Each and every industry across the globe has been impacted by the ongoing coronavirus pandemic. And while most companies and businesses are still in crisis mode, it is important to look at the future and see how this pandemic will impact the essential functioning and nature of certain industries.
Let us take for example the pharma industry which was one of the hardest hit when countries like China went into a total lockdown. Global supply chains were thrown into complete disarray due to the lack of availability of APIs (Active Pharmaceutical Ingredients), the majority of which are produced in China and India. Not only did this impact global supply chains, but also halted studies and crucial drug trials across the world.
Below are some of the major changes that are likely to occur in the pharma sector in the next few months.
Shifting supply chain locations
The Covid-19 pandemic has proven that over reliance on one geographical location for supply of raw materials is dangerous. As long as one country or a particular region supplies the bulk of APIs, global supply chains remain vulnerable to disruption. Hence, there is a growing lobby of voices in the pharma sector that is calling for moving away from South-East Asia as a production hub. Although this does sound like a tectonic and impossible shift, several companies across the US are already actively focusing on sourcing raw materials domestically in order to evade geopolitical risks. In fact, the EU’s health and food safety commissioner recently said, “The current situation has exposed some structural weakness in the EU’s medicines supply chain and a high dependence on non-EU countries for active pharmaceutical ingredients.” All of this indicates the world’s willingness to reassess and reevaluate traditional practices and move away from geographically vulnerable supply chains.
Welcome new tech-based solutions
Technology will take us into the new post Covid future. Going forward, tech-assisted solutions will be the new norm for many industries, and the pharma world is no exception. Most companies will look towards adopting digital tools for greater transparency and more agile operations. For example, Medidata, an American technology company, is currently conducting a three-year-long virtual study with over 14,600 patients. Each individual’s observations gathered during the trial are stored in a database for researchers to access; the whole process is done with minimal physical communication and friction. To many this might sound like a dystopian future, but it will be the norm for most organizations in the years to come. Another way pharma companies across the globe will use tech tools will be in the area of assessing stockpiles. Digital tools developed to track and assess availability of global medicine stockpiles will lead to more international transparency and better planning for unforeseen situations. There will also be a focus on more automation in the production sphere; a total shutdown at manufacturing plants across the board. Therefore, whether or not we like it, tech-based solutions will be an inextricable part of the future of pharma.
Embracing Risk Management
Before the Covid-19 pandemic hit risk management was always in the background for many companies. However, this pandemic has exposed faultiness in our current systems and shown how important it is for companies to have risk management teams in place. Companies will now want to be better prepared for unforeseen circumstances like turbulent weather events, geopolitical instabilities and cyber warfare. Risk management professionals help to foresee such calamities and create plans to tackle them when they happen. A recent report by McKinsey states that in the aftermath of COVID-19, there will be an intense focus on risk management across networks and supply chains despite the inevitable increased costs.
Last but not the least, pharma companies may finally be given the push to come out of the shadows of profitability and finally invest in research and development. Most big pharma companies have traditionally shied away from investing in vaccine development and trials due to low profit margins, however, a pandemic of cataclysmic proportions like this one may change attitudes. Big pharma companies could actively invest in research on infections and antibiotic resistance in order to aid global stability and prevent future health emergencies.