Perspectives

Transitioning COVID-19 Product Distribution to the Commercial Market

By Nicolette Louissaint, PhD, Senior Vice President, Policy and Strategic Planning, HDA

Throughout the COVID-19 pandemic, the federal government has primarily coordinated response efforts with the support of the private sector to develop, produce and distribute vaccines, personal protective equipment (PPE) and therapeutics. While this public health crisis continues, government and private-sector stakeholders are actively thinking about the expected transition of COVID-19 product distribution to the commercial market.

Assistant Secretary for Preparedness and Response, Dawn O’Connell, shared these sentiments in an August blog. Discussing the shift toward commercialization, she noted that, “While the federal government has been pleased to play this role, we have always known that we would not be in this business forever. We have always intended to transition this work to the commercial market and have been planning for that transition for some time now.”

While there is appreciation that the demand for vaccines and products could shift at any moment with the emergence of new variants, supply chain stakeholders are planning for commercialization and managing product movement in the long run. Healthcare distributors along with our private-sector trading partners are well equipped and prepared to maintain reliable and equitable delivery of these vital products — to ultimately save lives.

Further, getting this transition right now will pay dividends down the line. The lessons learned from managing the shift to commercialization of COVID-19 vaccines and therapeutics will be instrumental to responding to future public health crises.

Supporting Distribution During the Public Health Emergency  — and After

Since the start of the COVID-19 public health emergency (PHE) in February 2020, the federal government has operated closed distribution systems for COVID-19 vaccines and therapeutics, with support from HDA members and other companies. This successful model has been a testament to the value of public-private partnerships and the resilience of the pharmaceutical supply chain.

While a portion of the same system still manages the delivery of COVID-19 vaccines and therapeutics, commercialization will provide a longer-term solution, especially after the end of the PHE. Further, since availability of these products is outpacing domestic demand, the private sector is prepared to manage fluctuations.

Distributors are committed to supporting this transition, lending their logistics expertise and capacity to support the supply chain in continuing to meet the country’s healthcare needs. While the entire supply chain and public health infrastructure will be involved, we believe distributors are necessary and critical to achieving a smooth transition. According to the latest HDA Research Foundation Factbook, an estimated 94 percent of all pharmaceutical sales are completed through distributors.

In an issue brief, HDA outlined a series of recommendations to help facilitate the transition to the commercial market, including the need for:

• An integration period that allows distributors to test systems with federal partners, manufacturers and dispensers to ensure they are ready to receive product;
• The federal government to provide insight into the plans and engagement with provider groups in commercialization planning; and,
• Clarification on the reporting requirements that will be in place after the transition to commercialization.

Looking Forward

The transition to the commercial market will require significant coordination between stakeholders across the pharmaceutical supply chain and government, and many outstanding questions remain for manufacturers and the federal government to address. As we prepare for the commercialization of COVID-19 product distribution, distributors are well positioned to support these efforts by further leveraging their logistics expertise, capacity, capabilities and relationships.

For more insight from HDA on the transition to COVID-19 vaccine and therapeutic commercial distribution, click here.

Dr. Nicolette Louissaint serves as the Senior Vice President for Policy and Strategic Planning for the Healthcare Distribution Alliance (HDA). In this role, she leads HDA’s efforts to build policies and strategic approaches to bolster supply chain resilience and reinforce the role of healthcare distributors in the healthcare ecosystem.