To optimise their efficiency and profitability, next-generation supply chains must be built on a foundation of optimal visibility, Mahesh Veerina, CEO of Cloudleaf, tells Dr Kevin Robinson. Digitalisation tools that provide context, condition, timing and location data of materials and assets may play a crucial role in ensuring the safe and secure distribution of a COVID-19 vaccine
KSR: If I can pick up on the “national” aspect of supply chain safety, there’s a lot of talk about the localised sourcing of materials and ingredients … and avoiding border crossings. Is that something you’ve experienced or a practise that might hinder getting the vaccine distributed?
MV: That’s a great point, you’re absolutely right. The industry is looking at this as a longer-term trend because of the mass disruption that this pandemic has caused for global supply chains. What they found early on was that many active pharmaceutical ingredients (APIs), 80–90% in fact, were coming out of China or offshore manufacturing facilities in India for use in the US and similar markets.
And because of all these transportation links between countries, the pandemic has caused a multipoint failure; hence, the big move towards regionalisation, moving to near-shore or on-shore activities to within the countries in question and securing capacity. Of course, it’s impossible to effect regionalisation everywhere, but it’s certainly being taken very seriously in some geographies.
In terms of vaccines, however, I think it’s pretty difficult not to act globally. We’ve already seen alliances being formed between South Korea, parts of Europe and the US to co-ordinate both seed and bulk production, even considering the geopolitical tension between China and America.
And that’s the bigger picture! In the future, though, we will see the increased regionalisation of production capabilities, APIs and so on, as well as associations being formed between countries.
KSR: In terms of the here and now, though, what does the pharmaceutical industry need to do and how can Cloudleaf help?
MV: We’re certainly trying to play our part in this and contributing to consortium efforts — such as the Biomedical Advanced Research and Development Authority (BARDA) in the US — and the different groups (AstraZeneca formed a partnership with the Indian Serum Institute of India; Gilead, GSK and J&J have teamed up) that are advancing the seamless end-to-end governance of critical resources to optimise the distribution of the COVID vaccine.
And whereas pharmaceutical companies are focusing on R&D, manufacturing and so forth, the role of Cloudleaf’s technology is to digitise the supply chain. Even before the rise of COVID, we were already working on these solutions and outcomes.
Now, we’re engulfed in a perfect storm that’s the result of 3–4 years of developing sensor technologies, the Internet of Things, advanced AI/ML processing solutions and the cloud; all of these digital tools have now matured to the point whereby you can effectively deploy them in an economical way.
So, what we offer is a digital visibility platform. It enables you to monitor, right from your supply source, every transportation link from the factory to final distribution to the end user. You have both continuous visibility of and information about your materials and finished goods, at the product level, such as ambient temperature, shocks, humidity, open/close door events, etc., which are all very important.
All of these parameters are digitally monitored, information is sent to the cloud and then algorithms crunch the data to give you advance notice before something potentially goes wrong. That heightened level of automation gives you more insight and assurance that goods are moving in a secure fashion.
So, that’s the type of technology we produce and, although we’d previously been working with a number of vendors, the COVID pandemic seriously accelerated the implementation of our automation systems by 12–18 months in some cases.
We had vendors saying: “We want to be manufacturing by December and scaling-up by January.” They’re thinking of unprecedented volumes, such as a hundred million doses, which is fine, but how do you monitor all the transportation routes and shipping lanes while doing that?
KSR: Given that these technologies already available and the pandemic has provided a metaphorical a wake-up, was the global pharmaceutical industry caught napping?
MV: I wouldn’t necessarily say napping. They knew they needed to automate and digitise their networks, but had previously focused more on in-factory automation and robotics. But you’re absolutely right, it’s a wake-up call … but not just for pharma. The entire logistics and transportation sector has had to get global and reset its alarm clock!
Much like the millions of people we now see working from home who have had to embrace higher levels of connectivity, video conferencing, etc., industry is now on an irreversible path towards digital transformation. Virtual tools are quickly becoming the norm.
Take e-commerce, for example, many people in the past were reticent to go online and buy stuff. Now, however, they don’t think twice about it and user numbers have increased by up to 30%, for some sites, and there’s an entirely new population of shoppers coming online, who are probably not going to want to go back to the high street experience.
It’s been quite fascinating to watch as many mainstream industries, including the life sciences, pharma, food and beverage, retail, FMCG and the like, adopt digitalisation, and we’ll no doubt see this trend continuing for the next few years.
KSR: Beyond digitalisation becoming part of the new normal, I imagine there are also cost and even environmental benefits to be gained, as well as safety and security?
MV: Absolutely, I mean efficiency is one part; some companies incur huge production losses when a container of vaccines or blood plasma therapies spoils.
That’s a lot of work and a lot of money wasted. Plasma is a rare material; you only get so many litres of it and, when something goes wrong, the repercussions — beyond the bottom line — for both industry and patients can be devastating.
Then, of course, there are a lot of compliance issues, which is an absolute imperative. Whether food or pharma, quality is very, very important in these industries. Again, there is a direct monetary implication here in all of this, besides the safety, security effort and making operations more efficient.
It just reinforces the benefits that automation and digitalisation can deliver, such as being able to deploy more people in higher value activities, including human resources, and that’s a key driver for us.
KSR: So, even during — or perhaps expedited by — COVID, and on the eve of the so-called twindemic, would you say that the outlook for the uptake and implementation of technology such as yours is looking positive?
MV: It would be incongruous to suggest that there’s a constructive aspect of this pandemic but we are, perhaps, one of the beneficiaries. No threat to global health and well-being is a good thing … but it has forced the hand, somewhat, of a lot of companies and accelerated their journey down the path towards digitalisation. As such, it’s happening at a much faster rate and the benefits are immense. So, if there is a positive, it’s certainly that.
Part I of this article is available here.