Will Domestic Production Solve U.S. Medical Supply Woes? Experts Say No

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Having the entire stock of U.S. medical supplies manufactured in the U.S. isn’t really feasible, speakers on a panel said Tuesday.

After studying the matter, “We concluded that wholesale government-mandated reshoring is really the wrong approach,” Meredith Broadbent, MBA, senior adviser at the Center for Strategic and International Studies (CSIS), said at the event, sponsored by the National Press Foundation and funded by the Hinrich Foundation.

“OECD [Organisation for Economic Co-operation and Development] models indicate that wholesale reshoring would not improve resiliency or efficiency of supply, largely due to a lack of diversification and an inability to tap into global networks of suppliers and producers,” Broadbent said.

Willy Shih, PhD, professor of management practice in business administration at Harvard Business School in Boston, gave one example why the supply chain can be complicated. For example, rare earth metals are now mined in Mountain Pass, California, “but the ore has to go to China for processing,” said Shih. “One of the things I think you will find if you probe congressional staff offices in Washington is there is a general lack of understanding of the detail of how these things are actually structured.”

‘Trusted Partner’ Network

A recent CSIS report — funded by drugmakers Pfizer and Gilead and by the U.S. Chamber of Commerce — called for the U.S. to develop a policy “centered around diversification within a network of trusted supplier companies who would cooperate with the U.S. in order to bolster and guarantee a steady supply of essential medical products for future public health crises.”

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The U.S. needs to develop a “trusted partner” network of countries in its medical supply chain, said Meredith Broadbent of the Center for Strategic and International Studies. (Photo courtesy National Press Foundation livestream)

“A ‘trusted partner’ network would offer member countries enhanced commercial ties; reciprocal reduction of trade barriers, investment, and other regulatory barriers; and a commitment of support from other trusted partner countries, especially during public health crises,” Broadbent said. “Eligibility criteria for trusted partner status could include commitments to safety and efficacy of medical products, IP [intellectual property] protection, and free data flows.”

Fiona Miller, PhD, director of the Centre for Sustainable Health Systems at the University of Toronto, said when it comes to supply chains, “we’re dealing with a very old problem; COVID-19 made it very difficult for us to ignore longstanding problems and has made some of them more acute.” Even though the problems aren’t new, some of the solutions are, she added.

Critical healthcare supplies could be interrupted in several ways, she said. Products may not be manufactured, such as in 2017 when hurricanes in Puerto Rico caused Baxter to stop making sterile saline for the U.S. market, “or you may have limited numbers of manufacturers, so that when one goes down or one goes out of business you have a critical shortage — that’s what happened with propofol about 10 years ago, which is a critical input into anesthetic practices,” said Miller.

Or raw materials could be lacking, she said. This has happened a lot during the pandemic — for instance, the non-woven variety of polypropylene needed for masks and respirators; “we don’t even have the machines to make that material,” Miller said. “These can all mean the products can’t be made in sufficient supply.”

Dealing With Environmental, Labor Issues

Other issues include threats to products’ availability where they’re needed — “they exist, but they don’t move” because of export bans, flight cancellations, or other challenges with global freight, said Miller — or regulatory barriers that keep them from being shipped or sold.

These problems are longstanding but “what’s new is we’re starting to have very interesting conversations about industrial policy, about a reinvigorated approach to ensuring the security of supply,” she said. “It very much is about these issues of national security but it goes beyond that and entertains questions about climate change and environmental issues, about labor standards, and about economic opportunity, including for communities that are not getting the opportunities they should get.”

President Biden’s recent executive orders are good examples of this, said Miller. “Here the issue is national security but also being cognizant of the climate crisis and [how] that’s going to disrupt supply, and thinking about the challenge of forced labor — there’s a lot of child labor and modern slavery in the medical supply chain now, so how does that get dealt with? And thinking about the opportunity to strengthen domestic manufacturing, and to provide access to communities that have been left behind.”

Educational Process Needed

Convincing people in the U.S. that international partners are needed will take some doing, Broadbent said in response to a question from MedPage Today. “There is a political issue there. Particularly in the pharmaceutical area, there is so much complexity in how we are innovating on vaccines; it’s very much a globalized international process, as in Pfizer’s case where it required an international partner to actually get their vaccine up and running. I don’t think the complexity of what it takes to produce some of these products in a modern economy is fully appreciated. I think part of this is going to be an educational process” on Capitol Hill.

Miller said that changing things will take a while. “It has taken 20-odd years to get to the point we’re in of these incredibly complicated multi-tier globalized supply networks … moving one material from here for broad processing and back,” she said. “It’s going to take decades on some of these issues to reverse that … It’s about a fairer approach to trade, a more explicitly managed approach to trade. I hope we’ll move away from what we’re currently seeing, which is rich countries increasingly thinking about how they can become more secure, but holding on to institutions that are making the developing world insecure.”

Martha Mendoza, national reporter for the Associated Press and a co-producer of the “Frontline” documentary “America’s Medical Supply Crisis,” urged the audience not to gloss over the serious environmental and labor issues in the medical supply chain. For example, latex gloves are made in an environmentally damaging way such that “the raw materials are devastating forests,” she said.

In addition, the workers in the glove factories — who have paid large recruiter fees to get the jobs — are toiling in deplorable conditions. “They are locked in their dormitories; they’ve had massive COVID outbreaks; they are shipped home in coffins because they die on these jobs,” said Mendoza. “They have major accidents at these factories with amputations of different parts of their bodies…. And here in the United States, we’re just whipping these gloves out of these boxes, snapping them on, everybody getting a vaccine all day long, and there’s a cost to that.” (U.S. regulators last year banned imports from one major manufacturer in Malaysia, Top Glove, over these issues.)

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    Joyce Frieden oversees MedPage Today’s Washington coverage, including stories about Congress, the White House, the Supreme Court, healthcare trade associations, and federal agencies. She has 35 years of experience covering health policy. Follow

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