How Pharma Companies Can Deal with the New COVID Wave
- A highly infectious, rapidly spreading coronavirus variant in China has sent shockwaves across the world.
- As authorities issue health advisories, pharma companies are preparing for a repeat of supply chain issues.
- This is perhaps the best time for pharma companies to make the best use of supply chain technology.
December 30, 2022 | Supply Chain Strategy
The COVID-19 pandemic is by no means over.
In fact, there is a new wave of infections in China after it disbanded its zero-COVID policy.
While it’s hard to get official data, reports suggest the country is witnessing about a million cases of a new coronavirus variant every 24 hours. There are chaotic scenes at hospitals in several cities and the medical infrastructure has crumbled under pressure.
As China continues to grapple with alarmingly high cases of the new variant, there are concerns of a sudden rise in cases in India, Japan and other Asian countries. And this has got the U.S. and the other western countries worried.
Impact of the New Wave on Pharma
The latest pandemic scare is likely to deal another blow to pharma companies, many of whom haven’t recovered fully from the earlier supply chain disruptions. It can further widen the gaps in real-time visibility and collaboration that hamper their supply chain operations.
If the current wave lasts for an extended period, it will impact the supply of active pharmaceutical ingredients (API) and components.
APIs of key medicines such as paracetamol have suddenly become costlier amid likely supply disruptions. Regular cold medicines such as levocetirizine are also seeing a shortage.
The new wave is also a wake-up call for pharma companies that discontinued the production of new vaccines, either due to low take-up of booster jabs or expiry of vaccines produced earlier.
Serum Institute of India, for example, halted the production of its Covishield vaccine in December 2021. A significant portion of the manufacturer’s stock had reportedly expired by that time.
The lack of vaccines is likely to pose a fresh challenge amid a sudden scramble to get vaccinated with the booster dose.
As things stand right now, stakeholders of pharma supply chains are extremely concerned, given the lack of medicines, hospital beds as well as medical staff.
What Can Pharma Companies Do
Here are three immediate next steps for pharma companies:
1. Map the supply chain
As a first step, pharma companies must begin to look beyond their tier 1 suppliers. They need to map their entire supply chain from start to end. Mapping can help them identify weak and vulnerable points of their supply chain. It can also help them identify their suppliers’ suppliers and understand their concerns.
2. Leverage technology
Digital transformation has become a business necessity for the pharma sector. This is especially vital for pharma companies that continue to rely on time-consuming manual processes for managing their supply chains. Advanced supply chain technology can automate most of these processes and enable human workforce to focus on strategic tasks.
Technology can provide end-to-end visibility of the supply chain. It can also transform decision-making as companies access data in real time. Additionally, it enables companies to sense changes in demand and make quick adjustments.
3. Maintain optimum inventory
This is the time for pharma companies to prepare for an emergency. They can no longer rely on a just-in-time inventory scheme. Instead, they must immediately switch to a just-in-case inventory model and maintain a safety stock. This is particularly crucial for essential medicines and medical supplies.
In addition to these steps, pharma companies can adopt a localization strategy for the long term. With a localized supply chain, they can safeguard supplies, build local capabilities and achieve the much-needed resiliency.
The Bottom Line
As pharma companies prepare for a possibly new outbreak of the pandemic, they look to avoid the mistakes committed in the last two years. However, this is not going to be easy, given their reliance on traditional supply chain processes and reluctance to adopt technology.
In many ways, leveraging supply chain technology can be a game-changing strategy at this time. It can help pharma companies mitigate supply-related risks and streamline supply chain operations. This is the immediate need of the hour.
To learn more about how pharma companies can effectively deal with the ongoing crisis, download this GEP webcast.
Why Pharma Needs to Accelerate Digital Supply Chain Transformation Now
