White Paper

Ensuring Resilience: How Life Science Is Reshaping Supply Chains In Response To COVID-19

Source: Cambrex

COVID-19 put life sciences supply chains under unprecedented pressure. Almost overnight, the long, global supply chains created in an era of easy cross-border trade were hit by national lockdowns that made it harder to keep getting products to patients. The experience forced companies to consider the effect of globalization on supply chain resilience, driving growing interest in reshoring operations.

The industry was beginning to question whether globalization had reduced the resilience of supply chains even before COVID-19 brought the topic into sharp focus. In late 2019, the FDA shared data showing 72% of active pharmaceutical ingredient (API) manufacturers supplying the US market were based overseas.1 The US lacked any domestic suppliers of some APIs used in essential medicines, and the FDA said it was working to prevent globalization becoming a national security risk.

COVID-19 confirmed theoretical concerns about supply chain resilience. In March 2020, the Indian government restricted the exportation of tens of APIs and finished products, before going on to ban shipments of drug substances and products as they emerged as potential treatments for COVID-19.2,3 Chinese exports of pharmaceutical products halved between January and February 2020.4

The life sciences industry contended with the problems at a time of global workforce disruption and surging demand for particular products.5 Parts of the supply chain failed to keep up, leading the FDA to warn of shortages of drugs used in the treatment of patients with COVID-19 such as propofol and dexmedetomidine.6 The FDA issued a series of drug shortage notices, each attributing the problem to demand increases, in the early weeks of the pandemic.7

To understand how that experience is shaping attitudes toward resilience, Cambrex surveyed 117 leaders, mainly from biopharma companies. Around half of the respondents outsourced at least part of their supply chain to a contract development and manufacturing organization (CDMO).

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