Hospital  Times Editor David Duffy tuned into an IQVIA webinar, hosted by Pharmaphorum, to ascertain just how the global pharma and biotech sectors are adjusting to this global crisis. 

As COVID-19 tightens its grip on health systems and economies around the world, the global pharma and biotech sectors have a vital role to play. However, companies in this space must respond to a rapidly changing landscape and market dynamics. Behavioural patterns of healthcare providers will change beyond recognition. 

In the short term, healthcare resources are being massively diverted towards responding to the COVID-19 pandemic. The same goes for pharmaceuticals. Indeed, across the world the industry has risen to the challenge by rapidly mobilising support for healthcare systems and professionals with the speed and capabilities at its disposal. This of course extends beyond vaccine development.

IQVIA, the Human Data Science company which provides advanced analytics, technology solutions and contract research solutions to the healthcare ecosystem, is already delivering daily medicines supply chain data insights at national and local level to the UK Government. This will serve to protect the integrity of the supply chain of medicines needed to treat the virus, once those treatments have been approved.

Further to this, the life sciences industry is responding to the changing work patterns of regulators who are working to fast track potential treatments and rapidly evaluate their impact through real-world evidence. Until a vaccine is available, therapies licensed for other indications, but not COVID-19, are being put into accelerated clinical trials as potential treatments for the virus. 

The supply chain is holding firm, for now

Over the past decade, the medicines supply chain has become an increasingly integrated global network. As such, the COVID-19 pandemic has raised questions as to the resilience of the network as many Active Pharmaceutical Ingredients (APIs) are increasingly manufactured in China. Chinese and Indian APIs are the basis of many mass market generic medicines, including those now treating the symptoms of COVID-19 such as paracetamol, antibiotics and respiratory medicines. The World Health Organisation (WHO) estimated that China accounted for some 20 per cent of the total global output of APIs[1] in 2016 and it has risen since. Prior to the crisis, China was on its way to becoming a leading global pharmaceutical powerhouse, the COVID-19 will have undoubtedly impacted its API manufacturing growth[2], although recovery is now under way.

Needless to say, the risk that COVID-19-related factory closures pose to the global drug supply chain could be significant. India, it would seem, is particularly vulnerable to disruption in Chinese API manufacturing, given it sources over 70 per cent of its APIs originating from China[3]. In order to secure this stock, the Indian Government has recently temporarily restricted the export of key generic pharmaceutical products[4].

The American pharmaceutical market could also see risk in its medicine supply chain. While historically US generic medicines have been manufactured domestically, recent decades have seen a gradual shift to overseas production. The US stopped domestic production of penicillin altogether in 2004, and according to the US Food and Drug Administration (FDA) 88 per cent of US APIs were manufactured overseas in 2018 with 13 per cent of that in China.  However, news so far suggests that the global drug supply chain is proving to be resilient. 

Global supply chains have proved themselves to be resilient, but vulnerabilities  remain

Sarah Rickwood, Vice President of Thought Leadership and Marketing, IQVIA

“Fortunately,” says Sarah Rickwood, Vice President of Thought Leadership and Marketing at IQVIA, “much of the manufacturing base for China’s API production is based in coastal regions, away from the outbreak’s epicentre in Hubei.” This, she says, has allowed factories to resume manufacturing with low disruption. Furthermore, South Korea – a major centre for biosimilars manufacturing - has not seen any factory closures thus far. Equally, Indian drug manufacturers who are reliant on Chinese API manufacturing have not yet reported major shortages.

An illustration of the global API supply chain as things stand (17.04.2020)

In spite of this apparent stability, healthcare systems across the world are being put under significant pressure to secure their medicine supplies. In the UK, more than 80 different medicines have been banned from parallel export out of the country, a move largely designed to protect supplies of crucial treatments commonly used in intensive care. Adrenaline, insulin, paracetamol and morphine are all included on the ban list.[5]

“Global supply chains have proved themselves to be resilient,” says Sarah, “but vulnerabilities  remain and close attention must be paid to supply and demand over the coming weeks.”

The exposure to the reality of these vulnerabilities could bring significant change in the long term. Officials in the US are becoming increasingly aware of their reliance upon the Chinese API manufacturing base, which the Federal Government has already made assurances to correct.  The Indian government, for its part, has already announced plans to turn around the country’s dependence on Chinese API, with the intention of constructing three API manufacturing plants across the country.[6]

Some big  pharma  companies  are already making moves; Sanofi has announced plans for  significant investment into an API manufacturing base in Europe.  Clearly, while countries strive to maintain their supply chain, the COVID-19 outbreak will further accelerate and promote healthcare system supply reform on a global scale.

Local supply chain challenges

When it comes to managing stock at a local level and reading the market, the outbreak has posed a significant challenge. “Panic buying as well as sudden and genuine changing medical needs are creating new challenges in safeguarding patient access to crucial medicine,” says Rob Heathcote, Director of Product Management for IQVIA.

IQVIA is working to support Government by offering early warnings of potential medicines supply chain issues and help formulate effective responses to these challenges. A key approach will be using its supply chain manager data that covers both community pharmacy and hospital pharmacies. This data measures the flow of pharmaceutical products from the medicines wholesaler to the pharmacy.

Panic buying as well as sudden and genuine changing medical needs are creating new challenges in safeguarding patient access to crucial medicine

Rob Heathcote Director of Product Management, IQVIA

Notable changes that have already been directly related to the outbreak include many different medications and rapid increases in the purchase of hand hygiene products. IQVIA UK supply chain data revealed a 91 per cent increase in the sale of paracetamol from w/c 9 March 2020 against the average prior 2020 rate from all purchasers in the UK. According to Rob, “products used to treat conditions such as asthma, which previously have been considered to be in stable markets, are seeing sudden changes as doctors and patients react to the threat that the virus poses to people with existing respiratory challenges them.”

Rob went on to emphasise that, “managing stock and production depends on the early warning of changes so as to quantify changes in demand quickly and enable the Government and manufacturers to protect the integrity of the supply chain.”

The “black swan”: Wider healthcare learnings from China

It would come as little surprise to most that China is seeing some of the most dramatic changes from this outbreak, both in terms of pharmaceutical and life science dynamics and overall healthcare delivery.

Prior to this outbreak, the vast majority of medicines sales in China were hospital-based transactions. For many years the Chinese Government has pushed for further separation of prescription and dispensary services across the country. “COVID-19, it would seem, has sped up this development of online partnership distribution models,” says Howard Chen, Management Consulting Managing Principal IQVIA. Howard also went on to point out that Chinese patients are moving towards primary care services as opposed to always going to top-tier hospitals for all their medicines needs.

Due to limits upon technological capacity when compared with other healthcare markets, patients have begun moving to online retail platforms. “This is accelerating alternative pharma sales channels and developing new online business models,” says Howard.

Due to the scale of the outbreak in China, there have been significant delays in clinical trials there. Howard cites capacity as a key concern, both in terms of limited hospital sites and in the number of available trial professionals. In many places, there is simply not enough physical space within a hospital for substantive testing facilities that are not dedicated to COVID-19 patients.  Furthermore, all other major on-site work across Chinese hospitals has been put on hold, making it very hard for clinical trial specialists to go about their work.

Responding to this challenge, the Chinese government has begun promoting the use of virtual trials and, while there is currently a lack of IT capacity to conduct virtual trials or off-site trials when compared to other markets, “we are seeing acceleration in the development of virtual trial tools,” says Howard. Howard is also observing trends for the many pharma players that are increasingly practising online monitoring methods.

These professionals are fighting on the frontline for us against this disease, many under immeasurable physical and mental stress. We must support them in every way we can

Howard Chen, Management Consulting Managing Principal, IQVIA

Howard was also keen to outline the level of stress healthcare practitioners in China are operating under. An IQVIA survey of Chinese doctors showed that 1,447 practitioners identified medical supply and protective equipment as their most urgent need, with 84 per cent identifying it as a pressure point. Further to this, the survey also revealed concerning trends about the wellbeing of Chinese clinicians, with nine per cent citing shortages in food, clothing, housing and the ability of clinical staff to commuting to their places of work.  

“We must remember that these professionals are fighting on the frontline for us against this disease, many under immeasurable physical and mental stress. We must support them in every way we can,” says Howard.

While the ongoing situation is tough, Howard says there are signs that stakeholders are taking actions in expediting much needed reforms of Chinese healthcare, one of the biggest health sectors, hopefully health and wellbeing will be placed at the heart of Chinese healthcare policy consideration.

Potential impacts on innovation

With such focus and resource being poured into fighting COVID-19 and developing a vaccine, the outbreak poses a major disruption to the launch of other potentially lifesaving medicines for non-COVID-19 related conditions.

For companies  considering a delayed launch schedule, Sarah Rickwood warns of a crowded landscape in which companies will be looking to launch new medicines in late 2020, noting, “with so many potential launches in the latter stage of 2020, pharma companies will need to carefully consider the new environment in which they are launching products.”

A changed normal

While the world still deals with the immediate crisis and many countries are yet to face their own case peaks, the  longer-term  ramifications of COVID-19 cannot be ignored. Indeed, the landscape is already changing.  Primary considerations will need to be given to the launch of new life-saving medicines and how we go about developing them with finite resources. Changes to the actual delivery of healthcare services also has its implications as remote engagement and virtual engagement through digital technologies have been thrust to the forefront of the market.

While the global pharma and biotech industry continues to prove its resilience and adaptability responding to this crisis, there are challenges ahead and companies will have to get used to operating in a new environment. As Sarah astutely notes: “While there is the immediate crisis, there will be long term consequences. It is entirely possible that in some aspects the way our industry operates, the ‘pre-COVID-19 normal’ may never be fully be retrieved.”

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