The disruptions to workforce activity and travel occasioned by COVID-19 threw a spotlight onto risks in global supply chains in 2020. Industry leaders forecast changes such as a trend towards local manufacturing as a result. With the advent of vaccines and therapeutics for the coronavirus, urgently needed by the world’s population, the need for a huge manufacturing ramp-up also heaped pressure on industrial capacity.
Meanwhile, the rapid maturation of various advanced therapies, such as CAR-T cell therapy and gene therapy, is creating additional demand for new types of manufacturing and distribution capability and capacity.
Ronald Piervincenzi, CEO of USP (US Pharmacopeia), the non-profit organization that develops standards to strengthen the global supply chain for medicines and supplements, thought that "the focus, as well as practical effort and supplies, on COVID-19 vaccines and therapies will overshadow and exacerbate the production and delivery of other key vaccines and therapeutics from infectious to rare diseases."
He warned, "The competition for raw materials, reagents, other disposables and facilities for manufacturing and testing of biologics could threaten the supply of quality biologics broadly. I believe this challenge is both temporary and necessary – but one that requires awareness and agility."
Mahesh Veerina, CEO of Cloudleaf, which provides digital tracking services for pharma supply chains, shared these concerns. “The operation to deliver a COVID-19 vaccine will put enormous pressure on the supply chain to share resources with other products that demand cold chain transit, including flu vaccines, cancer treatments, and genomics and precision medicine. The industry will make an unparalleled collaborative effort to communicate and share resources. New capabilities for tracking their assets such as palettes and temperature-controlled transport and storage devices will be the underpinning for this success.”
Tackling this challenge will have wider benefits, in Veerina’s view. “The work done in the cold chain for COVID-19 has put the industry 16-18 months ahead of schedule on digital transformation. In the long term, the supply chain practices adopted in response to the pandemic will position companies to avoid costs associated with lost or damaged products – a critical capability as the future of medicine points toward smaller batches of more personalized, higher value medicines, many of which will require cold chain transit.”
Meanwhile, Rajiv Khosla, CEO of contract development and manufacturing organization Enteris BioPharma Inc., noted, "The COVID-19 pandemic magnified how vulnerable the pharmaceutical industry is to global supply chain issues, specifically the heavy reliance on ex-US markets for key starting materials, intermediates and APIs needed to produce drugs, as well as the actual manufacturing of medications prescribed to millions of Americans. These are not new concerns, but the disruption brought on by COVID-19 has highlighted the need to return more of the manufacturing and supply chain to the US. Given these dynamics, we expect to see a sharp growth in demand for US-based CDMOs with the ability to handle complex manufacturing needs for specialty pharmaceutical and biotechnology companies."
Veerina also expected more localization of manufacturing. “Increased regionalized production of active pharmaceutical ingredients will catalyze a long-term policy shift throughout the global supply chain,” he said. “As a result of the drug shortages and stockpiling witnessed at the start of the COVID-19 pandemic, combined with global political tensions, pharmaceutical manufacturers will look to partner with local, near-shore active pharmaceutical ingredient (API) suppliers. This in turn will ensure that pharmaceutical products can be produced in the event of another global crisis -- eliminating the possibility of drug shortages. In 2021, the near-shore regionalization of APIs will cause a long-term policy shift throughout the global supply chain, fueling changes in supply chain behavior such as the creation of a larger, connected ecosystem within the supply chain. This ecosystem will result in the building of new partnerships between not only drug manufacturers and API suppliers, but also logistics providers, vendors and other organizations throughout the supply chain. As supply chain entities work to quickly form these new partnerships, the element of ’blind trust’ between long-time business partners will no longer be a factor and organizations will look to adopt new solutions that provide real-time visibility into a product’s location -- reassuring both parties that each other is on track.”
Dave Lennon, president, Novartis Gene Therapies, drew attention to the production of advanced therapies. “We will start to see the investments in manufacturing buildouts come to fruition with next generation engineering advances improving the industry’s capacity to reach patients and deliver on the promise of gene therapy,” he predicted.
Jennifer Buell, president and chief operating officer of immuno-oncology developer Agenus Inc., noted that “Manufacturing and supply chain independence will be critical. Production space is at a premium and independence here will be coveted.” Her company, which manufactures both antibodies and autologous and personalized cancer vaccines, has been expanding its own production capacity.
For more predictive content, visit our Outlook 2021 pages: invivo.pharmaintelligence. informa.com/outlook