Sanofi, Sanctions, And Supply-Chain Challenges
By Louis Garguilo, Chief Editor, Outsourced Pharma
We were introduced to Arezou Mehrabi in this editorial.
Now she’s primed to introduce us to a supply chain challenged by geopolitical tensions and trade sanctions, and a Big Pharma (Sanofi) working closely with a CMO to deliver crucial medicines.
The setting is Iran, circa 2018.
Those were the days of Plavix, Taxotere and Depakine, and they were produced in Iran in large quantities.
“The first month on the job I learned production wasn’t going well,” Mehrabi recalls. “We had a lack of finished product, and suddently we stopped achieving our monthly output targets.”
And that is an understatement.
Production Comes To A Stop
A first step for the newly installed executive was to call a meeting with her team at Sanofi, and their long-time contract manufacturer in Iran, Dr. Abidi Pharmaceuticals (Abidi).
She learned that because of the recent U.S. trade embargo on Iran, Abidi was suddenly unable to import from most of the suppliers they had relied on for years – and who were on Sanofi’s list of approved suppliers.
To be clear, the trade sanctions did allow for the importation of items specific to the production of medical products.
Nonetheless, suppliers were hesitant. For example, many of the materials Sanofi needed for packaging could also be used for other purposes and products.
Adding to the strain, Sanofi did not make it easy to change suppliers … in any situation.
“We were at a critical point,” says Mehrabi. “Production was at a stop.”
Because importing materials had never been an issue for Abidi in producing for Sanofi, the CMO had little experience in searching for new, Sanofi-approved suppliers.
“Honestly,” Mehrabi says, “Sanofi didn’t have much experience in a case like this, either.”
At that initial meeing in Tehran, which included the QA head of Sanofi, it was emphasized that these were not common OTC products in shortage, but “critical and potentially lifesaving drugs for patients in Iran and other countries.” Something had to be done.
Mehrabi assured the group they could find new suppliers, and she had a plan.
Convincing Suppliers To Help
Even though Sanofi typically provided its external partners with a list of the top suppliers they should work with, Mehrabi knew Sanofi maintained a much larger database of approved suppliers, although some had not been used in years (if ever).
The first priority, she told her team and Abidi’s, is to scan that database and contact the suppliers farther down in priority, but who could potentially produce the materials in need.
“Because our current suppliers have stopped working with us,” she reasoned, “it does not mean all of them will be unwilling.”
“So we dug into the database,” she recalls. “We found potential suppliers nobody at Sanofi was working with at the time. I tasked our BD team to approach them.”
Some of the suppliers didn’t know they were on the Sanofi-approved vendor list – and Mehrabi had to personally assure them they were.
The biggest challenge, though, was that most of the suppliers feared being accussed of breaking the U.S.-imposed embargo. Many replied, says Mehrabi, ‘We can’t supply you due to the sanction.”
For example, Mehrabi recalls the need to find a supplier of PEG (polyethylene glycols), a component in raw materials for many pharmaceuticals.
Suppliers refused to ship to Sanofi Tehran because they said they could not prove the material would be used for medicinal purposes. “We don’t want to go through that hell,” Mehrabi recalls being told by a supplier.
Another example was a specialized aluminum foil for packaging that is moisture resistant.
Suppliers said no thanks, this product is completely banned because it has dual use.
“I told them, 'No, this is for the famous drug Plavix, it is a lifesaving drug.' But most still said they needed to protect their company,” says Mehrabi.
Perseverance Saves The Supply Chain
Perseverence, though, saved the day.
“It certainly took some efforts,” recalls Mehrabi. “Each SKU could include different raw and packaging materials.”
When one supplier actually agreed to move forward, Abidi quickly stepped in to put contracts in place, always based on Sanofi’s commitment the material was only and specifically for manufacturing medicines.
Prior to that final okay, though, there was involvement by Sanofi’s legal department.
Mehrabi says it habitually started with ‘No, not this supplier,’ perhaps because it was from East Europe, or China, or hadn’t been audited, or ever used.
“We had to discuss the details with legal. It took some efforts, but we worked out most of their concerns,” she says.
Ironically, at the same time legal was hesitant, Sanofi overall was urging her to get production going. To say the least, she recalls, it was an intense first few months.
“But all along,” she quickly adds, “I told them we are on it. I could and would fix this.”
“And within about four months, we had the materials coming in, and we were able to get production running. Fully running,” she adds triumphantly.
“It actually turned out to be a learning experience for Sanofi overall."
Which CDMOs Stepped Up?
Who were those savior suppliers?
Mostly, organizations based in (eastern) Europe, and not those that might come readily to mind. For packaging materials, for example, supplies came from producers in India and China.
What about due diligence on the new suppliers?
Mehrabi says for starters, although not on the top of the approved-supplier lists, they were in the Sanofi database as approved, and had been audited.
Additionally, her team worked hand-in-hand with Abidi, and they also received some assistance from Sanofi’s own quality department for due diligence.
“We performed certain material assessments, and closely monitored production runs,” Mehrabi says.
She personally spent countless hours on the plant floor during critical production moments.
“Where possible, we put materials on three-month stability tests. This time, we actually got approval from Sanofi to deal locally with any recalls, but thank god we never had those challenges.”
Those willing-to-help suppliers, in the end, proved reliable.
“We just had to make quick but informed decisions,” Mehrabi concludes. “These are life-saving medicines. We did what we had to do, and safely.”
And that was accomplished in Iran, by a woman taking leadership, in 2018. A remarkable supply-chain story.