Coronavirus outbreak highlighted vulnerabilities in medical manufacturing supply chain: Fitch Solutions

With pharmaceutical supply chains under immense pressure due to COVID-19, China's role as a global ingredient producer has come under scrutiny, Fitch Solutions has said

Press Trust of India April 23, 2020 13:32:54 IST
Coronavirus outbreak highlighted vulnerabilities in medical manufacturing supply chain: Fitch Solutions

New Delhi: With pharmaceutical supply chains under immense pressure due to COVID-19 , China's role as a global ingredient producer has come under scrutiny, Fitch Solutions has said.

As per the report, as trade war has heightened discussion over the national security implications of manufacturing new technologies abroad, COVID-19 has highlighted vulnerabilities in the medical manufacturing supply chain, most notably in the US.

Click here to follow LIVE updates on coronavirus outbreak

"We believe that over the longer term, governments may aim to source more key pharmaceutical ingredients locally as opposed to the current heavy reliance on China, and to a lesser degree India," it said.

 <span class=Coronavirus outbreak highlighted vulnerabilities in medical manufacturing supply chain Fitch Solutions" width="380" height="285" class="size-full wp-image-8263411" />

Representational image. AP

This provides an opportunity for the Indian government to escalate domestic production of pharmaceutical ingredients to counteract an over-reliance on Chinese imports now hampered by COVID-19 shutdowns.

Click here to follow LIVE news and updates on stock markets

The Indian government has aggressively begun implementing a policy to ramp-up local output and emerge as an alternate to China, it said.

As well, growing political will amongst major developed economies could encourage governments to offer incentives for companies to re-shore some medical equipment manufacturing.

A large number of active pharmaceutical ingredients (APIs), or bulk drugs, that are used for the manufacturing of drugs are exported from China.

India for instance imports almost 70 percent of its bulk drugs and intermediates from China.

India relies on bulk ingredients from China to manufacture a fifth of the global supplies of drugs that are off patents.

For India, the pandemic triggered raw material shortages and exposed its dependence on Chinese imports.

"Outside India, in the US as of August 2019, only 28 percent of the manufacturing facilities making APIs to supply the US market were in the country. By contrast, the remaining 72 percent of the API manufacturers supplying the US market were overseas, and 13 percent are in China," the report said.

Updated Date:

also read

'Come together to defeat BJP': Mamata Banerjee discusses Oppn unity, Pegasus row with Sonia and Rahul
Politics

'Come together to defeat BJP': Mamata Banerjee discusses Oppn unity, Pegasus row with Sonia and Rahul

Banerjee's visit during the ongoing Parliament's Monsoon Session assumes increased significance with the Opposition cornering the Centre on price rise, increasing cost of fuel and COVID-19 pandemic

US lowers travel advisory for India: Why this change was made and travel situation with other countries
World

US lowers travel advisory for India: Why this change was made and travel situation with other countries

The United States' travel advisory comes as India recorded just 30,093 new coronavirus infections, its lowest in 125 days

Over 3.09 crore unutilised vaccine doses available with states and private hospitals, says Centre
India

Over 3.09 crore unutilised vaccine doses available with states and private hospitals, says Centre

It said that more than 45.37 crore vaccine doses have been provided to states and UTs so far through all sources and a further 59,39,010 doses are in the pipeline