- 1 year ago
2 December 2022
When the Covid pandemic hit in February 2020, global supply chains were thrown into chaos as planes were grounded, borders closed and stockpiling exhausted medicines supplies, yet for Viatris Australia, the company found itself in the best possible position to manage the challenges ahead.
While a pandemic is never welcome, its timing could not have been better because just as Covid struck, Viatris completed a new, centralised distribution centre in Queensland that both streamlined its supply operations and almost doubled its storage capacity.
“We were quite fortunate in that we had simplified our business and moved in right at the outset of Covid, and the supply planning that we’d done in advance of that to carry more inventory meant we were in the best position possible when the pandemic started,” Viatris Supply Chain Director Karl Pfeffer told MedNews.
“We took over the building in February 2020, so we really just finished in time.”
Pfeffer said the company had already placed ordered for additional medicines due to its increased capacity, with much of these already in transit by February 2020 while Viatris’ Carole Park manufacturing facility further enabled the company to respond to a sudden change in demand.
“There was a big surge in the March, April, May period of 2020, but Carole Park was backed up by Viatris’ global network of over 40 facilities, which was hugely beneficial for us as it meant we were in control of our own destiny as opposed to being dependent on third parties,” he said.
“Some of the very first things that we shipped were critical medicines identified by governments and the TGA as being needed to support ICUs. There was projected to be huge demand in hospitals at that time, so our first deliveries were to support those stocks perceived as absolutely necessary.
“We managed to keep medicines coming to Australia. We weren’t frontline medical staff, but we took our role in supplying medicines very seriously.
“Because of our size and scale both nationally and globally, we’ve got very good relationships with transport companies and freight forwarders, so it was easy for us to get medicines prioritised for space on ships and planes. If we needed to secure a shipping container, we could do that more easily than other industries.”
From forensics to pandemics
Pfeffer started his career at the turn of the century as a forensic chemist examining equipment suspected of being used to manufacture of hold illegal drugs, but a move to Alphapharm in 2001 as a quality manager saw his career path tack well away from his chemistry roots.
“Viatris is an excellent company to work for with a great culture,” Pfeffer says. “I’ve gone from the quality department to managing the packaging and production departments, which gave me a leg into distribution and supply chain.
“You would never envisage the Head of Quality moving over to working in supply chain if they’d come from another industry, so I’m very fortunate and thankful for the opportunities I’ve had.”
Supply chain management is, in many ways, the “crystal ball” of company logistics, with Pfeffer saying his team looks two years into the future for any factors likely to impact medicines supply.
For example, while the incidence of non-Covid respiratory illnesses dropped to very low levels in 2020 and 2021, the northern hemisphere winter prompted Pfeffer’s team to stock up on key molecules ahead of the Australian winter, which in turn proved to be bad for colds and flus.
When a competitor recently ran short of a particular product, Viatris was once again ready to step in while flooding across regional Australia has presented an array of new challenges this year as medicines compete with other products to be transported across the country following the closure of regional railway lines.
“The diversion of freight from rail to road causes congestion on the road network so we have loads go directly from our warehouse to customer warehouses without having to stop anywhere in between,” Pfeffer said. “Down to the minute, we continue to make medicines available.”
Lessons from the pandemic
When it comes to the future, Viatris continues to “look beyond Australia for what trends are going to affect us here,” says Pfeffer.
“Risk management proved itself in the pandemic and it’s become one of our key management tools going forward,” he said, adding sustainability as another key priority, his team working to meet Viatris’ commitment to reduce its greenhouse gas emissions by 42 per cent by 2030.
“One of the hidden costs within the supply chain is the packaging materials that keep medicines safe in transit. Outside of the consumer space, there’s materials that need to be either minimised in use or recycled. In any given month, we ship more than 40,000 cardboard cartons to our wholesale customers, and every single one of those cartons is recycled.”
Viatris is also looking to have fewer trucks on the road and, for a company that ships 22,000 pallets of medicines each year, Pfeffer says there is a need to maximise capacity in road transport vehicles.
“We work with our wholesale customers to ensure the planning data between their system and our systems align so we don’t touch the product more often than we need to, and we don’t send partially filled containers or partial pallets,” he said. “That means we’re not shipping empty space on the vehicle, which ultimately means fewer vehicles on the road.”