Those who are procuring supplies for Covid-19 preparedness and response these days realize why so many countries struggle to protect their front-line health workers and provide critical care for people who fall severely ill from the infectious disease.
Amid the uncertainties of the epidemiology of the disease, and a lot of media attention on worst-case scenarios, the market for personal protective equipment, ventilators and medicine is failing. This is resulting in depleted stockpiles, order backlogs of 4-to-6 months, and significant price increases ranging from 50-to-100 times historical pricing. This ultimately leads to unprotected front-liners and high fatality rates.
The pandemic exposes the vulnerabilities of supply chains in many industries, as laid out in a recent issue brief. For the last few decades, countries have failed to buy into the idea of pandemic planning and stockpiling, causing the lack of protective equipment stocks to meet the surge in demand during disease outbreaks. This is affects health care workers most. In many developing countries, health workers are getting infected and belong to those getting severely sick or even dying.
Interestingly, health security experts have predicted such a market failure for many years. Papers were published about the issue after the 2002–2004 Severe Acute Respiratory Syndrome (SARS) outbreak. Many of us have urged governments and health facilities to build stockpiles and develop intelligent surge capacities to quickly deploy supplies and equipment where needed. What we are experiencing now is an eye opener.
It shows us that money alone won’t fix the interconnected political, technical and public health problems, which are fueling the pandemic. If we can’t protect our health workforce and ensure infection, prevention and control in our health facilities, we fail our populations and patients. We force people into prolonged lock downs to ease the burden on already fragile health systems. A sustainable and scalable approach is required. This includes:
- Political solutions with support from the highest levels of governments, United Nations agencies and the private sector to ease export bans and other government restrictions;
- Evidence-based solutions to ensure allocations of supplies are based on epidemiological trends, country capacity, and country risk profiles;
- Focus on prioritizing frontline healthcare workers;
- Technical solutions utilizing demand forecasts to ensure proper visibility and transparency of needs and allocation of supplies, including deployment of products to the appropriate countries; and
- Alignment of harmonized, evidence-based policies for masks and use and disposal of additional personal protective equipment.
An absence of price and market transparency also encourages a “hot market” with lots of shady offers from middle persons who ask for 100 percent upfront payments and who hide their supply sources, leaving quality in question. This increases the risk that countries and agencies are exposed to low-quality products which give a false sense of protection.
To respond to the need for better global coordination, the United Nations set up the UN Covid-19 Supply Chain Task Force in April 2020, led by the World Health Organization with the support from the greater UN system. The priority actions of the task force to achieve the sustainable and scalable approach described above include:
- Through WHO, develop a dynamic understanding of required supplies via a bottom-up assessment of needs through country-based modeling to provide a robust forecast of overall needs. This will result in validated and aggregated requests funneled up through a digital portal to the task force for procurement and distribution.
- Through partners within the task force, identify all available global sources of supplies and negotiate with suppliers the necessary quantities and pricing. The sourcing mechanisms will be managed by three separate consortia convened by WHO and with the support of UNICEF for personal protective equipment, and WHO for diagnostics equipment, and oxygen and oxygen-based clinical care.
- Manage a transparent allocation mechanism based on WHO clinical protocols, epidemiological needs, available market supply capacity and available funding.
- Through the World Food Programme, establish and manage a global logistics distribution system.
The international community of development partners needs to support this newly set up task force and coordinate supply demand at the country, regional and global level. The new online supply chain coordination portal that the UN Covid-19 Supply Chain Task Force is setting up, will aggregate demand and supply data to inform procurement and logistics arrangements. It aims to be the one platform that all development partners and countries will use to assess their needs and procure supplies. But this requires that everybody commits to transparency, and data sharing. It’s time for UN agencies and multilateral development banks to come together and invest in the public goods of pandemic supply chain management and market shaping.
For a better global coordination to be successful, the UN agencies need to agree on fair administrative charges for procurement services. Many UN agencies need to raise their own income to fund their development programs and serving as procurement agent generates significant income that can be used for these programs. But in the case of emergencies, donors, countries and development partners are then double paying without the security that supplies get delivered in time.
We have all the tools to establish and maintain such a platform and we have the leadership at the UN. What we need now is collective action across development partners and countries to collaborate with this online supply chain coordination portal and share actionable information about supply and demand. In this way, we can all work together towards a fair and timely distribution.
Susann Roth is Principal Knowledge Sharing and Services Specialist, Sustainable Development and Climate Change Department, ADB.
Jesper Pedersen is Principal Procurement Specialist, ADB.