Imagine the challenges MedTech manufacturers face in the middle of a pandemic and a global supply chain race to acquire decreasing medical supplies. Healthcare workers are overwhelmed by the crossfire of countries’ growing competitive strategies to secure the best medical equipment for their nations, resulting in patients doomed to accept unusual treatment and unlikely fates due to the shortage of medical supplies while health specialists are forced to make life or death decisions. A clear review of the SARS-CoV-2, the virus that causes the Coronavirus (COVID-19), short-, mid-and long-term impacts on the MedTech industry and healthcare personnel health and safety amid increasing supply chain competitiveness.
The World Health Organization declared the coronavirus (COVID-19) a global pandemic on March 11; as such, it has affected the lives of millions all over the world. Despite the lockdown, many industries are insulated mainly from economic disruption, including MedTech, logistics, and consumer goods.
With limited material supply and logistic facilities, MedTech companies have been affected by the increased demand for medical products for healthcare institutions. Different hospitals all over the world do not have enough space for new patients, and the rising number of patients has created a backlog in elective procedures. Although industries suffered imminent disruptions, COVID-19 has short-, mid-, and long-term impacts on the medical industry as a whole. Supply chain companies should expect a more reliable and conservative market shift due to the long-term effects of COVID-19 as related industries face challenges associated with banking crises, staff shortages, and slow down.
Despite this, medical supply chain services are considering OEM sales as the best indicator of industry outlook. There is a need to look beyond the OEMs and their customers like hospitals, physicians, and clinics. Due to the coronavirus, supply chain providers in the health sector are shifting their practices to meet the demand of a pandemic. We see an increase in medical staff being shifted to departments to fight the coronavirus. All rooms in hospitals will be changed from traditional uses to treating coronavirus patients. There will be a delay in non-critical procedures shortly.
Short-Term Impacts
As many countries plan to reopen activities and borders, there will be more demand for medical supplies shortly. Vendors of medical equipment and technologies will benefit handsomely from the pandemic as healthcare facilities will fill capacities with new patients. There will be an increasing demand for products like masks, wipes, standard examination supplies, and disposable hospital room products.
MedTech companies will also be required to manufacture more significant numbers of portable testing kits for the coronavirus, cheap or not, and the world will need hundreds of millions to be tested shortly. The growing demand for diagnosing devices across the globe has already plummeted with the US official numbers reaching over 2 million tests across the country. In contrast, no data has yet to be shared by the Chinese government, when the novel coronavirus first emerged.
Telehealth devices and services have already shown to be in high demand during the lockdown in several countries. Is there any financial impact of the increased demand for medical products? Certainly. Companies may get high sales on some product lines and earn many profits. However, the margin of these products is meagre, so we can say that the overall impact will not be exceptional.
In the short-term, demand may be low across the rest of the device industry. Manufacturers of critical components will experience a modest slowdown. Device management executives at OEMs will be responsible for establishing new product development. They will be uncertain about the demand due to rapidly evolving news about the number of infections and disruptions affecting medicines and devices. Thus, they will actively manage stocks. Reorders will take place, though at a slower pace, as OEMs will strive to understand the real impact of the coronavirus on their businesses.
Those managers, who were overseeing new product launches, will also act more slowly. They will be hesitant to make brave moves in uncertain times. The impact of these trends may prove operationally disruptive to medical equipment and technology suppliers.
Mid Term Effects
The suppliers and OEMs of non-critical devices will face tremendous challenges in the future. No area of medicine may be impacted by demand shock as much as orthopaedics. Orthopaedic procedures are critical and have long recovery periods, thus requiring numerous trips to healthcare facilities.
The possibility of numerous connections with providers at institutions handling coronavirus cases will cause potential patients to choose painkillers over surgery. The orthopaedic problem can be compounded by the financial disruption caused by the pandemic. As we know that orthopaedic procedures need long recovery times with the possibility of a recession looming, so workers and athletes fearful of possible layoffs will be hesitant to take more time off for spinal fusions and other necessary interventions.
Long-Term Impacts Strategic
The 2020 coronavirus pandemic may cause OEMs to reconsider their supplier lists. The most well-known diseases of the 20th century are polio, HIV, malaria, and Ebola. OEMs will consider choosing the best suppliers to survive in the face of global health issues in the upcoming years. There may be dual sourcing of critical components. The purpose will be to present a new challenge for smaller and more leveraged companies, battling for subcontracts.
Braving the storm: Stability
As industries navigate turbulent times, so should medical supply chain managers want to consider how best to present their firms to customers. Suppliers may acknowledge that OEMs are dealing with market disruptions. They may be unable to provide accurate information or lead the relationship. Suppliers will be well served instead of complaining about the uncertainty. There may be actions that include more robust client engagement. And, production may be handheld in the traditional way or shifted to some other facilities.
Many countries are struggling to fight against the coronavirus (COVID-19). It is a global fight that has emerged over dwindling medical supplies. It has caused growing competition for medical equipment and tensions between countries over data and knowledge sharing. However, leading suppliers that will step up to the challenge during the current disruption will not only be rewarded for their resilience, but also for their commitment to client retention and growth.
