ML Journal April 2022

ML Journal April 2022

DIALOGUE: Building Resiliency Amidst Disruption

The key to resilient supply chains is the availability of quick and accurate information, believes Sanjeev Sethi, COO of global healthcare company Viatris.

“The pandemic highlighted that we need to improve how we use information to better predict market conditions.”

Sanjeev Sethi, Chief Operating Officer, Viatris Inc.

Formed in the midst of the COVID-19 pandemic in 2020 by the merger of Dutch-based generics and specialty pharmaceuticals company Mylan and Pfizer’s off-patient medicine division Upjohn, US-based Viatris Inc. is now a $17 billion global healthcare company employing 37,000 people and serving patients in over 165 countries via a global production network of more than 40 plants spanning five continents.  

In our latest Dialogue with a manufacturing industry thought leader, Viatris Chief Operating Officer Sanjeev Sethi talks to Manufacturing Leadership Council Executive Editor Paul Tate about the challenges of creating a newly merged company during the pandemic, how timely and accurate information helps create more resilient supply chains, and how a combination of smart connectivity and diligent execution will determine future industry success.

Q: What excites you about your role at Viatris?

A: The most exciting aspect of my role is the direct impact we can have on the lives of the patients we serve around the world. I have the opportunity to work closely with a great team of developers and a talented group of employees and we all understand and appreciate that our industry can have a significant and direct impact on patient’s lives. But at the same time, we must continue to evolve because, quite often, the innovation in our industry only reaches a fraction of the patients in need. As we experienced during COVID-19, the timely availability of the right treatment is a universal need, not just for a select few countries or for a select few populations. All this keeps us motivated and that’s what really drives us.

Q: Launching a newly merged company during 2020 in the midst of the pandemic can’t have been easy. What did you learn from that experience?

A: Absolutely. Launching a new company and integrating the two organizations was not easy during the pandemic. But it really showed us the importance of communication and close collaboration. It taught us new ways of communicating and collaborating because we were not able to meet face-to-face for quite some time.

We’d started the pre-merger process sometime around October 2019 when we had a big meeting with all the parties involved. But after that, the pandemic hit us. So, both legacy companies then had to adjust to a new working environment during the pandemic. This was really new for us because, before COVID, we would never have imagined that, even though our manufacturing facilities obviously had to continue to operate in person, a large proportion of the company would be working from home. That was a very new way of working for all of us.

“Sharing supply chain information is critical to ensure resiliency. But it’s no use if you don’t have actionable strategies that allow you to make effective use of that information to do something.”

 

At the same time, we were building and executing plans to integrate. It was a challenge, but it was also an opportunity to further enhance the way we work together. It allowed people to step up in many ways through close collaboration and continuous communication. We never felt, even if we were not meeting face-to-face, that we were losing any connection between the teams or losing any decision-making capabilities. That helped us to navigate the pandemic, integrate the two companies, and at the same time, continue to deliver products for our patients.

Q: The Covid pandemic also caused massive supply chain disruption. How do you think the pharmaceutical supply chain performed during the pandemic? Do you see opportunities for improvement?

A: The pandemic certainly exposed some weaknesses within many supply chains. Sometimes there was too much reliance on just a handful of producers, even for many essential medicines and vaccines. If just one of those producers experienced disruption, it could lead to drug shortages. But in my view, the pharmaceutical sector overall performed very well compared to many others. There were some examples of drug shortages and disruptions, but these were reasonably well managed and mitigated through cross-border collaborations.

Every company experienced sudden changes in market demand as the different peaks of COVID were happening. In many markets, like the U.S., Europe, and other key regions, there were significant surges in demand, even to the extent of 400 percent above normal levels. Even shipping was a challenge. So, the only way to manage this was by leveraging multiple sites, multiple supply points, while working very closely with global, regional, and local logistics partners to finally deliver products to the end customer.

Q: What did the industry learn from the pandemic experience? Do you see opportunities for improvement?

A: Yes, there were many learnings and many areas of improvement that came out of this period. Covid has shown us that access to medicines for all patients, regardless of geography or circumstances, is very critical. Reliable access to medicines depends on strong, resilient, and interconnected global supply chains, and in my view, no single company or country can meet the demands of all patients around the world. The same applies whether it is a pandemic, natural disaster, or whatever. We will continue to see supply chain disruptions across the globe, and we need to be prepared for those.

The pandemic highlighted that we need to improve how we use information to better predict market conditions. Pharmaceutical supply chains are highly globally interconnected and their key to success is the availability of quick and accurate information. In the end, it’s our ability to better predict which products are really needed, or not needed, in each market that will help us manage any future disruptions.

Q: What degree of resilience to disruption do you feel that you have today in Viatris and what are you hoping to achieve for the future?

A: In Viatris we are always working to minimize disruptions as much as possible for our focused markets or for essential medicines where we might be the sole provider. So, we use a multi-pronged strategy. We setup dual  sources where possible and carefully manage inventory to ensure supply continuity. But during a crisis, needs can change very quickly. We have seen challenges on multiple fronts over the last few years. The only way to mitigate those challenges is by monitoring the situation 24/7 and that’s all about the power of information.

“The pandemic highlighted how truly interconnected our world is. Trying to force an increase in the domestic sourcing of essential medicines often makes it harder to respond to the needs of the patients.”

 

Sharing supply chain information is critical to ensure resiliency. But it’s no use if you don’t have actionable strategies that allow you to make effective use of that information to do something. That’s where the real power of execution comes in.

So, we continually focus on multiple steps along the supply chain – securing raw materials, intermediates, managing APIs and product manufacturing, packaging, warehousing, and distribution. And then, managing inventory across different parts of the supply chain, right from our manufacturing sites down to the end customer. It boils down to forecasting demand with better accuracy, and then in turn, better executing in terms of supply.

We are constantly reviewing our manufacturing and packaging strategy. Today we have global, regional, and local networks of manufacturing sites and warehouses. We also have a network of strategic third-party suppliers. All this helps us mitigate disruptions, manage cost of goods, and also enables us to respond swiftly to local market needs through last-mile distribution capabilities through those local warehouses and distribution centers.

This diversified supply chain approach helped our team manage the pandemic very well. The end result was that we were able to achieve consistently more than 90 percent of customer service levels. I think that was a great achievement for the team. And we need to maintain that, and we need to protect that.

Q: Looking forward, we’re entering an era that some would call Supply Chain 4.0. What does that mean to you?

A: Whatever we do as an industry, the supply chain needs to be flexible. Definitely we will have to enhance the technologies we use so that we can make the best use of data driven intelligence for pre-empting probabilities in demand, and this will help us to adjust our supply planning to minimize the impact of disruptions. This is only possible through networked technologies and high-end digital tools. No one technology will provide all the answers. We will have to use multiple technologies because it’s the blend of technologies that will really make the difference.

Q: Some governments are encouraging more localized, reshoring approaches as a way of mitigating global supply disruptions. What’s your view on that?

A: In my view, closed borders can never be a solution. In fact, it should be the reverse. It has to be a blend of global, regional, and local supply.

The pandemic highlighted how truly interconnected our world is. Trying to force an increase in the domestic sourcing of essential medicines often makes it harder to respond to the needs of the patients. And of course, it can also impact cost.

When borders were closed to control the spread of virus, it further increased the challenges for different parts of the supply chain. As a solution, we don’t have to duplicate production in every country. The only thing that will work is to recommit to strengthening international cooperation and commitment to ensure the free flow of medicines across all borders.

Q: What’s next for Viatris? How are you now planning to reshape the merged organization for the years ahead?

A: In February we announced our vision to create a simpler, stronger, and more focused company. We will continue to consolidate and optimize our operations, balance capacity, and balance the challenges of the supply chain so we can minimize disruption and continue to solve patient’s needs across multiple countries.

“The leaders today who are actively investing in the digital skills, capital, and infrastructure for the future are the ones that will dominate global manufacturing in the years ahead.”

 

From an R&D perspective, we have already successfully delivered multiple complex products and we are constantly working towards moving up the value chain. That means adopting a hybrid strategy, reshaping our internal network, and expanding our collaborative partnerships to develop new kinds of complex and novel products for the future.

Q: You also mentioned earlier about the pandemic transforming the way people work. Do you see that remote working approach continuing in the future?

A: Absolutely. As we’ve seen, the whole industry has been transformed. Previously, we used to be limited to getting talent from a specific part of the country, or a specific part of the world. Now that’s not a challenge anymore. You can be sitting in any part of a country and working for a company that’s based elsewhere. But there are certain ground rules. Certain jobs cannot be done remotely. You cannot imagine that R&D, manufacturing, quality, or supply chain at R&D or manufacturing sites be done from home. These functions have ti done onsite. They have to be in the plant. But then there are many other roles that do not need to be onsite and can be done remotely.  So, this is a new way of attracting talent for us.

Q: What kinds of skills will the next generation of manufacturing leaders need in that new era?

A: If you ask any manufacturing or supply chain leader, everyone will tell you that digital transformation and information availability is the key. Technology will drive competitiveness in the future and companies will have to embrace digital approaches and have a plan to evolve or they will be left behind. Leaders can take that challenge as an opportunity, or they can see that opportunity as a challenge.

Of course, leaders will have to understand and adapt to automation. But while they do this, they will also have to change their mindset because, at the end of the day, even if you have technologies in place, it’s fundamentally about people. So, manufacturers will also have to increase their bench strength with the talent needed to make automation work because new technologies will demand higher levels of skills and more capital deployment. The leaders today who are actively investing in the digital skills, capital, and infrastructure for the future are the ones that will dominate global manufacturing in the years ahead.

Q: Finally, if you had to focus on one thing as a watchword or catchphrase for the future of manufacturing, what would that be?

A: It’s a question of smart connectivity plus diligent execution. These two things combined will really define resilience. While we all agree that data is key, we cannot underplay the importance of communication and collaboration between people.

A skilled and dedicated team focused on diligent execution will always be critical. Whatever technology you deploy, ultimately, it’s the team’s skill to use it and their dedication to really making it work that will make transformation happen at the end of the day. So, to do that, we will have to arm the teams with technologies that connect and interpret the insights which evolve from that analysis. Once we do that, this will result in greater efficiency and improvements in resilience.

FACT FILE: Viatris Inc.
HQ: Canonsburg, PA
Industry Sector: Healthcare / Pharmaceuticals
Revenues: $17.89 Billion (2021)
Adjusted Net Earnings: $4.47 Billion (2021)
Employees: 37,000 Employees
Presence: 165+ Countries
Production Sites: >40 Manufacturing sites worldwide
Website: www.viatris.com

EXECUTIVE PROFILE: Sanjeev Sethi
Title:
Chief Operating Officer, Viatris Inc.
Nationality: Indian
Education: Master of Science degree in pharmaceutical sciences, Punjab University, India
Languages: English, Punjabi, Hindi
Previous Roles Include:
–  Chief Scientific Officer, Mylan
–  Head of Global Injectable Operations, Mylan
–  Head of Global Scientific Affairs, Mylan
–   Head of Global Generics R&D, Mylan
–  Senior Vice President, Head of Finished Dose Technical Operations, Matrix Laboratories Ltd.
–  Deputy Head, Development and Registration, Sandoz GmbH
–  Associate Director, R&D and Regulatory Affairs, Ranbaxy Research Laboratories.
Other Industry Roles/Awards/Board Memberships
–  40 International Patents

Paul Tate

About the author:
Paul Tate is Co-founding Executive Editor and Senior Content Director of the NAM’s. Manufacturing Leadership Council.

 

 

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