Topic: Will Domestic Production Solve U.S. Medical Supply Woes?
Having the entire stock of U.S. medical supplies manufactured in the U.S. isn’t really feasible, speakers on a panel said Tuesday.
After studying the matter, “We concluded that wholesale government-mandated reshoring is really the wrong approach,” Meredith Broadbent, MBA, senior adviser at the Center for Strategic and International Studies (CSIS), said at the event, sponsored by the National Press Foundation and funded by the Hinrich Foundation.
“OECD [Organisation for Economic Co-operation and Development] models indicate that wholesale reshoring would not improve resiliency or efficiency of supply, largely due to a lack of diversification and an inability to tap into global networks of suppliers and producers,” Broadbent said.
Willy Shih, PhD, professor of management practice in business administration at Harvard Business School in Boston, gave one example why the supply chain can be complicated. For example, rare earth metals are now mined in Mountain Pass, California, “but the ore has to go to China for processing,” said Shih. “One of the things I think you will find if you probe congressional staff offices in Washington is there is a general lack of understanding of the detail of how these things are actually structured.”
A recent CSIS report — funded by drugmakers Pfizer and Gilead and by the U.S. Chamber of Commerce — called for the U.S. to develop a policy “centered around diversification within a network of trusted supplier companies who would cooperate with the U.S. in order to bolster and guarantee a steady supply of essential medical products for future public health crises.”
“A ‘trusted partner’ network would offer member countries enhanced commercial ties; reciprocal reduction of trade barriers, investment, and other regulatory barriers; and a commitment of support from other trusted partner countries, especially during public health crises,” Broadbent said. “Eligibility criteria for trusted partner status could include commitments to safety and efficacy of medical products, IP [intellectual property] protection, and free data flows.”
Fiona Miller, PhD, director of the Centre for Sustainable Health Systems at the University of Toronto, said when it comes to supply chains, “we’re dealing with a very old problem; COVID-19 made it very difficult for us to ignore longstanding problems and has made some of them more acute.” Even though the problems aren’t new, some of the solutions are, she added.
Critical healthcare supplies could be interrupted in several ways, she said. Products may not be manufactured, such as in 2017 when hurricanes in Puerto Rico caused Baxter to stop making sterile saline for the U.S. market, “or you may have limited numbers of manufacturers, so that when one goes down or one goes out of business you have a critical shortage — that’s what happened with propofol about 10 years ago, which is a critical input into anesthetic practices,” said Miller.
Or raw materials could be lacking, she said. This has happened a lot during the pandemic — for instance, the non-woven variety of polypropylene needed for masks and respirators; “we don’t even have the machines to make that material,” Miller said. “These can all mean the products can’t be made in sufficient supply.”
Topic Discussed: Will Domestic Production Solve U.S. Medical Supply Woes?