all over the news. The companies reacted by making changes to work practices to ensure the safekeeping of employees while increasing production. The restrictions on export were a major concern and concerned patients who stocked up on the medicines they required.

The element of fear was absolutely predominant back at the time given it was an unknown disease without medicines to treat it, requiring thus companies to respond in such a difficult environment and rise up to the challenge. Indeed, manufacturing sites and distribution centers showed that they were actually able to maintain supply. It was a hands-on assessment of global supply chain resilience and robustness in the face of a dramatic surge in patient need and demand, and the majority of the pharmaceutical sector in Europe rose to the occasion. Moreover, some medicines’ supply increased to 800% of the normal volume to answer to the expanding requests for specific treatments. Furthermore, the pharmaceutical industry has been striving for equitable and broad access to advanced COVID-19 vaccines across the world to curb the pandemic. These vaccines were not only developed in record time, based on the decades long research, but delivered in a scale never seen before, supplying more than 12 billion doses[2] globally in less than 18 months1.

Crisis in Ukraine

Whilst it was expected that the medicines supply chain disruption due to the COVID-19 pandemic would reach some kind of stabilization in 2022 and partly 2023, another global crisis, replaced COVID as a major risk for the medicines supply chains: the crisis in Ukraine.

Although this ongoing crisis is more localized, it is generating a similar fear amongst patients with medical need in Ukraine, Russia, neighboring EU Member States and other countries where access to medicines might be impacted. Indeed, the war is creating instabilities in some of the mechanisms of global medicines supply although current situation shows that there are no specific shortage reported nor anticipated in the EU. The demand did increase as a result of refugee movements to neighboring countries of Ukraine in Europe. Nevertheless, manufacturers do not expect any complications in the near future.

In Ukraine, however, there have been major issues with commercial supply chain because of transportation challenges. Companies have had to seek alternatives routes, via humanitarian organization and the Ukrainian Ministry of Health, to be able to provide medicines to match the patients’ need. The companies have also experienced issues in moving the medicines in Ukraine, since warehouses and depots were closed. The deliveries to pharmacies and hospitals were also disrupted but has resumed in some areas. Currently, the delivery of medicines to Ukraine have been restarted wherever is possible and where the infrastructure is intact.

Regarding the supply to international markets like Asia, there have been shortages on specific products for several weeks as well. In general, there are increasing difficulties in the shipment of medicines, since products need to be shipped by road because of flight prohibitions. There is a growing amount of transporters that refuse to ship medicines to Northern Asia, which causes logistic times to be extended. Therefore, additional transportation methods are being considered.

So far, the main priority is to make sure that patients in need of medicines, wherever they are located, have access to medical aid. Thus, companies have responded to urgent product request with donations of various medicines to address the health needs of patients that are affected by the war. Currently, over 22 million doses of essential medicines have been offered as support[3].

Lessons learned and future actions

Looking forward, there are long-term opportunities to learn from and to be better prepared when similar crises would occur again:

  • Introduction of policies by the EU and national governments with the aim to strengthen global supply chains and support the production and free flow of such technologies.
  • Joint procurement procedures should be limited to emergency situations, when the purchase and supply of medical countermeasures cannot be ensured by other means.
  • Infrastructure should be developed in a way that there is capacity to get doses in the lower middle- and low-income countries.
  • Actions should be coordinated at supranational level since companies run global supply chains and these are more likely to ensure continuous supply to all EU countries.
  • Regulatory flexibilities could provide value for tackling future pandemics, and beyond emergency situations, particularly where the EU and Member States have aligned closely to provide a streamlined regulatory environment.
  • EU-level coordination of procurement should guarantee coordination between Member States to fairly allocate initially limited supply quantities in a transparent manner, and the need to prevent issues related to national distribution channels, or the risk of inefficient stockpiling.

In conclusion, EMA and the EU Commission (EC) need to set up a reporting system, with a harmonized definition of a ‘shortage’. The system should collect real time information and ensure a streamlined alert system. The data in the existing European Medicines Verification System could be used for such purpose. The European Centre for Disease Control (ECDC) could also help by releasing epidemiological modelling, patients’ needs and hospital capacity data in the Member States to improve demand forecasting. Finally, special consideration and focus should be provided to a subset of critical medicines for manufacturers and regulators to efficiently cooperate over shortage prevention plans[4]. This is the way forward to ensure a future-proof supply chains process that releases patients from the fear of not have access to medicines wherever and whenever.




[1] https://www.efpia.eu/news-events/the-efpia-view/blog-articles/drug-shortages-lessons-from-the-covid-19-crisis/

[2] https://www.efpia.eu/media/636989/efpia_vaccines-europe_covid-19-lessons-learned_may-2022.pdf

[3] https://www.efpia.eu/news-events/the-efpia-view/efpia-news/pharmaceutical-industry-response-to-the-war-in-ukraine/

[4] https://www.efpia.eu/media/636798/efpia-regulatoryroadtoinnovation_triptych_v07-final-neworder_pbp.pdf

Marco Farinelli

Marco Farinelli is the Chair of the EFPIA Supply Chain Working Group and Drug Shortage Work Stream. He has worked...
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François Lamérant

François Lamérant is Associate Director, Country Support for the Economic & Social Affairs Team at EFPIA.
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