By: Rob Handfield -- Professor of Supply Chain Management, North Carolina State University
22 November, 2020
(Pic Courtesy: NCSU)
As we enter into the early stages of the second wave of COVID-19 cases, hospitals and public health administrators are worried about the new influx of cases that will arrive before the development and deployment of COVID-19 vaccines in 2021.
During this period, we are continuing to experience a shortage of PPE, and multiple healthcare providers, distributors, and Group Purchasing Organizations are struggling to source masks, gowns, and gloves. Simultaneously, shortages of reagents, plastic trays, test kits, and pipettes continue, limiting the needed tests that will enable the safe return to schools and places of work.
One thing we have learned since the early days of the COVID-19 crisis is the importance of advance planning and preparedness. As we look forward with hope to the deployment of a vaccine or vaccines, it is imperative that we consider the possible supply chain issues that could arise, and learn from the mistakes made during the first wave of the pandemic response.
I would like to share some insights into the potential problems that exist in the vaccine supply chain. This information relies on personal observations, discussions, and insights obtained from the media, relying on our deep network of individuals who are actively involved in the pandemic response within both the private and public sector. Supply chains cross both of these sectors, and many of the challenges we envision will occur through the inadequate interface that exists between these two entities.
A framework developed by the Supply Chain Council, the Supply Chain Operating Reference (SCOR) model, has been deployed to classify the major challenges that exist in each area. The new U.S. administration that will be inaugurated in January 2021 has an opportunity to really make a difference here.
The CDC has established a planning document that identifies three phases of distribution that will occur once a vaccine (or vaccines) is approved.
Phase 1: Potentially Limited Doses Available (Limited to First Responders)
Phase 2: Large Number of Doses Available (Critical Populations)
Phase 3: Continued Vaccination, Shift to Routine Strategy
Within this framework, the CDC notes that the only anticipated supply shortage might occur during Phase 1, during the initial growth in demand for vaccinations, but assumes a “likely sufficient supply to meet demand” during Phases 2 and 3. This is an important issue, as the assumption that supply bottlenecks will be solved at this point may be a challenging issue indeed. Our view is that there will exist major issues not only with vaccine supply but also with distribution issues.
We document these issues using the following SCOR framework of PLAN – SOURCE – MAKE – DELIVER – RETURN.
Here are some of the potential roadblocks that exist.
The Biomedical Advanced Research and Development Authority (BARDA) has estimated that 650 million to 850 million syringes and needles will be needed; yet there are significant capacity limitations that may exist. Experience shows that production capacity often needs to be booked a year in advance and must be committed to upfront. The total U.S. capacity of syringes is estimated at 40 million from Retractable Technologies Inc (RTI) in 2020, 40 million from RTI in 2021, and 140 million from Becton Dickinson & Co (BD) in 2020–2021.
In addition, planning requires monitoring of testing and identification of how many tests have been administered. A control tower is needed to measure this, as well as to record any adverse reactions that may occur.
There are many other significant bottlenecks that could arise during the deployment of a vaccine. These include stoppers, adjuvants, cold storage, lipids, and raw materials for syringes and stoppers. In particular, fill-finish capacity will be challenging to find on such a large scale, and there may be variations in the forecasts required to establish contracts with these third-party contractors.
Fill-finish capacity is required to meet the needs of the four or five emerging vaccines on the market. Industry experts are concerned that there is a bottleneck in the production of the brewing equipment that is needed to expand capacity and that it may take six to eight months to fill orders.
The Department of Defense and BARDA have a contract with SiO2 Materials Science for plastic vials: 40 million in June, 80 million in September, and 120 million in November.
These plastic vials have a microscopic glass coating and, according to SiO2, can be manufactured in a quarter of the time of glass vials. In March, SiO2 was producing only 14 million vials per year; it is unknown whether SiO2 hit its June production target. Pfizer is retrofitting existing facilities, so are Millipore Sigma and ThermoFisher Scientific -- but investment is needed. These companies need stainless steel tanks and disposable plastic bags for processing a vaccine.
Plastics have the potential to become a bottleneck. A supply chain director at a mid-sized diagnostics lab noted the following: “We have had an open purchase order since August, and our first delivery was supposed to be November, but it has been pushed back to Q1 of 2021. So if someone buys a plastic tray or a pipette tip from an unauthorized source, the warranty is automatically void.”
Cold chain logistics capacity is limited, as there is currently little information about which vaccines will emerge as the likely winners. There is also little information yet established about how allocation will be ensured to the different parties identified in the CDC COVID-19 plan, how the vaccines will be administered to the public (hospitals, doctors’ offices, pharmacies), and how the determination of whether an individual is prioritized and verified.
The collection and disposal of syringes will be a massive task. How these will be disposed of is not yet a consideration, and the logistics for collection is also not well documented.
These challenges will have to be addressed in the weeks that follow, and the new administration will be an important part of ensuring that this occurs.
(Note: Dr. Rob Handfield is a Co-Founder and Director Emeritus of Beroe Inc. A version of this article first appeared in NCSU’s Supply Chain Resource Cooperative website)
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