The U.S. Supply-Chain Uncovered: A Superior Search For Domestic Suppliers
By Louis Garguilo, Chief Editor, Outsourced Pharma
The search for supply chain partners goes on. Intensely.
But productively? Are we missing anything? We are about to learn the answer to that is yes.
Drug sponsors are on the hunt for external partners, CDMOs scour the horizon for suppliers, who in turn cast around for material sources.
It's search all the way down.
Despite our operating in an era described as “information overload” and “AI-assisted,” biopharma, CDMOs and the rest of the supply chain reflexively turn to familiar search channels.
Unfortunate for the U.S., those well-navigated routes often lead overseas, and have been for decades.
Even if a Boston-based biotech locates a CDMO in North Carolina, that CDMO contracts for materials in India; the Indian operations order raws from China.
Davis says, “When manufacturers are challenged about not using a fuller domestic supply chain, the reply is, ‘We don't have the materials here in the U.S.’ or ‘We don't have that service here.’”
“But that’s often an all-around misunderstanding of what our actual capabilities are within our country,” he insists. Unless that mindset is corrected, our challenges with domestic sourcing will persist.
I harbor a bit of skepticism here. From a development and manufacturing outsourcing perspective, I hesitate to take his assessment of market misunderstanding on face value.
“So that perspective is exactly where we are stepping in to say, ‘Wait a minute, time out. Capabilities do exit’” he retorts. “Improved searches and databases will uncover what might be right in front of you.”
This great uncovering is why Davis and company created CONNEX Marketplace, a digital, industry-agnostic platform connecting manufacturers, buyers and sellers in the U.S. (Also see here.)
“If capabilities or capacity are in fact not matured, let's talk about fixing that – that’s a different issue,” he says, addressing my wariness, "and if there's an actual gap within our country, that’s another issue. Let’s work on that.”
“But there are untapped capabilities and unrealized opportunities to work with domestic suppliers,” and CONNEX has been proving that is accurate.
It is our search attempts, our attitudes, that need to better align with this reality.
Moreover, Davis says, “the big argument that it’s more costly in the states versus overseas has also been challenged sufficiently now for people to understand that's not necessarily a barrier.”
“The barrier is the mindset, to be honest.”
Minds, Materials, And Manufacturing
Changing minds is arduous work. Changing behaviors practiced by a collective biopharma industry doubles the effort.
“When we started our company, we were looking to solve a very focused, domestic-sourcing problem; we have stayed true to that calling,” says Davis.
“Long before the current politics – before COVID and tariffs and the like – this has been our mission and we have proven repeatedly there has been a loss of understanding about what is available in the U.S.”
I’d suggest any misconceptions are a product of some realities:
No antibiotics suppliers here; generic and hospital supplies at chronic risk; baby formula manufacturing crises; COVID-induced drug-shortage shocks; and on and on.
Davis doesn't shy away from the statistics, and in fact lists some of his own from memory:
“Going back to the early 2000s or so, throughout the U.S. we closed 78,000 manufacturing facilities of all kinds. Six million jobs were lost. We decimated our production and our manufacturing to our own detriment.
“That is the reality. It is the challenge we are solving for. But we are also working to overcome what happens when that reality turns us away from ever again seriously looking for new sources and opportunities in the U.S.”
Davis and company collaborate with groups such as the Small Business Association (SBA) and the Make Onshoring Great Again portal.
“Many are aware of this challenge, and desire to reverse the situation – today there is a palpable feeling we can do this," he says. “Strategic supply chains for most all industries must remain in the U.S., and with a dedicated domestic search, they can.”
A Domestic Convincing
The more I listen to Davis (and throw off my reflexive responses), the more I appreciate his sanguinity in the face of our domestic challenges.
I think about the daily press releases I receive from CDMOs and suppliers around the U.S. announcing capacity, capabilities, additional facilities, and new alliances and leadership.
Biotechs in San Francisco – with the proper mindset – can facilitate development programs with any number of CDMOs across this continent. Big Pharma – Lilly immediately comes to mind – is pumping investment dollars into existing and new facilities in the U.S. Most all Pharma today at least talk of utilizing U.S. suppliers to the extent possible.
And I can make some of Davis’ case for him. We are not saying every capability/capacity exists somewhere in the U.S. at this moment, nor can every overseas supply chain be replicated domestically.
But it’s a shame to conclude prematurely that domestic options for materials and services do not exist – when they very well might.
Davis says his organization's CONNEX Marketplace is an improved tool for those domestic searches – we might consider it an attitude changing technology.
There are certainly other options as well; the more these search platforms lead you to domestic supplies and services, the stronger those channels become, creating a positive loop.
Therefore, whether drug sponsor or CDMO, ask yourself: How good is our current search regimen? What is our mindset vis-à-vis domestic suppliers?
"If we spend time truly digging – and it's gotten easier with platforms such as CONNEX Marketplace – and confirm there's a real gap in capability in the U.S., then that too is important. It's now an area we can say with confidence we should focus on."
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Also see: Mission-Driven Professionals And Students Build America's Supply Chains