- support for science,
- data sharing,
- supply chain resiliency, stockpiling, and surge capacity,
- regulatory and reimbursement clarity and flexibility,
- public- and private-sector coordination and communication, and
- minimizing substandard care offerings.
Within these categories, the authors of this paper suggest policy priorities to increase the effectiveness, efficiency, and equity of the HPMI sector and writ large across the U.S. health care system. These priorities call for increased scientific funding to diversify the pipeline for research and development, strengthening the nation’s public health infrastructure, building and maintaining “ever warm” manufacturing capacity and related stockpiles, instituting efficient and effective regulatory and reimbursement frameworks that promote innovation and creativity, devising structures and processes that enable more efficient collaboration and more effective communication to the public, and implementing rewards that incentivize desired behaviors among stakeholders. This assessment draws from the collective experience of the authors to provide a perspective for the diagnostics, hospital supplies and equipment, medical devices, therapeutics, and vaccines segments.
While the authors of this paper agree on a common set of key policies, sub-sector-specific nuances are important to consider when putting any action priority into effect. With thoughtful implementation, these policies will enable a quicker, more robust response to future pandemics and enhance the overall performance of the U.S. health care system.
IntroductionIn the waning days of 2019, global news outlets began reporting on a “mysterious viral pneumonia” infecting residents of Wuhan, China [2]. The first recorded death from what we now know as COVID-19, or the disease state resulting from infection with the SARS-CoV-2 virus, was a resident of Wuhan on January 11, 2020, and the first confirmed case of COVID-19 in the United States was on January 20, 2020 [3,4]. The World Health Organization declared COVID-19 a global pandemic on March 11, 2020, and since then, COVID-19 has claimed the lives of 828,000 Americans and 5.26 million individuals worldwide [103].
Although there were some examples of effective local, state, and national responses, there were critical issues and inconsistencies in the U.S. national pandemic response that resulted in delayed and insufficient availability of testing early in the pandemic, shortages of basic supplies including personal protective equipment (PPE), and strained health system capacity. Even with the advent of efficacious vaccines and therapeutics, COVID-19 and future novel viruses are expected to remain a significant global health threat. Both the direct and indirect effects of the pandemic have disproportionately affected communities of color in the U.S., as the virus has had a much higher mortality rate in Asian and Pacific Islander, Black, Latino, and Native American patients as compared to white patients [5,6,7]. Yet, even as the pandemic reveals or greatly exacerbates critical system fragilities, the conditions of the pandemic have also driven rapid progress in some areas, such as greater acceptance of telemedicine.
The Emerging Stronger After COVID-19 series of discussion papers, of which this paper is one, will examine nine sectors of the health care system, assessing both their existing vulnerabilities and their greatest opportunities for driving system-wide transformation toward effective, efficient, and equitable care for all Americans in the wake of COVID-19 [8].
Major Organizational Components and Interactions Within the Health Product Manufacturers and Innovators SectorHPMI research, develop, and produce a broad range of products and services that are critical to the health and well-being of people in the U.S. and around the globe. HPMI rely on a global supply network to provide components and ingredients to manufacture and operate these critical products and an extensive distribution system to ensure the delivery of these technologies across the U.S. and globally.
Despite the efforts of HPMI aimed at improving and extending lives, the COVID-19 pandemic has highlighted a range of vulnerabilities across the sector. This paper presents an individual assessment of the experiences and dynamics over the course of the COVID-19 pandemic through the lens of five specific sub-sectors — diagnostics, hospital supplies and personal protective equipment, Class III medical devices per the Food and Drug Administration’s (FDA) classification system, therapeutics, and vaccines — to uncover the vulnerabilities and opportunities for sector-wide transformation (see Figure 1). Within each sub-sector’s analysis of its experiences with COVID-19, the authors unravel the challenges each sector faced in continuing operations while responding to the domestic and global demands of the pandemic. Collectively, these vulnerabilities underscore the need for coordinated strategies to ensure the U.S. is well positioned to respond to the current and future public health crises and to enhance the sector’s overall effectiveness, efficiency, and equity. As such, this paper concludes with a synthesized overview of priority actions that will aid in the navigation of future pandemics and other public health crises.
Diagnostics
Overview and Response – DiagnosticsThe diagnostics sub-sector offers a wide variety of products and services, including various diagnostics related to COVID-19. In this paper, the authors focus primarily on PCR molecular diagnostic testing, which is considered the gold standard in diagnosing whether a person is currently infected with the SARS-CoV-2 virus.
The diagnostics sub-sector includes manufacturers of test kits as well as pre-analytical supplies (such as swabs and tubes) and both public and private labs. Public health laboratories perform research, disease surveillance, emergency response support, and some diagnostic and reference testing for the public health agencies they serve, particularly for diseases with significant biosafety risks. Private labs include independent labs, hospital labs, and physician office labs. Some labs develop and validate their own tests that they perform as services (laboratory-developed tests, or LDTs), some labs run tests using manufactured test kits, and some do both. Private labs serve a broad array of customers, including physicians; patients; consumers; hospitals and health systems; employers; managed care organizations; biopharmaceutical, medical device and diagnostics companies; and governmental agencies.
At the start of the COVID-19 pandemic, a particularly prominent response shortfall was the failure to rapidly launch a comprehensive national strategy for the coordinated development and dissemination of tests for COVID-19. Then, in late January 2020, once the U.S. started to develop COVID-19 tests, national health leaders permitted only the use of government-created test kits, which were unable to be produced in numbers sufficient to match demand. Further constraining supply was the discovery of technical flaws in these test kits, which resulted in the decision to halt testing to rectify the issue [9,10,11].
As a result of these shortfalls, and the response to them, dynamics around diagnostics changed in at least two notable ways. The first was the somewhat sudden and widespread public awareness of the vital role diagnostics play in the nation’s ability to understand and track the spread of COVID-19 — as well as to help treat and manage the disease.
Secondly, the U.S. saw a rapid expansion of COVID-19 testing capacity. Within days of the February 29, 2020 FDA guidance creating a pathway for private labs to develop and offer validated COVID-19 tests in addition to state and local public health labs, diagnostics companies responded by bringing tests to market and rapidly ramping up capacity ahead of determinations of payment or reimbursement [12]. Examples of ramping up capacity ahead of payment included purchasing equipment, complex machines, and testing and collection supplies; incurring costs for PPE; and investing in additional site cleanings for protection against COVID-19. Companies that develop diagnostics expanded the accessibility of testing to reach as many people as possible, including health care workers, first responders, the hospital inpatient population, nursing homes, the elderly and the vulnerable, as well as those in underserved communities — through doctors, hospitals, other health care providers, retail pharmacy chains, drive-through testing sites and company websites.
Aside from COVID-19 testing, routine testing for non-acute conditions such as diabetes and cancer was paused during lockdown. Labs engaged with health care industry leaders and technology companies to raise awareness through national, large-scale campaigns such as Stop Medical Distancing [13], a program designed to explain the difference between social distancing and medical distancing to inform people about the importance of continuing to receive timely medical care.
Companies also offered employers and schools services for their return-to-work and return-to-school strategies. For example, certain labs offered return-to-work solutions, including some offerings using medical staff to administer health questionnaires when employees arrived, temperature screening, and specimen collection. One service offered employers access to testing solutions such as an at-home collection test kit, a finger stick antibody blood test, and flu vaccination services. The diagnostics sub-sector also developed novel laboratory-based tests, began offering at-home specimen collection and testing to expand access and reduce demand for PPE, and launched combination COVID-19 and flu tests.
Beyond greater testing capacity and access, new treatments and ultimately new vaccines, two of which have already received emergency use authorizations (EUA) and one FDA approval, are critical. To that end, many of the same laboratories and test kit manufacturers launched antibody tests, and some are providing testing to support COVID-19 therapeutic and vaccine research studies and clinical trials.
Vulnerabilities and Opportunities – DiagnosticsThe increased attention prompted by the pandemic to the need for better testing capacity uncovered vulnerabilities affecting both public and private labs and in how public and private efforts are coordinated to create surge capacity.
As mentioned earlier, at the onset of the COVID-19 pandemic, demand outstripped supply, leading to longer times for people to receive the results of their tests. One of the reasons was due to a focus on government-created testing. There is acknowledgement that involving private-sector laboratories earlier would have allowed for a more rapid scale-up of testing capacity. If labs had begun receiving information earlier, when other countries were facing the crisis, they could have helped earlier [14]. Once private labs were allowed to provide testing under emergency-use conditions, the U.S.’s ability to test for the virus dramatically expanded. The authors of this manuscript believe that engaging both public and private labs early in the national response to COVID-19 would have helped scale up testing supplies and infrastructure more quickly.
The lack of excess capacity at labs, both public and private, was also evident during surges in COVID-19 outbreaks. Despite the sub-sector’s significant efforts in the early days of the pandemic to increase the number of testing platforms available, the complexity of the machines, limited supply of machines and reagents, and staffing shortages made it difficult to scale quickly enough. Estimates of how many tests were needed varied widely [15]. Some experts predicted the need for millions of tests per day. However, some forecasts may have been referring to COVID-19 tests needed for diagnosis, screening and population-level surveillance, including both PCR as well as antigen tests, while others may have been referring to PCR tests, the gold standard for personal diagnosis. In any case, it was not until the Fall of 2020 that the U.S. may have begun to frequently hit 1 million or more diagnostic COVID-19 PCR tests performed per day, according to news reporting citing estimates from The COVID Tracking Project [16,105].
The response to the COVID-19 pandemic was also marked by fragmented and conflicting communication from various authorities and thought leaders. As the public searched for answers during the pandemic, they were confronted with no “single source of truth.” This threatened to erode public confidence and likely resulted in people who did not need testing using up limited capacity [17]. In some cases, patients were unsure who should be tested, which test should be performed, and where a specimen could be collected. Further compounding the confusion was the fact that some doctors’ offices were temporarily closed beginning in March 2020 [104]. As an attempt to mitigate some of these challenges, companies sought to help educate people about where and how to be tested, delivering important COVID-19 information to millions of people through social media, traditional media, and direct email channels, and sharing information with millions more via websites and through trade associations [18,19].
The single biggest vulnerability for the diagnostics sub-sector illuminated during the pandemic is the need for a fuller understanding of, and plan to address, the complexity and multifaceted nature of the global supply chain. While the diagnostics supply chain is often thought of as the test, the machine, and the result, in reality, it entails all the components necessary to collect the specimen, extract it, ship it, and test it — from nasal swabs to reagents, pipette tips, sterile tubes, dry ice, and complex machinery. Announcements of testing capacity based solely on machinal capabilities could be misleading without a reference to dependence upon the availability of necessary supplies. For example, while machines might be able to process a million tests per week, such a claim could be meaningless if there were only enough reagents to process a thousand tests. In addition to understanding that the supply chain is complex and contains many parts, it must be recognized that the supply chain is global. In the beginning of the pandemic, nasal pharyngeal swabs were being sourced primarily from Italy. When Italy was affected by the pandemic, obtaining swabs for U.S. use became a major challenge, not only affecting COVID-19 testing but also routine testing for conditions such as strep throat and sexually transmitted infections. Similarly, shutdowns in other countries such as China strained America’s supply chain.
Finally, while speed is critical in a pandemic, so is continuing to monitor, maintain, and ensure the accuracy and reliability of tests. In the early days of the COVID-19 experience, a number of manufactured antibody test kits of poor quality were left unregulated and flooded the market, only to be withdrawn, further confusing the public and threatening to undermine confidence in tests and testing as a whole [20]. This included confidence in LDTs. Though, unlike test kits, LDTs continued to be regulated under the Clinical Laboratory Improvement Amendments (CLIA). This issue highlights the need for Congress to advance legislation to establish new, transparent validation pathways for all in vitro clinical tests to facilitate the prompt availability of accurate and reliable tests while preventing an influx of inferior products.
Hospital Supplies and Personal Protective Equipment
Overview and Response – Hospital Supplies and Personal Protective EquipmentThe hospital supplies and personal protective equipment sub-sector develops products intended for use by physicians, nurses, hospital personnel, researchers, lab technicians, and others in health care. The sector serves a wide range of businesses including hospitals, clinics, and pharmaceutical companies. Products include a multitude of medical and surgical supplies, such as respirators, gowns, gloves, disinfectants, and sterilization products.
As soon as suppliers of health and safety products across the U.S. learned of the SARS-CoV-2 virus spreading in China in late 2019, they began putting measures in place to prepare. Manufacturers of hospital supplies and personal protective equipment began accelerating production and sourcing of PPE, notably respirators, in early 2020 [21,22]. A heavier than normal flu season was emerging in the Southern Hemisphere in the fall of 2019, portending a similar trend in the winter in the Northern Hemisphere. Signs of the novel and virulent coronavirus, in addition to unfolding natural disasters in Australia and the Philippines, triggered more steps for such manufacturers to prepare as requests for PPE started skyrocketing.
As the COVID-19 pandemic unfolded, manufacturers of hospital supplies and personal equipment were pressured to make appreciably more health and safety products. Global demand for N95 respirators and other respirators far exceeded the supply for the entire industry (rising as high as 20 to 40 times above normal levels). Some companies were prepared to handle normal fluctuations in supply and demand, having built and maintained excess surge capacity for worldwide disease outbreaks and natural disasters. Companies accelerated the process of adding new manufacturing equipment and production lines by diverting engineers, experts, and other resources from other departments to hospital supplies manufacturing efforts [23,24]. However, even with the addition of significant capacity, the unprecedented demand caused by the global pandemic outpaced production and supply.
By March 2020, production faced additional challenges as countries went into lockdown to help stop the spread of COVID-19 and companies halted nonessential operations. Manufacturers of health and safety products and suppliers of key raw materials assessed whether their operations fit government guidelines related to being critical to the pandemic response. Once that determination was made, they implemented safety measures such as those published by the U.S. Occupational Safety and Health Administration (OSHA) to reduce the risk of exposure for their essential employees and continued producing critical supplies such as PPE and hand sanitizer, among other products [25].
To further ramp up production of critical hospital supplies, the U.S. federal government began invoking the U.S. Defense Production Act (DPA) in spring of 2020, which gave the Executive Branch certain authorities to partner with and accelerate domestic industries during national emergencies. DPA authorities were used across several health care sectors including companies like 3M, Hill-Rom, Royal Phillips, and Vyaire Medical.
Health care providers also sought to extend the use of their PPE stocks by conserving respirators through clustering or isolation of patients with the same disease in order to support a crisis capacity strategy of not needing to change PPE after every patient contact. They also reused disposable respirators through decontamination procedures approved by the FDA via emergency use authorization (EUA).
Across suppliers of hospital supplies and personal protective equipment, collaborations played a critical role in the pandemic response. Many companies outside of health and medicine halted supply of their traditional products to supply PPE and other needed supplies for frontline health care workers and first responders. In addition, some initiated collaborations with companies to support the health care industry. A spirit of cooperation developed as hospital supply manufacturers connected with the automotive, industrial, or academic sectors to address various imminent health care needs. These collaborations with other companies to meet global challenges offer a model for potential future innovation.
Vulnerabilities and Opportunities – Hospital Supplies and Personal Protective EquipmentIn the course of the sector’s response to COVID-19, manufacturers of hospital supplies and personal protective equipment faced a number of trade challenges and export restrictions that impeded their ability to more quickly obtain critical raw materials and finished products such as PPE for health care workers and first responders. Access to raw materials was limited due to border closings and slowdowns in procurement, which highlighted the importance of supply chain diversity and resilience. These issues surface opportunities that include a more robust global supply chain, a comprehensive national response plan with visibility into stockpiles, and a framework to promote cooperation and incentivize information sharing sooner and faster during a public health crisis.
Trade challenges restricted the ability of hospital supply and equipment manufacturers to respond even faster during the pandemic. Some governments imposed restrictions on companies exporting the PPE made in one country to customers in other countries [26]. At one point during the pandemic, more than 40 countries imposed PPE export restrictions, and almost 165 countries imposed tariffs [27]. Trade barriers in some countries even extended to raw materials required to manufacture PPE. Occasionally, trading partners would retaliate by erecting reciprocal trade barriers for the same or other products or raw materials. Extensive, interconnected global supply chains in medicines and medical equipment makes this an issue faced by every nation around the world.
Limited supply chain diversity and redundancy among some producers also poses another sub-sector vulnerability. Certain companies experienced difficulty acquiring enough raw materials to consistently meet the needs for their factories. Many worked rapidly and concurrently to hire and qualify new vendors. Some manufacturers assumed additional costs for suppliers’ expansion expenses or to expedite their new production equipment by air shipment. Moving forward, all manufacturers need to ensure that they have a broad supply chain of raw materials required for making health care consumables. Potential issues may emerge if manufacturers do not maintain a broad base of global suppliers, close to their factories, that can quickly increase production of raw materials when necessary. The global supply chain is only as strong as its weakest link, a reality experienced clearly early during the COVID-19 pandemic.
A granular view of what different states and localities needed at which time across the nation was lacking as manufacturers sought to optimize their production and distribution efforts. Some state health systems had adequate supplies and began preparing for future peaks of COVID-19, while others were working to obtain enough supplies for daily operations. Coordinated, national response plans with visibility to national, regional, and local stockpiles could enable a more effective and coordinated response to crises by shifting resources to outbreak hotspots.
Companies are subject to anti-trust laws that prevent them from sharing competitively sensitive information with competitors about their sales and distribution. One tool to help accelerate appropriate information sharing during a crisis is the use of a Voluntary Agreement overseen by the government under Section 708 of the Defense Production Act. This portion of the DPA gives the federal government the authority to work with the private sector to collect information and coordinate the manufacturing and distribution of critical health care products and equipment during a crisis. This can be a particularly effective means to help efficiently distribute PPE across the sector. And the additional certainty, structure, and protections afforded by a Voluntary Agreement under Section 708 of the DPA may help encourage greater openness and provide an incentive for other manufacturers and distributors to participate.
Therapeutic Medical Devices
Overview and Response – Therapeutic Medical DevicesThe medical device industry manufactures a wide variety of products. For the purpose of this paper, the authors focus on therapeutic medical technologies, generally falling into the FDA class III classification.
Therapeutic medical devices are typically devices that are introduced or implanted into the body percutaneously, through a body orifice or minimally invasive surgical incisions. As such, these devices are highly sophisticated and rely on intensive research and development phases, requiring significant time, resources, and financial investments. Having the potential of moderate to severe risk, therapeutic medical devices are subject to high regulatory requirements and require intensive pre-market prospective clinical studies and trials, as well as post-market clinical studies. Operations and clinical procedures involving medical devices may be categorized by a patient’s medical condition and acuity: emergency operations and procedures for life-threatening conditions; necessary, but not urgent, procedures; and elective procedures. The application of these technologies often requires medical device industry representatives’ assistance during procedures performed in hospitals and ambulatory surgical centers (ASCs).
Soon after the onset of the COVID-19 pandemic, medical technology industry representatives experienced a high variability of entry policies implemented by medical facilities to limit the potential of viral spread. These variable policies included SARS-CoV-2 polymerase chain reaction (PCR) or antigen testing requirements along with testing frequency and test sourcing, PPE sourcing (hospital versus medical technology company), representative physical positioning in procedures and operations, and inventory management. These policy variabilities and changing dynamics reduced the number of procedures at some health care systems and complicated the interactions of medical device representatives with clinical staff and patients. For example, some representatives had to source their own PPE due to unexpected changes in hospital inventory levels while also adhering to variable physical positioning mandates. These mandates, or rules regarding personnel access and distancing for representatives, not only varied significantly within hospital settings (e.g., operating rooms, catheterization labs), but between hospitals as well. Inventory management (sourcing, stocking, and maintenance of supply levels) was further complicated early on by changing medical device inventory management between medical technology representatives and hospital procurement and warehousing staff.
In response, many medical technology companies and an industry group (AdvaMed) created their own taskforces to work directly with hospital systems and organizations such as the American Hospital Association and Association of Perioperative Registered Nurses to standardize entry to health systems and procedure/operation participation while ensuring reduced COVID-19 exposure to patient, hospital personnel, and industry representatives.
Many of the hospitals affected by and, in many cases, overwhelmed by COVID-19 have also historically been involved in the execution of clinical studies and trials of medical devices. As early as April 2020, it was widely evident that initiation, execution, and continuation of new and ongoing non-COVID-19 clinical studies and trials were potentially distracting and interfering with the needed hospital human resources that were being repurposed from clinical research to COVID-19 patient management and care. Thus, medical device manufacturers and innovators worked with hospitals, research partners, regulatory bodies, and other relevant stakeholders to:
- assess the impact of COVID-19 on health care research partners and support them accordingly (e.g., reduction in non-COVID-19 clinical studies and in-kind representative support),
- temporarily pause clinical studies and trials where it was determined that local resources would be better allocated to COVID-19 activities,
- convert follow-up procedures (where possible) for those already enrolled in studies to remote methods to ensure participant, clinical site staff, and employee safety while maintaining proper sponsor oversite (via telephone or video conference whenever possible), and to widen the windows for follow-up from that designated in the protocol,
- document COVID-19-related impacts on clinical studies and trials, such as adverse events, COVID-19 diagnoses, and protocol deviations, and
- establish and engage ongoing communication with sites to ensure proper adjustment of activities as the pandemic situation continues to evolve.
To respond to the rapid increase in demand for intensive care unit (ICU) care beginning as early as February 2020, U.S. medical device manufacturers of ventilators and ICU monitoring equipment required over a five-fold increase in production to meet the U.S. and global demands [28,29]. This raised the need for business continuity planning as many of the products required components sourced from suppliers that were overwhelmed with demand. This rapid increase in demand resulted in a wide variety of integrated delivery networks (IDN) and manufacturer responses to deal with the pandemic. In terms of ventilators and ICU monitors, medical device competitors worked together to ramp up production, and non-medical device technology industries contributed by developing new manufacturing lines to provide the critical components needed for ventilator and monitoring equipment.
The COVID-19 pandemic thus produced unprecedented levels of collaboration across competitive manufacturers, where a common goal to fight the pandemic rose above the commercial concerns of collaboration. While engineers were making critical product decisions, the U.S. FDA was essential in streamlining the approval of needed technology to patients suffering from the pandemic by dedicating additional resources to the review process. Some examples included the approval of new non-traditional ventilator component suppliers, such as SpaceX, to provide against the growing unmet demand, and expedited approval of splitter ventilator systems that allowed more than one patient to be supported by a single ventilator [30].
After the initial shock of the COVID-19 pandemic and early adaptations implemented by the health care industry, medical device manufacturers worked with partners to evaluate how to resume elective procedures. To achieve this objective, three essential elements needed to be in place: material availability, people readiness, and hospital capacity.
Material AvailabilityLeveraging the supply chain momentum of the initial phase of the disease outbreak (between February and April 2020), manufacturers retooled supply chain processes by establishing cleaning and testing protocols so that medical testing sites were safe for employees, contractors, and logistics partners. Likewise, new collaborations were formed between various manufacturers and regulatory bodies to meet the rising demand for medical devices such as ventilators. This helped alleviate the fear of working among employees who could have been exposed to COVID-19 and successfully ramped up production in anticipation of demand. On the other hand, to deal with the non-uniform rescheduling and cancellation of surgical procedures in various states, manufacturers partnered with IDNs to determine the potential peak rates and dates of procedures by counties such that factory shutdowns and increases in production could be planned accordingly.
For the full report: https://nam.edu/health-product-manufacturers-and-innovators-covid-19-impact-assessment-lessons-learned-and-compelling-needs/