Post-pandemic revolution

There has been no escape from Covid-19 – and no avoiding that fact. While the pandemic has challenged every sector of the healthcare market, one of the most visible pressure points has been on medical device manufacturing and distribution. From empty PPE cupboards to ventilator shortages, device manufacturing has, at times, been pushed to and beyond breaking point – both nationally and globally. Supply chains need to be robust at the best of times – and Covid-19 laid bare frailties worldwide. “It would be hard to identify an area where supply chains didn’t fall apart,” says Sandra Rodriguez, a market analyst at Axendia, who labels the pandemic a textbook “black swan event”.

Rodriguez says there is no way to fully predict or prepare for an event like a pandemic, natural disaster or geopolitical unrest. However, the frequency of these events requires contingency plans to improve supply chain resilience, and balance the risks and rewards of globalisation.

Covid-19 has made that as clear as it’s ever been. Disruption caused by the pandemic will result in organisations reassessing their outsourcing models. Rodriguez says that companies must shift from rigid supply chains to more integrated value networks that are both flexible and tightly controlled, necessitating transparent data at every layer of the sourcing, manufacturing and delivery process. Companies should adopt “smart sourcing strategies” that evaluate the total cost and implications of their decisions.

Until now, life sciences companies have been, in general, slow to adopt digital transformation strategies and progress these goals. Rodriguez believes that the Covid-19 pandemic may, however, become a “watershed moment” for the industry. The power of cloud computing, augmented and virtual reality technologies, modelling and simulation solutions, 3D printing, AI, machine learning and robotics could all now come into sharper focus to achieve industry 4.0 capabilities in readiness for the next black swan event.

“Industry 4.0 is a digital transformation journey. It offers the ability to connect equipment, people and products, which in turn generates vast amounts of data in real time,” says Rodriguez.

Integrating advanced planning and scheduling (APS) with enterprise resource planning, manufacturing execution systems (MES) and enterprise asset management provides a complete picture of an operation and any internal or external factors affecting production at any given time. And, as Rodriguez puts it, “Life science companies that were able to visualise their data, and model or simulate Covid’s impact on supply chains or on operational constraints, would have been better positioned to respond to the disruption.”

For example, manufacturers that had already moved to APS would have been better placed to respond to rapid internal and external changes. “These companies were better positioned to optimally forecast, plan, schedule and allocate raw materials, resources and production capacity to meet market demand,” she says.

Connectivity plays a pivotal role in industry 4.0, offering the ability for remote access and visibility of production data. “Prior to Covid,” Rodriguez continues, “that often meant being able to monitor equipment or productivity from another office or building. Maintaining operations during Covid now requires secure and remote access to systems and data from anywhere in the world, and at any time.” The highly contagious nature of Covid-19 and rapidly accelerating R-rates closed down entire sites, halting manufacturing. Rodriguez says sites that were already geared up for virtual management were able to get up and running again faster after lockdowns were lifted.

Inefficient connection

Connectivity doesn’t just affect manufacturing, but other players in the distribution network as well, such as ports and regulatory authorities. This was a particular concern in markets like South Africa, where there is a heavy dependence on imported medical devices and equipment.

Stavros Nicolaou, chairman of the Pharmaceutical Industry Association of South Africa, says that, while the supply of pharmaceutical devices into the country proved relatively robust during the early stages of the pandemic, there were inefficiencies in terms of export restrictions in other countries, as well as delays clearing cargo at ports and harbours.

“Some of the regulatory agencies battled to cope with the new working environment, where you had to prove documentation on a virtual basis,” he says. “So, often there were more delays and inefficiencies on that side than in the supply chain itself.” He says that increased digitisation of paperwork and authorisations would plug some of these gaps in the future.

The emergence of Covid-19 in China – and that country’s early lockdown – highlighted the constraints of complex supply chains for device manufacturing. More broadly, the globalisation of manufacturing and the interdependencies of multiple markets proved problematic as rates of infection gathered pace.

“Outsourcing and globalisation have increased the volume of geographically dispersed facilities and suppliers in the life science supply chain,” Rodriguez says. “This has resulted in increased risk and decreased predictability due to the variability and complexity of the chain, and this increases the impact of black swan events on the healthcare ecosystem.”

As such, one of the consequences of the Covid-19 pandemic may be a return to local device manufacturing. “In South Africa, we haven’t seen our healthcare services overwhelmed like we saw in some European countries,” says Nicolaou, who credits strict lockdowns with easing pressure on the healthcare system, if not the economy. “From an equipment point of view, with ventilators, CPAP and BiPap machines we coped reasonably well. Even so, one of the positives to come out of Covid-19 is that South Africa has now started producing CPAP machines locally.”

However, those machines are not being made by medical device manufacturers, but in collaboration with the auto industry. It’s the kind of diversification seen all around the world as companies reconfigured their lines to produce medical equipment. As in South Africa, UK industrial manufacturers transformed their factories to produce ventilators. At GKN Aerospace, that process involved fast-tracking not only technological transformation but also knowledge transfer. Step-bystep, socially distanced assembly line guidance was provided for viewing on mobile devices.

This movement of consumer and industrial players into medical device manufacturing has been mirrored in PPE production. Prior to the pandemic, some 98% of all PPE used in South Africa was imported. The arrival of the virus on 6 March 2020 – as well as export restrictions and PPE demand in other countries – saw the South African healthcare sector reassess its dependence on imports.

“South Africa has a large mining sector and miners need masks underground,” says Nicolaou. “So, some of the companies that were producing non-medical grade masks for miners repurposed to produce KN95 respiratory masks.”

The response, however, wasn’t necessarily driven by agility or technical capability but by good oldfashioned business sense. “If there is a survival agenda you are likely to act more swiftly,” says Nicolaou. “So, I think that in addition to innovation, we saw survival come into play. The mining industry shut down for many months due to Covid, so companies manufacturing for mining were forced to diversify and repurpose their businesses to avoid shutting down. As a result, we now have KN95 mask production in South Africa – which we never had in March – and it’s the same story with surgical gowns.”

Innovation at play

Elsewhere, innovation and diversification has also been at play. At a community level, digital devices and sensors have been used for telemedicine and remote health monitoring, removing the need for some in-person medical consultations. 3D printing, meanwhile, has been trialled on devices as diverse as breathing aids and life-size mannequins that facilitate nasal swab training for medical staff. In China, one manufacturer used 3D printers to create entire outdoor isolation units for patients.

Nicolaou says this kind of innovation – influenced in part by players from outside the medical manufacturing sphere – will continue to ripple through the sector. “Technology and digitisation are playing an increasingly important role all the time in this industry,” he explains. “AI and 3D printing certainly would have assisted [medical manufacturers during the pandemic], but robotics and AI are not happening at the same rate, extent and pace as we have seen in other industries.”

Looking ahead, he says that as long as these technologies enhance or maintain existing quality standards, they will come into play more and more in the post-pandemic world as companies – and entire national healthcare systems – analyse their Covid-19 responses and plan for future pandemics.

Rodriguez says device manufacturers will use lessons from Covid-19 to improve their systems, reducing risk and boosting agility and digitisation at the same time. “The traditional goal of an MES has been to control the manufacturing process so that you reduce opportunities for error and build product quality. In the new paradigm of industry 4.0, reducing opportunities for error at the line will be important, but not sufficient to safeguard production and supply,” she says.

A smarter, decentralised and more interconnected MES will become an important strategic hub, supporting visibility and collaboration across the complete manufacturing marketplace. “Much like the nerves rely on the spine to connect to the brain, the new technologies included in industry 4.0 need a strong MES backbone to connect and coordinate operations,” she says.

“Manufacturers in life sciences have a real opportunity to leapfrog into the future and leverage modern MES technology that will help them quickly adapt to market demands, while at the same time future-proofing and error-proofing their businesses.”