The Demand Rollercoaster

The pandemic may well prove to be one of the biggest challenges in modern history – especially from the perspective of the pharma industry and specifically with regard to how fast it could react to the outbreak and develop an effective vaccine.

In just over a year, the industry has reached impressive milestones in terms of vaccine development – bringing eight fully approved vaccines to market though vastly accelerated timescales. Key to this success are the extraordinary levels of collaboration between international governments and the global pharmaceutical community. We saw the pharmaceutical industry repurpose existing market-ready medications for experimental cures, and we continue to see research being conducted to find other novel solutions to COVID-19.

Impact on supply chains

One of the biggest challenges experienced by Roquette is the changing swing in demand for certain raw materials and products. In the early days of the pandemic, for instance, we saw a significant spike in demand for OTC products because of consumers stockpiling supplies. Raw materials, such as liquid polyols (used in cough syrups), were in very high demand during the first half of 2020. Due to the impact on the respiratory system by COVID-19, demand for powdered polyols – used in coatings for smoking secession gums – was also up, alongside tablet fillers, binders, and disintegrants that were being used in various experimental cures. However, if a possible new treatment was deemed ineffective, demand abruptly dropped. We’ve had to work very closely with our customers to ensure we could react to changing requirements.

The opposite was true for vaccine development. Here, there was a much more gradual increase in demand. But to be able to scale from small volumes for preclinical trials to very large volumes of raw materials needed for commercialization, it was crucial that we work closely with our partners to understand their needs and expand capacity accordingly. Today, we continue to see significant demand for our biopharmaceutical excipients, which can effectively stabilize vaccine formulations.  

A further ongoing challenge is ocean freight. As demand for goods continues to experience unusual consumption patterns, there is a shortage of sea containers. With plants across the world, we’ve been successful in minimizing the impact on our customers to a certain extent. Although, in specific cases, ensuring on-time delivery has been almost impossible. The importance of keeping communication lines open to ensure customers know the exact status of their order has been amplified by the pandemic.

In such a highly regulated industry, change cannot happen without the necessary qualifications – which could take several months. To that end, any adaptations we made were mainly in relation to logistics and building stockpiles, including the adoption of air freight if delivery by sea freight meant that products wouldn’t be delivered on time. Of course, this had greater cost implications, but the timely distribution of these materials is essential for many customers.

Seeing the good

Despite the tragedy brought about by COVID-19, the positive reaction by the pharma industry has been truly remarkable – with many companies demonstrating ingenuity and speed. We’ve seen many examples of pharma companies quickly reconfiguring their operations to start producing products that are in high demand. This ability to repurpose capacity provides a model for business agility going forward. In addition, the power of collaboration has been exemplified – partnerships forged across all areas of the supply chain enabled the industry to react as quickly as possible in unprecedented circumstances.

Will the industry go back to normal when the pandemic is finally over? It’s likely that it has prompted a response from the pharmaceutical industry to re-evaluate business continuity plans for the better. Although the industry is largely risk averse, with many companies holding sufficient inventories in case of supply interruptions, the EU and some countries, for example, Canada, are already undergoing serious review of their drug manufacturing supply chains – assessing the risks and discussing what steps should be made to reduce those risks in future. 

Working in this industry, you always have the notion in the back of your mind that your efforts are contributing to something bigger – that you’re helping to sustain and save lives. The pandemic has emphasized this even more. Our team is proud to be able to make a difference – not only to helping family, friends, and loved ones, but also the rest of the world.