China manufactures the bulk of personal protective equipment used by healthcare providers in the United States. Other countries supplies these equipments are also hit hard by the coronavirus. Healthcare organizations in the United States typically buy more than 2 million N95 masks each month. The shortage of available capacity for production due to factory closures can result in a month long delay in the delivery of N95 marks that are used to protect against the spread of airborne illness. These masks differ from the standard surgical masks as they effectiveness depends on they proper fit and use. Healthcare workers are expected to be trained in the Occupational Safety and Health Administration’s protocols for their use.
In the U.S. only two companies, 3M and Prestige Ameritech, manufacture the full line of N95 respirators. Historically the production of these masks within the U.S. has been insufficient to cover domestic demand. While the two companies are ramping up the production, it is expected to take up to a month to catch up with the demand surge.
On February 26 the U.S. Health and Human Services (HHS) secretary Alex Azar reported to the House Appropriation Committee that U.S. has a stockpile of 12 million N95 masks. However, HHS estimated that we will need 300 million masks to cover an emergency and the combined production capacity in the U.S. and Mexico is only 65 million.
To address this gap between demand and supply, measures such a limiting the use of these masks by only healthcare staff who are directly involved in patient care is needed.
In addition to the surgical masks, the capacity shortage is also going to hit pharmaceutical products and medical devices. China produces 100% of the active pharmaceutical ingredients (APIs) for two vital products - penicillin and blood-thinner heparin. Capacity constraints and disruptions in the shipment of these drugs from China will necessitate exploration of alternative options. Food and Drug Administration (FDA) identified 20 drug products that are linked to China through API sourcing or product manufacturing, although these products are currently not in short supply.
From a supply chain management perspective, the disruption caused by coronavirus has resulted in a call for setting an industry-wide higher expectations with suppliers to improve supply disruption notification process, as noted by Chaun Powell, group vice president for strategic supplier engagement with Premier Inc. One could see potential price increases due to the an expanded base for manufacturing critical healthcare products in an effort to limit shortages of medical supplies. Inventory management practices should consider having safety stock in excess of 20% over the peak usage for these critical supplies, asserts Scott Cormier, vice president of emergency management, environment of care and safety for Medxcel. However, Powell notes that the increase in inventory should be gradual so as to avoid putting additional burden on suppliers.
Source: https://www.hfma.org/topics/operations-management/article/the-coronavirus-and-the-supply-chain-what-hospitals-need-to-know.html