MEE TING REP O RT

Global health security:
addressing the threat of short
supplies of essential medicines andvaccines
Publication date: 1 March 2022

On 3 February 2022, the Access to Medicine Foundation organised a virtual forum to identify ideas andsolutions for strengthening the global supply of essential medicines and vaccines. Experts from across thehealthcare industry, policymaking and procurement worlds joined the event, sharing strategies and insights that
can help to reinforce global health security.
Vulnerabilities in the global medical supply chain have been a concern for some time – as highlighted in our
2018 paper on weaknesses in antibiotic supply chains. However, the COVID-19 crisis brought fresh attention to
the scale and importance of the issue. Supply chains urgently need to become more robust and resilient in order
to absorb disruptions that could otherwise threaten the continuous delivery of critical medicines and vaccines
to the people who need them, especially in low- and middle-income countries (LMICs).
This event formed the latest in the Foundation's series of Amsterdam Sessions, which are roundtables convened
to address priority topics and challenges in improving access to medicine. This latest Session built on a key
theme that emerged in the June 2021 Amsterdam Session on lessons learned from COVID-19, during which
supply chain resiliency was central to the discussion.
The Session was productive, with participants sharing best practices around safeguarding and strengthening
supply chains (e.g., keeping buffer stocks; planning; and reducing reliance on a small number of suppliers), as
well as best practices in procurement policies that can help stimulate better access and quality (e.g., measures
to ensure better local availability; closer relationships with suppliers). It is clear that the realities of the last two
years have prompted many within the industry to adjust their approach and to address the risk of future shocks,
whether that be another pandemic, a geopolitical crisis, a natural disaster, or climate change.
The outcomes are summarised in the following sections:
1.
2.
3.
4.
5.

Challenges to global health security
Planning: How producers and procurers can plan more effectively to reduce the risk of shortages.
Production: How manufacturers can manage their supply chains and safeguard continuous supply.
Procurement: How procurers and policy makers can mitigate the risk of stockouts and help build
healthy supply chains.
Key Takeaways

About the Access to Medicine Foundation
The Access to Medicine Foundation is an independent, non-profit organisation based in the Netherlands. It aims
to advance access to medicine in low- and middle-income countries by stimulating and guiding essential
healthcare companies to play a greater role in improving access to medicine. The Foundation is funded by the
UK and Dutch governments, the Bill & Melinda Gates Foundation, AXA Investment Managers, the Leona M. andHarry B. Helmsley Charitable Trust, and the Wellcome Trust.
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Challenges to global health security
Workshop participants shared the varied challenges their organisations have faced with supplying essential
medicines and vaccines. These challenges have included sudden peaks in demand for particular products, aswell as shortages, stockouts, and large increases in prices for raw materials. Some participants reported thatthey had been hit by disruptions in international shipping, while others experienced shortages of skilled labour.
That said, many participants emphasised that global health supply chains continued to function despite the
COVID-19 pandemic, and shortages and stockouts have not been universal – thanks, in part, to some of thesolutions and shifts set out below.
More broadly, there was discussion of problems posed by reliance on a small number of suppliers for raw
materials such as active pharmaceutical ingredients (APIs), excipients and packaging materials. Issues notdirectly related to COVID-19, such as manufacturing sites unexpectedly going ‘offline’ for periods of time orleaving the market altogether, have also had knock-on effects within certain product supply chains.
This further highlights the danger of overreliance on small numbers of suppliers, or on suppliers concentrated in
one region or country. Among other risks, a highly concentrated group of raw material suppliers leaves global
supply chains vulnerable to the effects of unexpected disasters, such as a fire breaking out at a manufacturing
centre, earthquakes, regional conflicts, or crises caused by climate change.
Meanwhile, on the procurement side, reliance on imported essential health products is a potential weakness formany areas of the world, as the steady and reliable supply of a critical medicine or vaccine could be interrupted
by unforeseen trade issues such as sudden export restrictions or disruptions to shipping.

Seeking solutions – the three ‘P’s
Discussions on the day were divided into two panel sessions. The Foundation invited speakers and participantsfrom industry, government and procurement bodies with a wide range of experiences and perspectives. Joining
us as moderators and guest speakers across the event were:• Peter Beyer, Unit Head Impact Initiatives and Research Coordination, AMR division, WHO – moderator• Jayasree K. Iyer, CEO, Access to Medicine Foundation - moderator• Jordi Balleste, Unit Chief Procurement, Strategic Fund, PAHO
• Janet Byaruhanga, Senior Program Officer for Public Health, NEPAD• Akthem Fourati, Chief of Medicines and Nutrition Centre, UNICEF Supply Vision• Sinead Griffiths, Head of Global Supply Chain, Viatris• Umesh K, Senior Vice President Global Anti-Virals & Licensing, Aurobindo• Steffen Lang, Global Head of Novartis Technical Operations• Glaudina Loots, Director of Health Innovation at the Department of Science and Technology for theGovernment of South Africa• Sreenivas Rao Nandigam, Global Head of Supply Chain, Sun Pharma

The solutions identified are summarised below under three themes, dubbed the ‘three Ps’: Planning, Production
and Procurement.

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1. Planning•

Just in case, not just in time: Improving global health security requires a shift in thinking, with the past two
years demonstrating the limitations of the just-in-time supply chain. Moving towards a just-in-caseapproach can help to prevent shortages – e.g., by building up safety stocks of key manufacturingcomponents and products. More companies now see value in holding higher stock levels, in order to beable to absorb some degree of shock in the supply chain. This trend applies across the whole supply chain;from building up safety stocks of APIs and raw materials, to all the way through to ensuring sufficient buffer
stocks of finished products within the regions or countries where they will be needed.

“From ‘just in time’, we've actually moved to ‘just in case’… oneof the biggest learnings for us is to create backups.”•••

Forecasting: As a complement to the above, smart forecasting for supply and demand plays a central role in
reducing the risk of shortages, even in times of crisis when supply can be disrupted, and demand can beless predictable. An on-the-ground, localised approach to forecasting and demand planning is helpful –especially in LMICs.
Identifying and prioritising essential medicines: It is necessary for companies and healthcare systems toidentify which medicines and materials are absolutely critical, in order to prioritise their manufacture andprocurement and prevent shortages and stockouts. There are particular problems with the supply of antiinfectives (e.g., antibiotics) in LMICs, such as disincentives to supply and stock older antibiotics, as theAccess to Medicine Foundation explores in the 2021 Antimicrobial Resistance Benchmark.
Collaboration with other pharma companies: While companies have previously come together on R&D
projects, e.g., in the fight against HIV and malaria, recently we have seen companies develop new forms ofcollaboration to augment supply, prevent shortages, and ensure local availability of essential medicines
globally – with mutual benefits to those involved. Beyond COVID-19, this spirit of collaboration could be
harnessed across the supply chain as different stakeholders work to improve global health security.

“During the past two years, I saw an unprecedented tendency
amongst pharma companies to collaborate… We reached out toour competitors. And easily found partnerships.”•

Making full use of technology in logistics: Technology can help the supply chain run more smoothly, e.g.,with greater use of software to track shipments, handle shipping documents, understand and foresee
potential delays, and confirm timely receipt of the products. Technology has been well-utilised by many
companies over the past decade, e.g., in stock management, as previous Indexes have found – but the
COVID-19 pandemic expedited the adoption of good practice in this area.

2. Production•

Whole supply chain approach: Security of supply must be considered across the whole supply chain, as asingle missing component – e.g., sterile glass vials – can entirely disrupt the production of an essential
product. It’s not just about specific critical components; it’s about ensuring continuity of supply of allcomponents. It is sensible to identify multiple sources of all necessary materials well ahead of time.

“You need to focus on the continuity of supply of every lastcomponent, because it can be the smallest component that cancause a disruption in your supply chain.”•

Dual supply chains: One effective strategy deployed by a company participating in the workshop was to use‘dual supply chains’, ensuring that essential products have at least two separate supply chains or sources.

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••Preventing shutdowns: During the COVID-19 pandemic, it has been vital to prevent disease outbreaks at
production sites, which could cause shutdowns. With the onset of the COVID-19 pandemic, pharmacompanies moved swiftly to reduce the number of people on-site, and to provide these essential workers
with PPE, while other employees switched to working virtually.
Local and regional production as a strategy: One major area of discussion was the role of local production in
global health security, and especially its role in preventing shortages or stockouts of essential medicinesand vaccines in LMICs. Workshop panellists and participants offered varied perspectives, such as:⇒ Local production is key, especially to increase preparedness for crisis situations that can lead tosignificant challenges – because, for local production to be effective during a crisis, it must already be
operational and fully functioning before the crisis. Crises can lead to issues including trade barriers,
shipping delays, or restrictions on international exports (e.g. of vaccines). Local production may havethe strongest impact on security of supply when it is end-to-end, rather than focused on a specificelement or component in the product supply chain (e.g. APIs, fill and finish, or packaging). For
multinational companies, a diverse global network of manufacturers can also be a benefit as it
mitigates risks posed by centralised production.
⇒ Not every single medicine would need to be manufactured in every single country – this would be
inefficient, costly, and could lead to increased prices, as economies of scale would be difficult toachieve. However, regional production could offer solutions, increasing local availability in, e.g., SubSaharan Africa and ensuring LMICs are less vulnerable to disruptions to imports and problems in the
broader global supply chain. Regional production also can empower neighbouring countries to produce
and procure products that are the most relevant to the diseases disproportionately impacting their
populations.
⇒ For local production to become more prevalent, there must be a focus on how potential manufacturers
in LMICs can obtain financial backing and/or support, and on how pharmaceutical companies can help,e.g., via tech transfers, or by supporting local vaccine manufacturing hubs. Key examples of how
companies are taking action in this area can be found in the 2021 Antimicrobial Resistance Benchmark,and tech transfers will also be explored in the 2022 Access to Medicine Index.

3. Procurement•

Beyond price and quality: Participants in the session felt it was important to think not just about pricing andquality when making procurement decisions, but also about security and continuity of supply. There isincreasing awareness that promoting long-term sustainability should be a key decision-making factor inprocurement. One way to approach this is by procuring from multiple sources to maintain a strong market,
and to prevent other companies from retreating if they are not awarded an exclusive contract.

“We can see today that procurement is much more than handingout a request for proposals, selecting the cheapest offer andgetting the product.”••

Choose suppliers carefully: As part of the process of expanding and developing the supplier base, thecriteria used to evaluate potential suppliers should expand to take account of whether those suppliers
follow safe and responsible practices. Companies and procurers should seek to use suppliers with a goodtrack record on EHS (Environmental Health and Safety), which can be determined by, e.g., checking
whether the supplier has had warning letters from regulators. One tangible benefit is that this can reduce
the likelihood of sudden disruption caused by a factory being shut down due to a lack of compliance.
Consider suppliers’ ESG performances: In addition to the EHS considerations explored above, participants
highlighted the benefits of working with suppliers who perform well in ESG (Environmental, Social andGovernance) metrics. Rewarding responsible practices by suppliers boosts global health security, ensuringthat manufacturing is sustainable in the long-term. Participants suggested that considering ESG as a factor
in supplier selection will soon be the standard, mainstream approach.

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“Using suppliers with high level of ESG compliance has been actuallya big winner for us… this is one more filter we will put in toevaluate a vendor or supplier.”••

Role of pooled procurement: In volatile times, supranational bodies involved in pooled procurement canensure redirection of essential medical supplies to those within the network of buyers that have an urgent
need, maintaining equitable distribution in the international context. In terms of continuity of supply, there
are significant advantages to pooled procurement, on both the supply and demand side – i.e., ensuring
security of supply for the governments involved, and offering manufacturers certainty around volume.
Suppliers and procurers working more closely together: Procurers can benefit from ensuring an open line ofcommunication with their suppliers, so that both parties can adapt to supply and demand and get ahead ofupcoming challenges. Participants reported that clear, regular communication between procurers andmanufacturers has led to more productive relationships.

“COVID has taught us that we had to be closer to suppliers…
Listening to suppliers has helped us respond and be more agile.”•••

Speeding up tender processes: Streamlining this process can make procurement more agile and responsive
to demand, and more attractive to suppliers.
Harmonising regulated markets: If regulatory requirements are harmonised across regions or continents,
this can remove one barrier in procurement. On the industry side, wide registration of new and existingproducts should be encouraged in LMICs where both the Benchmark and the Index have identified thebiggest registration gaps; and on the policy side, local regulatory requirements can be made clearer, lessburdensome, and more standardised. Progress on setting up the African Medicines Agency is a positive signthat this challenge is being understood and addressed.
Strategies to procure locally produced medicines and vaccines: Building on the conversations around
localised production summarised above, participants discussed how – and whether – procurers can use
local production and procurement to ensure continuity of supply and local availability of essential products.
Participants and panellists shared their thoughts, such as:⇒ Supranational procurement bodies have a certain responsibility to ensure that procurement decisions
support economic development in the LMICs involved, e.g. in terms of opportunities for local industry
and workers, and by building up local capacity.
⇒ If national governments favour suppliers within their own countries, companies based abroad may
perceive that certain governments will favour the procurement of products from within their own
jurisdiction and retreat from specific markets as a result. This could lead to higher pricing and a lessdiverse supplier base. On the other hand, it is understandable that governments will want to support
local suppliers, especially in the context of security of supply and economic development.
⇒ Producing locally, close to the patients who will use the product, could help to keep pricing steadier(e.g. by reducing risks associated with inflation, global currency fluctuations, high transportation costs)
and help guarantee regional stocks.

“We have the intention to shape healthy markets, where supply is
sufficient to meet demands, products are affordable and there iscompetition and sufficient geographic diversity of suppliers thatcan lead to more sustainable and secure markets.”

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3 key takeaways
Considering all of the challenges companies, governments and procurers faced over the last two years, it isremarkable that so many innovative approaches and solutions have emerged, as those involved in the global
medical supply chain sought to ensure a continuous supply of medicines, vaccines and other essential
healthcare products. Producers, policymakers and procurers alike are awake to the importance of addressing
the risk of shortages of essential medicines and vaccines. Yet, significant and deep-rooted issues must still be
addressed. For this reason, it is vital to act on these three key takeaways from the Amsterdam Session:
1.

Global health security must be a top priority: Challenges to global health security can be both chronic (e.g.
the overconcentration of suppliers) and sudden (e.g. geopolitical crises), posing serious threats to global
access to medicine and essential healthcare.
It is vital that global health security is front-of-mind in decision-making – whether that means companies
shifting from a ‘just in time’ to a ‘just in case’ approach to manufacturing, or procurers consideringcontinuity of supply as a factor in tender processes, or institutional investors making this a priority at theboardroom level. All stakeholders in the global medical supply chain will benefit from working closely
together to prepare for future shocks, and then collaborating and cooperating when crises do occur.

2.

Widen and strengthen the supplier base: Manufacturers and procurers alike should move away from singlesource or limited supply chains of both raw materials and finished products.
For companies, this may involve expanding the raw material supplier network and looking carefully at which
suppliers to use; and for procurers, this may involve awarding tenders to a more diverse range of suppliers.
Technology transfers, capacity building, and collaborations between multinational corporations and local
manufacturers can boost local availability of essential medicines and vaccines.

3.

Identify and fix the weakest links in access to medicine: The last two years have highlighted the many
interconnections between different parts of the pharmaceutical and healthcare industries, as well as
specific challenges in certain sectors and supply chains. In order to make sure that everyone has access tothe medicines, vaccines and healthcare products they need – and in order to reach the UN’s goal of
Universal Health Coverage (UCH) by 2030 – we must bolster global health security by making sure there are
no weak links across the entire continuum of care.
This involves identifying the biggest vulnerabilities in access, e.g. in specific healthcare sectors and specificregions of the world, and taking action. More players need to get involved, including those who produce
essential products such as diagnostics, vaccines, and medical gases. This approach is part of the Access to
Medicine Foundation’s new Strategic Direction, as we bring a broader range of essential healthcarecompanies to the table.

To discuss the contents of this report, please get in touch with Kelly De Baene:kdebaene@accesstomedicinefoundation.org.

About the Amsterdam Sessions
The Amsterdam Sessions, organised by the Access to Medicine Foundation, provide a unique space for people working with and within
pharmaceutical companies to come together and discuss access to medicine. Each Session focuses on a specific area where pharmaceuticalcompanies have a clear role to play, and is joined by independent experts working within governments, NGOs or the investor community.
Through moderated working groups, the Sessions facilitate the sharing of best practices and approaches. Participants use the insights toredefine access strategies and internal metrics. In turn, the Sessions inform the Foundation’s own metrics for tracking pharmaceuticalcompany performance on access to medicine and antimicrobial resistance (AMR). The Foundation has organised Sessions on: lessons
learned from COVID-19; access to cancer care; best practices and impact; appropriate access; and AMR.

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