How do companies help safeguard the supply and quality of their products?
The achievement of the Sustainable Development Goals by 2030 brings a new sense of urgency to the challenges and inefficiencies posed by complex supply chains. Pharmaceutical companies have a crucial role to play in safeguarding the supply of high-quality medicines globally, especially in hard-to-reach populations where health systems may be weak. Access to such products is key in achieving Universal Health Coverage.
Which companies are taking steps to secure the supply of products in low- and middle income countries?
The 2021 Index finds that 19 companies disclose at least one measure to ensure continuous supply in at least one country in scope. Bristol Myers Squibb did not disclose details to the Index and information was not available in the public domain. The 19 companies report working in some form of a partnership to address supply challenges: e.g. collaborating with supranational partners to supply medicine, liaising with governments and purchasers on demand forecasting and working with local distributors to tackle supply barriers. However, these measures are applied to only a few products and only in a few countries, thus not addressing the scale of the access challenge.
During the period of analysis, eight companies, namely AstraZeneca, Bayer, GSK, Johnson & Johnson, Merck*, Novo Nordisk, Novartis and Pfizer reportedly took measures in response to/in anticipation of the supply disruptions in low- and middle-income countries caused by COVID-19. Such disruptions included reduced air freight capacity and border closures. Measures involved, among others, closer collaboration with local distributors, re-allocating stock to local distribution centres, increasing safety socks, increasing API stocks and assessing alternative innovative supply methods and routes. These practices are a crucial step in preparing for the next potential pandemic.
Preventing poor-quality medicines from reaching pharmacy shelves
Many low- and middle-income countries have a long and complex product distribution chain. As a result, product diversion or the introduction of expired, substandard and falsified products into the distribution chain becomes relatively easy. 1 in 10 products circulating in low- and middle-income countries are substandard or falsified**. Pharmaceutical companies can help combat the issue of substandard and falsified products by reporting identified cases to the national health authorities and/or WHO Rapid Alert in a timely manner, thus enabling prompter action.
Six companies lead: Astellas, AstraZeneca, Eisai, GSK, Novartis and Takeda, by having a policy to report cases in less than ten days and demonstrating strong approaches (including visual inspection e.g. confirmation of mislabelling, or packaging data verification) to allow faster action to withdraw the product from the market, thus meeting all stakeholder expectations.
Capacity building activities can help increase the availability of quality-assured, safe and effective medicine and healthcare.
Looking beyond the product to help build resilient supply chains in low- and middle-income countries
For many low- and middle-income countries with limited resources, the infrastructure required for the proper procurement, delivery, logistics and storage of medicine is often lacking. Large pharmaceutical companies typically have both the know-how and strategic incentives to help fill these gaps. Drawing on their vast expertise, pharmaceutical companies can engage with local stakeholders with a view to strengthening supply practices. They can also support local manufacturing by transferring their knowledge and expertise to local manufacturers in these countries. Such capacity building activities can help increase the availability of quality-assured, safe and effective medicine and healthcare. These initiatives need to be held to high standards to ensure the related activities are both responsible and impactful.
- Takes place during the period of analysis and in a country in scope of the Index
- Is in partnership with a local third-party actor
- Addresses specific local needs and/or gaps.
The Index assessed whether the initiatives are guided by clear, measurable goals or objectives, measure outcomes and have long-term aims/achieve integration within the system. These are known as Good Practice Standards (GPS)
Focus of companies’ initiatives for strengthening manufacturing and supply capacity
The Index analysed 60 manufacturing initiatives. 20 of them meet all Good Practice Standards and 20 meet some of them. Through technology transfers (25 of 42), an originator company transfers technology and knowledge on a specific drug development process to a manufacturing site in countries in scope of the Index.
The Index assessed a total of 68 supply chain initiatives, of which 28 meet all Good Practice Standards and 18 meet some of them. Providing support to local distributors includes training on Good Distribution Practices, sustainable practices and cold chain supply
Case Studies: How companies can help ensure the continuous supply of their products
For the distribution of diethylcarbamazine (DEC) Eisai uses the NTDeliver system to estimate the volume of supply per country and to track and share distribution information with WHO and other pharmaceutical companies.
Bayer and MSD*** participate in the Global Family Planning Visibility and Analytics Network (VAN) of the Reproductive Health Supplies Coalition, which captures data from multiple sources along the supply chain to improve supply chain visibility, offering a platform to assess supply needs and enhance time and cost-effective supply. Currently, a pilot is ongoing in Nigeria and Malawi.
Sufficient safety stocks of APIs and/or finished products prevent stockouts. Merck reports keeping a safety stock of finished goods (between 1 and 3 months) in all their distribution centres as well as inventory of semi-finished products and a strategic stock of API. Gilead holds a safety stock of unlabelled bottles to fill gaps in supply. Boehringer Ingelheim reports stockpiling of the API empagliflozin (for Jardiance®, Synjardy® and Glyxambi®) with 8 months coverage.
Opportunity for companies to expand efforts and strengthen last-mile supplyWith the majority of the manufacturing capacity building initiatives concentrated in just three countries, companies are encouraged to expand their activity to sub-Saharan Africa where there is, in general, a less established manufacturing infrastructure in place. A total of eight initiatives took place in Sub-Saharan Africa, of which the majority took place in South Africa (5), followed by Kenya (2) and Nigeria (1).
While manufacturing initiatives are concentrated in China, India and Brazil, supply chain capacity building initiatives are not concentrated in the same geographic areas.
Moreover, a relatively large proportion of the supply chain capacity building initiatives are taking place in sub-Saharan Africa. Companies are encouraged to make provisions for both the quality of products and the availability by supporting supply chain skills and knowledge to ensure agile and strong supply chains in low- and middle-income countries, including the prevention of substandard and falsified products.
* Merck KGaA (Darmstadt, Germany)
** World Health Organization. Substandard and falsified medical products. https://www.who.int/news-room/fact-sheets/detail/substandard-and-falsified-medical-products. Accessed December 23, 2020.
*** Merck & Co, Inc (Kenilworth, NJ USA)