COVID Supply Chains: Fact not Fiction
A little taster for those who want to know the REAL story on SARS-CoV-2
This is from earlier this month:
I thought to share with subscribers, particularly with those who are free subscribers, a snippet from the book. It explains the beginning of the blockbuster era, where this whole mess began, in 1981:
CHAPTER 9 HOW DID IT GET TO THIS?
In 1976, the pharmaceutical company Smith, Kline & French (SK&F) launched Tagamet (cimetidine), an anti-ulcer treatment. The head of the program, Sir James Black, was the first to employ rational drug design in practice, bringing Tagamet to market over twelve years of intense research and development activity.
Five years after the launch of Tagamet, Glaxo launched a competitive product, Zantac (ranitidine), based on a similar compound but produced by a cleaner manufacturing process. Within five years, Zantac was outselling Tagamet 3:1.
This was the first example of clever targeting of physicians to capture competitor markets. It stimulated phenomenal growth in the therapeutic area. Both products became blockbusters on sales of tens of billions of dollars. The beginning of a lucrative strategy for the industry was cast. Glaxo’s formula gets the thumbs up.
Other pharmaceutical companies and their Investors were impressed by what Glaxo had achieved. Even the CEO of SK&F congratulated them on their win.
Armed with this apparently powerful strategic model, pharmaceutical companies resolved to beef up sales & marketing, awaiting compounds coming down the pipe.
Discovery research grew like topsy, as great libraries of patented molecules were required to feed the hungry marketing machine. Expert statisticians and medics were hired to help the marketers frame the messages to doctors. Regulatory affairs departments were expanded to be sure of keeping on the right side of the regulators.
So, the scene was set. Sales & marketing, with their supporting cast, were poised ready for the next blockbuster compound to come down the pipe.
Discovery research was out there, plotting theories on why a molecule would work, modelling and patenting them in great quantities and stuffing prime suspects into the upstream end of the pipe.
In the investor community, however, there was emerging realization that not much was actually making its way out of the pipe. The prospect of being lumbered with huge fixed costs if a drug failed was a serious concern. Coincidentally, during the ‘80s, other sectors were outsourcing ‘non-core activities’, claiming significant benefits in risk reduction, plus lower costs to boot.
That seemed like the perfect solution. Discovery research and marketing were considered core activities. The bits in the middle, running clinical trials, producing, testing, moving, and storing products and materials, dealing with customers using the products, were all classed as non-core…
…and so the cull began. The exact sequence of events isn’t easy to pin down, but the results were unmistakable—masses of workers were shown the door and non-core facilities went up for sale.
Ousted senior executives looking for pastures new put the assets to good use. They set up small companies (SDDs, small drug developers) developing drugs to either sell to Big Pharma or try to get to market themselves.
The CEOs in SDDs were making a persuasive case to be the engine room of drug development, citing less bureaucracy and shorter chains of command. Venture capital (VC) investors liked the sound of it, and started funneling cash in…
…if you want to learn more of how Big Pharma began on this road to bankruptcy, why not taken a look at the book:
COVID Supply Chains: Fact not Fiction
Quote: “This is just one example of the dangerous and deadly-serious supply chain issues that the industry created for itself, by moving to low-cost sourcing from China, India and other Eastern countries. To make matters worse, Big Pharma companies began selling off their manufacturing and distribution assets to third parties, roughly at about the same time—in the early 1980s.”
Available wherever you are, if you have a local Amazon site. It will also help you spread the word and give me a welcome bit of support going forward.
Thanks,
Hedley
Big pharma bankrupt? Sounds like a winner to me.