Ascension and Ramsay Health Care partner on a new supply chain venture
Operating in over 2,000 states across the US, with 153 hospitals and more than 50 senior living facilities under its belt, private US healthcare provider, Ascension has partnered with Australian winner of iTnews Benchmark’s healthcare category awards, Ramsay Healthcare, in a new global supply chain venture.
Through this partnership, the duo will aim to lower healthcare costs whilst enhance its supply chain operations. Combining its purchasing power, the organisations will own the venture in a 50/50 stake, and will look at new ways to improve existing ways of working by harnessing new digital tools to counteract growing challenges within its ordering, tracking, logistics and supply chain operations.
Two Ascension subsidiaries, Ascension Holdings International and The Resource Group, will also work with Ramsay’s International Procurement Office to enhance and operationalise its new global healthcare buying group.
“Ascension is continually exploring new potential opportunities to extend our reach internationally and make healthcare more affordable for those we serve,” explained Anthony R. Tersigni, President and Chief Executive Officer at Ascension.
“As we looked for partners to help us improve the quality and reduce the costs of the millions of items our caregivers use to provide compassionate, personalised care, we were tremendously impressed by Ramsay Health Care, whose values and mission align closely with our own.”
“The mindset has to change from inpatient care to: How do we move away from our campuses and move into the community and move into settings that are easier to access, cheaper, quicker and have the same quality and safety and outcome standards?” he added.
This shift in focus has led to significant cost savings for the organisation, where it has also sought to collaborate with Intermountain Healthcare, SSM Health and Trinity Health on the development of a new non-profit generic drug company, RevCycle Intelligence has reported.
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“The new global healthcare buying group between Ascension and Ramsay will seek products internationally that are able to deliver the high level of service and clinical outcomes that our patients have come to expect,” noted Ramsay’s Group Managing Director and Chief Executive Officer Craig McNally.
“Globally, funders are looking for better outcomes at a reduced cost and it is important that all players in the healthcare system work to meet these expectations. At the same time, technology is advancing rapidly and we owe it to our patients to stay abreast of new developments. This partnership between Ramsay and Ascension will therefore allow us to share learnings, best practice and industry knowledge to seek improved quality and outcomes whilst also reducing costs.”
“We believe that over the next few years, we will create opportunities to both improve financial and operating performance within our respective organisations, as well as providing an alternative supply chain source for independent providers in North America, Asia, Oceania, and Europe,” added John D. Doyle, Executive Vice President, Ascension and President and CEO, Ascension Holdings International.
“The new venture is designed by providers, for providers, with the belief that we can bring greater efficiency, discipline, and innovation to the system, and form more productive relationships with the vendor community, so that all can benefit by making healthcare more affordable.”
Ramsay Health remains at the forefront of utilising new digital tools. Recently recognised for its development of physician app MyPatient+, the organisation has acknowledged the potential of how new technologies can enhance communication between healthcare professionals, leading to a significant improvement in the delivery of patient care.
“We have also recently deployed a new MyRamsay mobile app for our diverse workforce of 30,000-plus people. The app uses AI, instant messaging and other tech to help staff engage with the company and each other, highlighting news, jobs, social activities and employee perks,” CIO of Ramsay Health, John Sutherland informed CRN.
With this in mind, its new partnership with Ascension will work to transform its supply chain operations and drive further quality across its entire operations.
The challenges to vaccine distribution affecting everyone
While it is comforting to know that vaccines against COVID-19 are showing remarkable efficacy, the world still faces intractable challenges with vaccine distribution. Specifically, the sheer number of vaccines required and the complexity of global supply chains are sure to present problems we have neither experienced nor even imagined.
Current projections estimate that we could need 12-15 billion doses of vaccine, but the largest vaccine manufacturers produce less than half this volume in a year. To understand the scale of the problem, imagine stacking one billion pennies – you would have a stack that is 950 miles high. Now, think of that times ten. This is a massive problem that one nation can’t solve alone.
Even if we have a vaccine – can we make enough? Based on current projections, Pfizer expects to produce up to 1.3 billion doses this year. Moderna is working to expand its capacity to one billion units this year. Serum Institute of India, the world’s largest vaccine producer, is likely to produce 60% of the 3 billion doses committed by AstraZeneca, Johnson & Johnson and Sanofi. This leaves us about 7 billion doses short.
Expanding vaccine production for most regions in the world is complicated and time-consuming. Unlike many traditional manufacturing operations that can expand relatively quickly and with limited regulation, pharmaceutical production must meet current good manufacturing practice (CGMP) guidelines. So, not only does it take time to transition from R&D to commercial manufacturing, but it could also take an additional six months to achieve CGMP certification.
The problem becomes even more complex when considering the co-products required. Glass vials and syringes are just two of the most essential co-products needed to produce a vaccine. Last year, before COVID-19, global demand for glass vials was 12 billion. Even if it is safe to dispense ten doses per vial, there is certain to be significant pressure on world supply of the materials needed to package and distribute a vaccine.
It is imperative drug manufacturers and their raw material suppliers have clear visibility of production plans and raw material availability if there is any hope of optimizing scarce resources and maximising production yield.
It is widely known by now that temperature is a critical factor for the COVID-19 vaccine. Even the regions with the most developed logistics infrastructures and resources needed to support a cold-chain network are sure to struggle with distribution.
For the United States alone, State and local health agencies have determined distribution costs will exceed $8.4 billion, including $3 billion for workforce recruitment and training; $1.2 billion for cold-chain, $1 billion vaccination sites and $0.5 billion IT upgrades.
The complexity of the problem increases further when considering countries such as India that do not have cold-chain logistics networks that meet vaccine requirements. Despite India’s network of 28,000 cold-chain units, none are capable of transporting vaccines below -25°Celsius. While India’s Serum Institute has licensed to manufacture AstraZeneca’s vaccine, which can reportedly be stored in standard refrigerated environments, even a regular vaccine cold chain poses major challenges.
Furthermore, security will undoubtedly become a significant concern that global authorities must address with a coordinated solution. According to the Pharmaceutical Security Institute, theft and counterfeiting of pharmaceutical products rose nearly 70% over the past five years. As with any valuable and scarce product, counterfeits will emerge. Suppliers and producers are actively working on innovative approaches to limit black-market interference. Corning, for example, is equipping vials with black-light verification to curb counterfeiting.
Clearly, this is a global problem that will require an unprecedented level of collaboration and coordination.
Disconnected information systems
While it is unreasonable to expect every country around the world will suddenly adopt a standard technology that would provide immediate, accurate and available information for everyone, it is not unreasonable to think that we can align on a standard taxonomy that can serve as a Rosetta Stone for collaboration.
A shared view of the situation (inventory, raw materials, delivery, defects) will provide every nation with the necessary information to make life-saving decisions, such as resource pooling, stock allocations and population coverage.
By allowing one central authority, such as the World Health Organization, to organize and align global leaders to a single collaboration standard, such as GS1, and a standard sharing protocol, such as DSCSA, then every supply chain participant will have the ability to predict, plan and execute in a way that maximises global health.
Political influence and social equality
As if we don’t have enough stress and churn in today’s geopolitical environment, we must now include the challenge of “vaccine nationalism.” While this might not appear to be a supply chain problem, per se, it is a critical challenge that will hinge on supply chain capabilities.
In response to the critical supply issues the world experienced with SARS-CoV-2, the World Health Organization, Gavi, the Vaccine Alliance and the Coalition for Epidemic Preparedness Innovations (CEPI) formed Covax: a coalition dedicated to equitable distribution of 2 billion doses of approved vaccines to its 172 member countries. Covax is currently facilitating a purchasing pool and has made commitments to buy massive quantities of approved vaccines when they become available.
However, several political powerhouse countries, such as the United States and Russia, are not participating. Instead, they are striking bilateral deals with drug manufacturers – essentially, competing with the rest of the world to secure a national supply. Allocating scarce resources is never easy, but when availability could mean the difference between life and death, it becomes almost impossible.
Global production, distribution and social equality present dependent yet conflicting realities that will demand global supply chains provide complete transparency and an immutable chain of custody imperative to vaccine distribution.
The technology is available today – we just need to use it. We have the ability to track every batch, pallet, box, vile and dose along the supply chain. We have the ability to know with absolute certainty that the vaccine is approved, where and when it was manufactured, how it was handled and whether it was compromised at any point in the supply chain. Modern blockchain technologies should be applied so that every nation, institution, regulator, doctor and patient can have confidence in knowing that they are making an impact in eradicating COVID-19.