August 23, 2022 | Supply Chain Strategy
With over 42,000 cases worldwide, the World Health Organization has recognized monkeypox as a public health emergency.
Complicating the efforts to curb the spread is the fact that only one manufacturer, Bavarian Nordic, has an approved vaccine called Jynneos for it.
In response, the Danish biotech firm has pledged to ramp up production to meet the demand for the vaccine.
There is little danger that monkeypox will spread into a pandemic the way COVID-19 did. At the same time, the need to contain the epidemic underscores the critical importance of supplier diversification in the life sciences sector.
While Bavarian Nordic has said it can meet the demand for its vaccine, having only one supplier for a vaccine increases the risk of a disruption that could allow for further spread of an epidemic.
Likewise, having a narrow or geographically concentrated supply network increases the risk of disruption for a manufacturer. Companies must have a resilient supply chain that is ready to handle the challenges of sourcing, production and distribution.
To make sure your enterprise has the right suppliers in place to mitigate disruptions, start by gaining visibility into multiple tiers of suppliers.
When it comes to reducing the critical points of failure in a supply network, visibility into tier-2 suppliers is an important capability. Companies in the life sciences industry that may be sourcing raw materials from a group of suppliers that is concentrated in one region may be exposing themselves to higher levels of risk.
Gaining visibility into tier-2 suppliers is a step toward developing a more geographically diverse group of suppliers for raw materials.
For instance, during the early stages of the COVID-19 pandemic, companies with tier-2 suppliers in affected regions had to find a way to mitigate disruptions or stop production altogether. As a result, countries such as Mexico, Brazil and India emerged as options for supplier diversification.
In addition to improving resilience to supply risks, having visibility into Tier 2 suppliers can help life sciences companies understand their exposure to Scope 3 emissions from their supply chains and meet ESG goals and regulations on supply chain transparency. By investing in modern IT infrastructure, firms can get real-time visibility into inventory levels and production schedules to enhance planning and respond to disruptions on the fly.
Life sciences enterprises should work with their technology partners who can help them analyze their strategy and make sure their supply chain model is designed with a more disruptive business environment in mind.
By leveraging modern platforms and best practices, enterprises can boost visibility and guard against risks arising from a geographically concentrated supply base. In order to mitigate disruptions on life sciences companies, supplier diversification is critical, and visibility is just the first factor for companies to think about.
To learn more, download GEP’s bulletin, The Path to Supplier Diversification: Six Key Considerations for Life Science Companies, available on our Knowledge Bank.