Post-COVID-19 Supply Chain
Yadira Salamander, Director of Engineering Services, Alcami
A: Alcami’s simplified, entirely U.S.-based supply chain is one of our core strengths. At every phase of the product life cycle, risks are inevitable; this is especially true as supply chain complexities increase due to COVID-19. Alcami is equipped to solve these challenges for clients. As an integrated CDMO, we work with over 200 molecules annually and have developed a process to analyze and identify supply risks systematically and to create a risk-averse plan accordingly. We support tech transfer and validation of products in advance of potential manufacturing needs without a long-term commitment or minimum annual volume. Our integrated U.S. campuses serve companies across the globe. Our company size and broad in-house technical and regulatory expertise enable us to be agile and flexible in response to unforeseen supply chain needs and technical challenges. Alcami purchases diverse, specialized components for our CDMO services. For the best quality and availability, we must use global suppliers. COVID-19 has increased the use of paper-based and virtual alternatives to onsite activities. Alcami buys directly through brokers and from multiple suppliers to protect against supply interruptions. Alcami can also leverage clients’ qualified suppliers. Alcami offers clients an advantage to COVID-19 supply chain risks because our U.S.-based supply network has international regulatory qualifications. Alcami offers domestic supply with global reach.
David Duff, VP Procurement, Vectura
A: The COVID-19 pandemic has highlighted the critical role that procurement plays in managing the supply of goods and services, especially in times of crisis. Business continuity planning has been used to great effect and has reinforced the need to keep plans live and regularly updated. The traditional focus on cost management will always remain, but the greater emphasis on business continuity has highlighted the incremental benefits that procurement can offer across business-critical processes.
As a result, we are uniquely positioned, having both an internal and external perspective, which has proved vital in repositioning our supply chain priorities going forward. The dependency on logistics operations around the globe, especially air freight, has made us concentrate more on local and regional markets, reducing the risks associated with transporting goods and developing markets closer to home. COVID-19 has highlighted such risks and will influence how a company can best leverage the supply base going forward, accessing financially optimal benefits.
It is vital that the procurement function works with key stakeholders to deliver long-term business strategy goals and to invest in automation to help drive out costs. Collaboration is vital, and the more cross-functional teams we have, the better the results will be. Teams mean people, and, based on the resilience and drive observed during the pandemic, we are in very good shape and capabilities have increased. It is vital we continue to develop our teams so that they are able to respond to whatever new challenges we face in the future.
David Freidinger, Vice President of Pharma Solutions Business
Management, BASF
A: At BASF Nutrition and Health, global, regional, country, and site crisis-management teams are meeting regularly to further monitor the outbreak of COVID-19 and recommend the necessary mitigation measures. Our teams are all working hard to ensure business continuity and minimize the overall impact on business operations. More specifically, our production sites that produce many of the excipients, APIs, and ingredients have been given essential classifications and exemption from shutdowns that are implemented in various countries. We constantly review and update our measures in line with the recommendations from authorities, such as the World Health Organization, and depending on the specific situation on the ground. Our objective is to secure the continuity of our business operations and protect our employees, contractors, visitors, and the communities in which we operate. BASF fully supports the efforts of governments around the world to help contain the spread of COVID-19. These are important steps to combat the pandemic and help ensure the health of our society.
Regarding day-to-day operations, we have pivoted quickly to a virtual environment. Global meetings managed virtually had already become normal business practice, and the COVID-19 pandemic has only intensified this. Furthermore, it is important that we remain committed and connected to our customers — the pharmaceutical companies globally that rely on the many excipients, APIs, and ingredients that BASF manufactures. In order to do this, we have quickly converted many of our engagements with our customers to a virtual setting. Our sales and operations teams connect virtually with our customers, our technical service teams use video tools to troubleshoot challenges at our customers with live experimentation, and our technical experts connect with leading formulators through our Virtual Pharma Symposia.
COVID-19 has caused many of us in business to accelerate the use of digital tools and virtual settings far faster than would have occurred organically. From a strategic perspective, BASF is committed to further embracing this digital shift and converting many of the key services to a virtual format, including operations, sales, technical, quality, and regulatory service, to support the entire pharmaceutical industry.
Brian Albright, Global Manufacturing and Supply Chain Leader, Pharma Solutions, DuPont Nutrition & Biosciences
A: The COVID-19 pandemic has provided many lessons and inspiration for improvement related to areas from people to processes and systems.
We’ve had to completely re-think how to organize shift work at our sites to minimize the number of people and reduce the risk of contamination, yet still deliver quality products for our customers on time. We’ve cross-trained our employees to be able to cover various roles and enacted even closer collaboration through a Sales & Operation Planning Process between our commercial and supply teams to quickly react to market changes in this unpredictable environment. On the systems side, we’re pushing for even more “flexibilization” of our assets/materials to be able to make the same products in different assets in different regions. This has always been a priority for us, but it’s even more crucial as we visualize what may lie ahead. Lastly, focusing on inventory-build strategies to secure product in the event of unplanned shutdowns due to lack of resources is important. Focusing on business continuity is critical, but we’ve likely never had a better reminder of its importance than in 2020.
Wolfram Schulze, Vice President Information Systems, Organization, & Digital Transformation and Head of Infection Prevention Task Force, Rentschler Biopharma
A: The continuous optimization of operational fitness has always been an integral part of Rentschler Biopharma’s strategy. We have been closely monitoring and improving our processes, business continuity, and digital maturity, even before the outbreak of the COVID-19 pandemic. Keeping this in mind, we started an initiative to strengthen resilience to disruptions in global supply chains and focused on establishing alternative sources for raw materials, as well as to balance global and local vendors. By leveraging and further growing our strategic partner network, we will additionally ensure the reliable delivery of premium services to our clients. The Rentschler Digital Agenda and its initiatives will complement and further enhance our existing services with digital capabilities, which become increasingly important in our fast-paced and interconnected partner networks. In short, the COVID-19 pandemic helped us to verify that the direction set forth by the Rentschler Biopharma Strategy 2025 is even more valid than ever before and allowed us to re-prioritize related strategic implementation projects.
Henrik Ancher-Jensen, President, Order Fulfillment and Supply Chain, Agilent Technologies
A: The COVID-19 crisis has driven important strategic changes within Agilent: It has changed how we collaborate with suppliers, accelerated our evolution toward a regionalized supply chain, and prompted us to diversify our raw material supply base. We are also using this opportunity to accelerate our digital transformation journey and to realign our mindset given everything we’ve learned in 2020.
Supplier relationships: Today it’s even more important that we be in close collaboration with our strategic and critical suppliers. That includes understanding the circumstances of our suppliers’ suppliers, so Agilent can help several layers in our supply chain to overcome obstacles.
Regionalization: The globalization trend in the supply chain was already evolving toward regionalization. Today, that process has been put on steroids, and all future capacity expansion and footprint decisions will take into account the need for faster regionalization. We are also diversifying our manufacturing and raw material supply base to improve assurance of supply.
New product development: COVID-19 has revealed business opportunities in the infectious disease arena that require decisive action. We are currently exploring business and product opportunities that will require us to dramatically ramp up our new product development, along with everything that goes with it: developing manufacturing process maps and setups, accelerating quality validation steps to ensure compliance, etc.
A post-pandemic mindset: As we master new and creative ways of working, we are reimagining how Agilent will work in the future. By institutionalizing our lessons learned, we will be better able to minimize the challenges of any future supply chain disruptions.
Jean-Luc Herbeaux, Ph.D.,Chief Operations Officer, Hovione
A: Throughout the COVID-19 ordeal, our priority has been to protect the health and safety of our team members and of those close to them, and in doing so, we managed to keep our sites, processes, and systems working normally. This was made possible by highly proactive management and implementation of rules governing presence in the company premises, distancing, wearing personal protection, hygiene, travel, etc., as well as a superior commitment of all our employees to uninterrupted customer service and supply.
Like most, Hovione started by enforcing the well-known hygiene and distancing requirements, but we are now clearly in the next phase of our preparedness journey. We accepted that the situation will perdure and have started redesigning our processes, tools, and environment to adapt to our new reality. Taking meeting rooms as an example, we are shifting from reducing physical presence to the bare minimum to changing the design and configuration of our meeting facilities to allow for safe face-to-face interactions. In parallel, we have intensified our communication with customers. Our NavStream™ digital platform affords interested customers transparent access to production and analytical data. Our teams also developed virtual tours of our sites and are now preparing virtual audit capabilities.
Leon Wyszkowski, President, Commercial Operations, Pharma Services, Thermo Fisher Scientific
A: The global COVID-19 pandemic is a powerful reminder of the importance of Thermo Fisher’s mission, which is to enable our customers to make the world healthier, cleaner, and safer. Since the start of the pandemic, our top priority has been to protect the health and safety of our colleagues, while continuing to serve the needs of our customers. During this time, we have closely followed global and U.S health guidelines for increased hygiene protocols and tightened safety measures to keep our sites operational in order to bring critical medicines to patients. Our global business continuity planning and company-wide resources have enabled us to anticipate and respond to emerging issues.
For the last several years, we have strategically invested in capacity and capabilities across our pharma services network in the areas of biologics, cell/gene therapy, and drug products. These investments have enabled us to rapidly pivot to support the COVID-19 response. The pandemic has underscored the need for redundant capacity across regions of the world. While this trend was already underway pre-COVID-19, it’s more critical than ever for governments, academia, and industry to work closer together to ensure unfettered access to quality supplies globally.
Over the last few months, we have worked closely with our supplier partners, validated alternative sources of supply, monitored our supply chains, and expedited transportation modes wherever possible to ensure critical inventories for both COVID and vital non-COVID medicines. Our team has also been able to successfully navigate quarantined zones to continue deliveries thanks to our Total Transportation Management (TTM) service line. For clinical trial logistics, a new ‘site-to-patient’ program, launched at the start of the pandemic, has ensured patients continue to receive their lifesaving investigational drug shipments without having to visit a clinic, one of many efforts to maintain supply chain continuity during the pandemic.
Matthew Lawrence, M.D., Ph.D. Chief Executive Officer & Chief Scientific Officer, Virscio
A: Virscio’s work on the preclinical evaluation and development of biologics, gene and cell therapies, and innovative small molecule and sustained-release formulations depends on the availability of these test articles, many of which are generated by our partners and sponsors or by contract manufacturers.
Each of these faces their own supply chain challenges relating to personnel availability and upstream material production and distribution. As such, the COVID crisis has served to validate our longstanding pursuit of uninterrupted workflow — and positive contribution to the biomedical community — by diversification of our client base and development programs engaged. Maintaining a pipeline of contracts of different scope and platform requirements allows management of a research schedule that balances capacity utilization and aligns test article availability timelines to advance programs as quickly as possible.
Other longstanding resiliency practices that have been further enforced in adaptation to COVID-19 disruptions include procurement, maintenance, and use of research and vivarium supplies and staff training on sustainability practices. Expiratory date monitoring, reorder thresholds, project load-driven projected usage, and vendor and product order information are all coordinated in an electronic inventory management system, which now includes an intentional expansion of vendors as alternate suppliers, allowing quick pivots to fulfill procurement needs.
Ultimately, operational fitness is most meaningfully impacted by the health and well-being of our indispensable human resources, with continued growth now keenly focused on situating team members where they can most safely and efficiently contribute to the Virscio mission — a practice that will long outlast the pandemic.
Brad Payne, Chief Operating Officer, PCI Pharma Services
A: Like many companies, we had to adjust to doing business in a virtual/digital world because of social distancing. At PCI, we were already in the process of a digital transformation, and the COVID-19 crisis served as an opportunity to accelerate what we had started.
For example, there are many manual operations we used with clients that we are now streamlining via digitization, like document signatures and storage and project status tracking. In an effort to keep lifesaving drug launches on track, we started doing virtual site audits for the first time, which ran so smoothly that we want to use this as a new model for the future. We are also adapting to the virtual world by fast-tracking our plans to develop direct-to-patient clinical trial capabilities. While we had to find alternative solutions in the moment, this model may be more financially viable for our clients going forward. Because of COVID-19, our employees and clients had to embrace new technology, and this is a very positive thing for the changes we want to make long-term.
Lastly, the COVID-19 pandemic provided us with an opportunity to be innovative problem solvers, which is what we do best at PCI. For example, our teams had to figure out ways to get lifesaving medications for COVID-19 into counties within 48 hours or less where borders were closed. Beyond urgent issues like this, the COVID-19 pandemic prompted us to re-examine the ways we work, and we have found that some of our old methods and ways of thinking are no longer necessary. We learned to retire old systems and thought processes that didn’t make sense in the new normal. We have proven to ourselves that we can adapt to new ways of working, make changes, take risks, and still deliver on the outstanding client experience we are known for in the industry. This continues to inspire even more out-of-the-box thinking from our teams.
Yann Bayeux, M.D., Supply Chain & Purchasing Director, Minakem
A: As our suppliers maintained deliveries, there were no disruptions to Minakem’s production schedule during the COVID-19 lockdown.
Minakem adopted a risk-mitigation program 18 months ago, which consisted of ranking in order of priority the most critical of each of our raw materials and better addressing how to diversify outsourcing and contractual needs in order to implement safety stocks. Diversifying our source of raw materials and their geographical locations enabled us to shift suppliers and maintain delivery.
Nevertheless, we are still relatively dependent on Asian sources. In 2019, we initiated a de-risking program to reduce our presence in Asia and certify European or North American suppliers. We are currently putting tools in place to better monitor the geographic locations of our suppliers and track our progress. As a next step, we will further investigate the locations where our suppliers source raw materials. This is a huge undertaking, which we plan to phase in.
Despite the current situation, we are not planning to bring the early steps of chemical synthesis in-house but to remain focused on our core API business. Outsourcing remains a pillar of our strategy. Price is one component in our decision process, but the reliability of our suppliers and the peace of mind of customers is crucial.
Regarding COVID-19, our main challenges are related to indirect purchases. We were confronted with a dramatic disruption in production supplies, such as protective masks, which were suddenly requisitioned by governments. On short notice, the purchasing department, in collaboration with SHE (Safety, Health & Environment), identified alternatives that were not in competition with other market applications.
COVID-19 required a new level of anticipation and responsiveness. We have launched a Supply Chain DRIVE project to align our planning (raw material deliveries, projected stocks, production, QC, QA) with our financial performance and OTIF (on-time, in-full) enabling multi-scenario simulations. The ultimate objective is to provide the best service to our customers by satisfying their expectations while maintaining strong business performance and growth so that we can continue investing for their benefit.
