Challenges and Opportunities for Health Commodities Procurement & Distribution, particularly COVID-19 vaccines

Global Procurement Summit 2021 organized by All India Management Association with support of Ministry of Finance, Government of India, the World Bank and the Asian Development Bank gave platform for discussion and exchange of ideas between senior officials engaged in public procurement at central and state public entities and the key bidding communities represented by manufacturers, suppliers, contractors and consultants. The key objective of the summit was to discuss Procurement as Enabler for COVID 19 Emergency response and come out with recommendations for the way forward.

One of the plenary sessions of the summit on “Challenges and Opportunities for Health Commodities Procurement & Distribution, particularly COVID-19 vaccines” was chaired by Mr. Jeff Taylor, Director, Procurement Division, ADB. The panel of experts for this session included Mr. Vinod G. Pillai, Vice President (Sourcing) HLL Life Care Limited, Mr. Steve Guppy, Director of Procurement, Crown Agents,  Mr. Prashant  Yadav,  Senior Fellow, Centre for Global Development and  Affiliate Professor  of Technology and  Operations  Management, INSEAD, and Ms. Anna Pinto Hebert, Senior Operations Officer, Preventive Services (Integrity), The World Bank.

Mr. Jeff Taylor commenced the proceedings for the session by sharing an overview of how ADB has supported its client in overcoming the challenges related to procurement during the COVID times and mentioned a brief about the opportunities for way ahead. During his address, Mr. Jeff Taylor mentioned that ADB recognizes the severity of the situation and has announced a large assistance package of $20 billion of which 40% is directed toward procurement of PPE.

He further specified that apart from lending money, ADB has also undertaken direct procurement of PPE worth $30 million. Besides these efforts, ADB has also announced $9 billion support for financing the procurement of COVID vaccines. Referring to availability of few different COVID vaccine in the market, Mr. Jeff Taylor stated that ADB is currently struggling in determining the most appropriate vaccine for which it should finance the procurement. He also highlighted the issues while dealing with vaccines manufacturers which included their demand for indemnification from the risks associated with the vaccines and non-disclosure policies and suggested procurement of vaccines that are WHO certified.

Mr Jeff Taylor, Director, Procurement Division, ADB, Manila; Mr Steve Guppy, Director of Procurement, Crown Agents, UK; Prof Prashant Yadav, Senior Fellow, Centre for Global Development and Affiliate Professor of Technology and Operations Management INSEAD, Washington DC; Ms Anna Pinto Hebert, Senior Operations Officer, Preventive Services (Integrity), World Bank, Washington DC and Mr Vinod G Pillai, Vice President (Sourcing), HLL Life Care Limited

The second speaker of the session, Mr. Vinod G. Pillai, talked about the challenges faced by Indian government in procurement of PPE, masks and other necessary coveralls during the COVID scenario. Some of the key challenges discussed included shortage of coveralls for internal distribution, limited manufacturers, restrictions in transportation due to lockdowns, inadequate logistics infrastructure, limited working manpower, among others.

He acknowledged that the prompt response from Ministry of Health and Family Welfare and Ministry of Textiles for preparing   standard   specifications of coveralls that can be manufactured in India to overcome various production related constraints. However,   he   raised   concerns   on   the   logistics capacity   of the   country   to   handle   the   surged demand and suggested strengthening of the supply chain network for being prepared to tackle any such scenario in the future. Finally, Mr. Vinod G. Pillai also shared his views on the benefits of e-Procurement systems like GeM in dealing with COVID situation. He suggested that these systems should be more flexible based on the need of the hour and have a provision of penalties in case of delays of supply.

The next speaker of this session, Ms. Anna Pinto Hebert,   talked   about   the   World Bank’s   outlook on the emergency   related procurement through a very detailed presentation that covered issues, approaches and some recommendations that could be considered for being prepared to deal with any similar future situation. During her presentation, she highlighted   that  complexities  and  fragmentation in National Health systems, lack of transparency in procurement activities, uncertainty  in expected delivery, increase in fraudulent  activities, among others  were  some  of  the  major  issues  faced  by various government agencies in the emergency related procurement.

She further   explained   that   to   deal   with these issues different approaches were adopted in various countries. Some of these approaches included preparation of a standardized guideline, fixing the weak links in the procurement process and strengthening the key institutions. She then elaborated on the concerns raised by the private players in dealing with the emergency procurement. In the end, Ms. Anna Pinto Hebert concluded by stating that attention to rules and procedures to prevent corrupt practices is important but also review of the program management systems and engaging technical expertise during the procurement is much more important for minimizing the issues arising due to emergency related procurements.

The next speaker of the session, Mr. Steve Guppy shared his insights on the “Practical Experience of COVID Vaccine Logistics”. He focused his presentation on the five key learnings that were crucial while dealing with the delivery of the COVID Vaccines. These learnings were captioned as i) a race against the clock, ii) external temperature control, iii) expect the unexpected, iv) strong cross-party relationships and v) vaccines can’t beat COVID alone. He elaborated each point in detail and highlighted various logistics and supply chain related challenges faced by Crown Agents in delivery of the COVID vaccines.

During his address,  he  highlighted  that  the  need of meticulous end to end planning and route risk management to  ensure  optimum   delivery  within the  expected  arrival time.  He also mentioned the importance of maintaining an optimum outside temperature to ensure that the vaccines do not get spoiled. He shared an example of how GPS and temperature-based tracking of these packages helped in timely shifting of a package before it got ruined. He also mentioned the challenges involved in transportation of the vaccines from one place to another. He concluded his presentation by stating that the COVID vaccines are neither simple to move nor impossible to disseminate and it needs all the ingredients of supply chain to blend together for making it work.

The last speaker of this session, Mr. Prashant Yadav shared his views on “Challenges pertaining to supply chain and   procurement of COVID vaccines”.  He mentioned that  many  countries  are still uncertain about  which vaccine candidate to invest in, how to purchase  an  optimal  portfolio  and  what  auxiliary items should  they procure. He then elaborated on various vaccine platforms and probability of their success.   He further   explained   the   definition   of optimal portfolio and stated that it requires deep understanding of the correlation in the probability of success across platforms and for vaccine candidates within each platform to determine an optimal portfolio.

Mr. Prashant Yadav also talked about the role of technology  scanning   and   portfolio   approaches in new  technology procurement and  stressed  on the  need  of analysing the  demand/ forecasting  to prepare  an optimal  procurement strategy.  He also mentioned that   there   are governments around the world who are facing challenges in identifying the locus of procurement and shared his views on whether a government should contract for fill and finish manufacturing capacity. He also stated that for ensuring a smooth supply chain management it is important to revisit the standard trade-offs between Responsiveness, Agility and Cost Efficiency.

After the final presentation, the panellist responded to a few questions   raised by the audience.  The session concluded with a final vote of thanks from the chairperson Mr. Jeff Taylor, Director, Procurement Division, ADB.