The Boyd Company: reshoring in the American pharma industry
Covid-19 has exposed large vulnerabilities in the pharmaceutical supply chain within the US, this has prompted some organisations to relocate portions of their supply in an attempt to plan for the unexpected in the future.
With a huge spike in the requirements of PPE, test kits, and drugs, The Boyd Company has pinpointed a weakness in supply chains dependent on offshore suppliers. This weakness is also an opportunity for the 12 states that contain the 25 East-Coast cities Boyd has identified as well-positioned to benefit from this new wave of local pharma investment.
According to Janet Woodcock, Director - Center for Drug Evaluation and Research, only 28 percent of the manufacturing facilities making APIs to supply the U.S. market are based there. Leaving 72 percent of active pharmaceutical ingredients sourced from overseas, the pandemic has shed a harsh light on the risk of relying too heavily on overseas suppliers. Another stimulant for this move is the predicted volume of the anticipated COVID-19 vaccine when it becomes available.
According to Boyd, the states set to benefit from this switch in direction are Massachusetts, New Hampshire, Connecticut, New York, New Jersey, Pennsylvania, Delaware, Maryland, Virginia, North Carolina, Georgia and Florida. The cities were selected based on their proximity to regional pharmaceutical production hubs, transportation infrastructure, real estate inventories for development and logistics considerations. Read the full report to find the specific 25 cities they believe will benefit most.
As well as the recent issues brought to light due to the global pandemic, there are also growing uncertainties surrounding tax and trade costs which is causing an increased focus on operating cost structures and efficiencies within the pharmaceutical industry. Ultimately, many businesses would benefit from the reduction of costs and lower disruption possibilities associated with the reshoring of their supply chains.
The Boyd Company, Inc., provides location counsel to leading American and overseas corporations.
