The United States needs a national supply chain for this pandemic and future ones


ATo what extent do the benefits of local production of medical supplies outweigh the potentially higher cost? The sudden and almost overwhelming demand for Covid-19 testing during the Omicron phase of the pandemic means that the United States is now at a critical point where we need better – and faster – access to testing supplies through a national supply chain.

Over the past three decades, the world economy has become increasingly globalized, leading to lower inflation-adjusted prices of goods and products and improved living standards around the world. The Covid-19 pandemic has provided an opportunity to once again debate America’s reliance on cheap foreign manufacturing and to reconsider the value of high-quality domestic production.

Specifically, the pandemic has underscored the need to access the domestic supply chain for US FDA-cleared medical equipment, especially testing supplies, which can help save lives. It can also have wider effects, such as stimulating the economy with increased production by American companies.


American companies involved in the Covid-19 response for testing and other critical needs have, out of necessity, supported and in many cases established production of their key products in the United States to quickly meet demand. The domestic manufacturing capacity that my company and others in the testing and diagnostics industry have established needs to be protected from foreign competitors to ensure people have access to Covid-19 supplies and tests.

Prior to the emergence of Covid-19, the medical supply landscape in the United States was very different than it is today: demand was constant and manufacturers were able to handle small increases in capacity and limit excess inventory. Take, for example, virus sample collection in January 2020. The main producer of swabs and sample collection devices was based in northern Italy, with US production accounting for less than half of an average year of US demand. Copycat products were also made in China, but not on a large scale.


A few months later, as the pandemic began to sweep the world, all excess supplies and surge capacity were purchased by China and Southeast Asian countries, the initial major hotspots of Covid-19, while manufacturing was expanded in these regions to provide more supplies. As the pandemic subsequently ravaged northern Italy and the rest of the world, its production of swabs and sample collection devices dwindled. So, to meet the needs in the United States, the president invoked the Defense Production Act and released government funds to help American companies build facilities and expand production capacity.

The Department of Health and Human Services has given my company, Maryland-based Longhorn Vaccines and Diagnostics, priority for U.S. production of one of our key virus testing products, while researching additional solutions the shortage of other medical supplies such as masks, respirators, and disposable medical kits. Fortunately, American companies were able to scale up and produce a supply chain for what companies like mine and the country needed in the short term.

The situation has improved since the early days of the pandemic regarding the availability of tests – and of all medical supplies. Yet the government has failed to follow through on a long-term solution to support continued domestic manufacturing. Players in the testing industry are still facing challenges as Covid-19 and its variants sweep the country. Government support is therefore needed for a clear, long-term plan for manufacturing medical supplies in the United States and to meet the ups and downs in demand. for testing and medical supplies.

Specifically, as the Covid-19 workload fluctuates between new waves of variants, US testing companies have seen a rapid shift from a position of overwhelming demand to one of large excess inventory. The same thing happened in China. At a time when American companies were in full production, Chinese companies that had increased production flooded the American market with testing supplies as well as other medical equipment priced below the cost of production, undercutting the American companies and making many of them uncompetitive. This has put several American companies out of business, such as those manufacturing masks. In this type of situation, it is difficult for American companies to maintain production capacities and competitive prices, even if American companies can provide better FDA-cleared products that are more accessible because they are manufactured in the States. -United.

Another major challenge facing US testing companies is how to build stores of Covid-19 supplies when there is no immediate demand, but there may be in the future. The answer ties directly to US government guidelines for testing companies as part of a long-term plan, which could also encompass the broader medical supplies industry. As Covid-19 testing declined from spring to summer 2021, businesses large and small, which were still in great shape, worked hard to calibrate their stocks, taking into account supplies still coming from China. .

Then, when the surge caused by the Delta variant took hold in August, there was intense competition to balance inventory due to extreme competition from Chinese companies selling unregulated products well below cost. Even now, as the United States faces the next variant of Covid-19, Omicron, the medical supplies industry is acting more cautiously and thoughtfully regarding inventory management and reordering supplies. My colleagues in the testing industry tell me they are taking a similar, cautious approach.

The factors driving the demand for testing materials are varied and complex, complicating supply chain issues. The need for testing supplies is affected by the mix of products available as well as the timing of new market entries, such as SARS-CoV-2 oral antivirals and booster shots. Even the prevalence of other viruses, such as influenza, RSV and the common cold-causing adenoviruses, may increase the general demand for testing, as there has been an increase in these conditions, especially in children (the same supplies used for Covid-19 can be used to test for other viruses).

For example, many schools now require students who have been discharged due to Covid-like symptoms, which may overlap with those of influenza, RSV or adenovirus, to have a negative Covid-19 test result before to go back to school. Some schools are also implementing “test to stay” policies where students can attend in-person classes as long as they test negative every day. Many students no longer have distance learning options, so having quick access to tests and quick results is important for them.

On top of that, with the Supreme Court’s new decision on vaccination mandates, the private companies of millions of people who choose not to get vaccinated can set their own requirements for regular testing instead of vaccination – and many may choose to do so.

Although the federal government invested in Covid-19 testing and supplies through the Defense Production Act early in the pandemic, the follow-up has not supported a long-term solution to the problems associated with Covid-19 testing supplies and the entire medical supplies industry. The supply chain issues that Longhorn and other testing and medical supply companies have encountered during the pandemic underscore how important it is for the federal government to dramatically expand U.S. manufacturing capacity. for testing and medical supplies through long-term investments and policy decisions. This is especially important as the country adjusts to the reality that Covid-19 is likely to remain a long-term public health issue.

Not only would increased federal investment in a national supply chain for medical supplies provide access to critical equipment in times of crisis, but it would also reduce transportation delays, allowing for faster response while ensuring greater oversight. regulatory and quality control by the Food and Drug Administration.

As new strains of Covid-19 continue to emerge and experts warn of the increased frequency and severity of future pandemics, the need for such investment is reaching a critical level. As difficult as this pandemic has been, the United States can use the crisis as an opportunity and the microcosm of the testing supply industry as a teachable moment, to better prepare for the next one, minimize our losses and provide American citizens with the best – and fastest – response possible. Without a sustainable American industry, the country risks finding itself again in a situation of health crisis without access to basic and necessary supplies.

Jeff Fischer is the president of Longhorn Vaccines and Diagnostics, based in Bethesda, Maryland.


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