According to government data, in 2020-21, the Indian pharmaceutical industry is the world’s 3rd largest by volume and 14th largest in terms of value. India has the second-highest number of US FDA-approved plants outside the US and accounts for 60% of global vaccine production. We are also the largest provider of generic drugs globally and one of the biggest suppliers of low-cost vaccines in the world. But as exemplary as our performance sounds, it is equally grinding to operate the supply chain for pharmaceuticals. Especially during the pandemic, when the world came to a halt, the Indian pharma supply chain was one of the first to not just stand back on its feet, but also transport one of the world’s first COVID-19 vaccines inland and abroad. In our cover story this month, we take a look at this heroic supply chain in the aftermath of the pandemic.
India takes pride in being one of the biggest suppliers of low-cost vaccines in the world. Also, because of the low price and high quality, Indian medicines are preferred worldwide, thereby rightly making the country the “Pharmacy of the World”.
We are also the 4th largest in Asia for the manufacture of medical devices and currently export ventilators, PPEs, diagnostic kits, sanitizers and surgical gloves (2/3 ply) in the ongoing COVID-19 pandemic. The medical device industry in India has the potential to reach USD 50 billion by 2025.
Even though during all lockdown activity, the movement of pharmaceuticals was allowed by the Indian government, there were still a large number of supply chain disruptions that the pharma industry faced. Inter-state movement of medicines, medical equipment and manpower was most impacted, along with the non-availability of ancillary services like packaging and factory-warehouse-stockists connectivity. Labour shortage was another factor hindering the effective working of pharma supply chains.
The outbreak of COVID-19 and subsequent disruptions to the supply chain with China going under multiple prolonged lockdowns, have further pushed the spirit of being selfreliant in India, in particular reference to the pharmaceutical supply chain. Let’s take an overview of how India’s pharmaceutical supply chain is doing two years after the pandemic struck.
AS A RESULT OF COVID-19
Satish Lakkaraju, Global Head – Air Freight and Pharma, Wiz Freight presents an array of shifts that the pharma supply chain post the pandemic, stressing the fact that they’re now more agile and resilient. He says, “Decisions now need to be taken on a daily basis. And now, if a disruption arises in the middle of the night, you have to make a decision at that time only. Secondly, your human resource is not just looking at a source of income in a job. There are now a host of factors that are considered while working at or joining a workplace, security being the top priority. Additionally, the mode of transportation has changed drastically. Earlier people thought that ocean freight is the only way to ship cargo, but now other modes of transport are being explored along with the idea of multimodal logistics.”
Sahil Munjal, Chairman, Pharma Export Council presents the picture of shortcomings as he says, “Major shifts can be classified into 2 broad categories:
- Sourcing of material:- Availability of material & drastic increase in price of material has had a negative impact on business as some small & medium enterprises were forced to stop operations.
- Logistics issues:- Drastic increase in freight, shortage of containers, longer transit route & blank sailing of containers has impacted the timely availability of goods.”
“During the pandemic, some of the products have experienced lesser demand due to focus on medicines to aid COVID treatment. Postpandemic while the demand for other products has increased multifold (actually shockingly high demand), vendor capacities and lead times have thrown challenges in the pharma supply chain. This was bound to happen because most vendors have allocated their capacities towards commodities needed for vaccines,” adds BVR Vijaya Bhaskar, Associate Vice President SCM, Pfizer Healthcare India Pvt. Ltd.
“Supply Chains hover through many variables and the pandemic has added multiple new dimensions to its complexities. There are complex interactions taking place at various levels, from forecasting, sourcing, production scheduling, storage, shipment and data management,” says Sanjay Sharma, Chief Operating Officer, Coldman Logistics, adding that, from a 3PL provider POV, supply chain managers have started looking at vendors and partners and the approach has shifted to be more of a collaborative one.
In totality, “There are cold chain risks, there are operational risks and then material disruptions are also present. Even container unavailability at ports is also a disruption to the entire value chain of drug transportation. So there‘s a variety of things that can pose a risk to your supply chain as things have become more fluid, making the world that we live in very uncertain,” says Vickram Srivastava, Head of Planning – Global Supply Chain, Sun Pharma.
ANALYZING RISKS AND CHALLENGES
Highlighting time and damage as risks to the pharma supply chain apart from temperature excursions, Fabrice Panza, Manager Global Cool Chain Solutions, Commercial Division & GDP Pharma Manager, Etihad Cargo says, “Delays can impact the quality of pharmaceuticals, so every step needs to be managed to the minute. That is precisely why Etihad Cargo, through its dedicated PharmaLife product, constantly monitors lead times and develops contingency plans. To ensure pharmaceuticals are not damaged, we have partnered with global packaging suppliers to ensure we are using the most advanced, safe and sustainable active and hybrid containers.”
This is an abridged version of the Cover Story that was published in the September edition of the Logistics Insider magazine. To read the complete story, click here.