(Illustration by iStock/MaksimYremenko)
The COVID-19 pandemic has posed unprecedented challenges in the distribution of health products to those in need. Price surges and gouging practices have made many products newly unaffordable, particularly to vulnerable populations. Travel restrictions intended to reduce COVID-19 transmission have constrained distribution of essential medicine. People with special needs and chronic conditions have been further disadvantaged as supply chains for medicine and essential products are disrupted by lockdowns and panic buying.
Across the globe, rapidly scalable innovations in distribution are urgently needed to ensure high-quality, essential products are available, accessible, and affordable for all. In the early stages of the pandemic, governments in Taiwan and South Korea launched a number of efforts to ensure widespread and fast access. In our research we found that many government initiatives that scaled quickly included strong collaboration with private enterprises. Their joint efforts addressed three major areas of a crisis response to the wide-scale provision of health products: increasing manufacturing volume, changing policies to ensure widespread consumer access, and optimizing and coordinating distribution.
As nations grapple with getting health products to those who need them to bring COVID-19 under control, the early efforts in Taiwan and South Korea may offer valuable lessons.
1. Ramping Up Manufacturing Volume
Large purchasing agreements can help increase production commitments. Health markets often fail to produce the right products, at the right time, in the right places, at the right prices to optimize outcomes. Crises like the outbreak of COVID-19 can exacerbate market failures in a number of ways; for example, demand for products can rise quickly but the duration of increased demand may be unclear to suppliers. In this context, government commitments to purchase large volumes of products can help private manufacturers minimize the risk of increasing production, helping match supply with demand.
To secure supply and recognizing that purchasing commitments can help manufacturers increase production, governments in South Korea and Taiwan made large purchases of quality-assured face masks from local manufacturers. In South Korea, the government promised to purchase 50 percent of all masks produced by 130 local manufacturers. In Taiwan, the government mandated that all masks produced locally be sold to the government, and bought the masks at an increased price. As part of this agreement, the government purchased additional machinery for private manufacturers, in exchange for 1.2 million free masks and the ability to purchase an additional 3.8 million at the agreed-upon price. Sending a clear demand signal to suppliers may help rapidly increase production while minimizing risk to private enterprises. These mechanisms can create a win-win for governments' public health goals and private enterprises' business needs.
2. Changing Policies to Ensure Widespread Consumer Access
One of the most important roles governments played was in issuing new regulations or updating existing policies that might hobble efforts to quickly, extensively, and efficiently distribute health products. And businesses demonstrated a willingness to adjust their products and services for the sake of everyone's health.
Mandating equal access can prevent hoarding. Previously, sales of masks to the public were not rationed. As fear of COVID-19 rose and demand for masks grew, the potential for consumers to hoard masks could have increased, leaving some without access to preventive products. To reduce inequities in access and optimize widespread use of masks, governments in Taiwan and South Korea mandated the number of them that could be sold to each individual every week. In Taiwan, each person had the right to obtain three masks. In South Korea, each person could buy two masks per week. Rations were linked to national identification numbers, and in a rural region of Korea, provisions were put in place to waive the printing fees for the national identification card for vulnerable populations, such as youth, to lower barriers to access. Policy changes to limit purchasing were enacted by retailers, signaling a willingness to shift business practices for the greater good.
3. Optimizing and Coordinating Distribution
A number of collaborative steps were taken to ensure that once the products were produced, distribution to people was safe and efficient. Coordination efforts included partnering with a range of community outlets, and providing businesses and consumers novel visibility into government stocks to help optimize purchasing behavior.
Novel partnerships can expand distribution networks and improve access. Distributing preventive products through health facilities caring for sick people increases the risk that others will be exposed to the virus. Distribution through alternative and widely accessible community settings is critical. In South Korea and Taiwan, governments organized distribution through partnerships with private pharmacies and four large private convenience store chains. In Taiwan, the government set up an online system to pre-order masks called "Face Mask System 2.0." It also enabled pre-ordering through a mobile app called "Health Care Express App - eMask," which allowed convenient pick-up of pre-ordered masks to reduce queuing. With their mask orders in place and pick-up location identified, customers would then gather their products at their chosen convenience stores in the neighborhood at any time during pre-specified days. As most convenience stores in Taiwan operate for extended hours, the system allowed customers to pick up their orders when they were best able. Collaborating with different arms of government and the private sector helped ensure products purchased by the government were available at a range of safe locations near consumers.
Sharing government data at the ‘last mile’ can enable consumer safety. In the era of COVID-19, ensuring the availability of products nearby is not sufficient; the process of pick-up can be unsafe if queues increase the risk of COVID-19 transmission. Governments understood that real-time data on face masks stocks could help the public make safer decisions about when and where to purchase products. The South Korean and Taiwanese governments released real-time data on face mask stocks to the public, so that large corporations and private developers could develop mobile map apps to provide consumers information about mask availability, locations for pick-up considered safe, and other features. This allowed officials to monitor the flow of supplies while making it easier for people to get them safely.
Partnerships can help target contributions to areas of greatest need. In South Korea, in addition to supplies received from the government central stock, a number of private corporations donated products to help ensure food security, personal hygiene, health, and mental well-being for quarantined individuals in affected areas. In partnership with municipal governments and district health officials, supplies were assembled into standardized kits containing face masks, thermometer, hand-sanitizing gel, biohazard bags, food, water, personal hygiene products, accessories, and encouraging messages. The kits were delivered by local public health officials to individuals in quarantine. A related mobile app developed by the Ministry of Interior and Safety allowed isolated individuals to communicate with government officials to measure symptoms and request additional supplies. Collaboration enabled private donations to be standardized and distributed to those in need with the support of the larger health system.
Stronger Together
Our findings suggest that the prompt response to the challenges of health product access can be enabled by creative cooperation between public and private sectors. As innovations in health product distribution continue to emerge in North America, Africa, Britain, Southeast Asia, and beyond, it is critical for private companies to ask how they might leverage their own strengths and the strengths of municipal, local, and national governments to accelerate progress. Conversely, governments at all levels should think creatively about the use of financing, policy, data, and partnerships with the private sector to quickly scale responses commensurate with the need.
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Read more stories by Yuen Wai Hung, Marina Cortes & Mara Hansen Staples.