More domestic medical supply manufacturing is ‘critical’ for the U.S. : Premier President

Mike Alkire, President and incoming CEO of Premier, joins Yahoo Finance’s Kristin Myers to discuss supply chain management and accessibility of medical supplies and PPE.

Video Transcript

KRISTIN MYERS: Let's turn now to talking about the coronavirus vaccines. We're joined now by Mike Alkire, president and incoming CEO of Premier. So Mike, talk to us about the biggest challenges right now when it comes to access for the vaccine.

MIKE ALKIRE: First of all, let me just say thanks for having me. And I appreciate you all talking about this incredibly important subject. You know, it's really interesting. Earlier this year, the CDC said that it was actually easier to get data from AIDS clinics in Africa than it was to get COVID data from US providers.

And so I think that just sort of highlights the issue as we think about vaccinating our population. We don't have that technology infrastructure, if you will, to do it efficiently. And I think there are a lot of lessons learned from COVID-19 that we can apply to sort of, you know, ideas around how to future proof health care in the US.

KRISTIN MYERS: All right. So I'm seeing two issues as it stands right now, one in terms of distribution. But secondly-- and I know that you were talking about this in some of your notes-- with supply chains. So what's going on at least on the back end when it comes to the supply chain for the vaccine?

MIKE ALKIRE: Yeah, so it's a great question. So one of the things that I think COVID-19 really highlighted was we have an over-dependency on production of products from, you know, both Southeast Asia and specifically from China. And so that, you know, not only goes to, you know, the products that help dispense the vaccine, so think of things like hypodermic needles and cotton swabs and those kinds of things, but other really important things that we need like PPE, face mask covering for the folks who are administering the vaccine, and-- and exam gloves.

And one of the things that US health care created was a very narrow supply chain that had way too much dependency in that region of the country. And I think that it's absolutely critical that going forward, we think of more resilient strategies to include more domestic manufacturing of those critical products and to some degree some more, you know, near shoring production of those.

But that's going to take a lot of effort on behalf of, you know, the US in terms of ensuring that, you know, from a public policy standpoint, we make it more easy for organizations or for companies to actually produce these products domestically. And we have some ideas around how to do that to, you know, include ideas on how to reduce maybe or create some tax incentives for domestic manufacturing, especially, you know, to allow us to compete against countries that have much lower labor costs.

KRISTIN MYERS: You know, Mike, at least when it comes to the supply chain, this is something that we hear about across so many different sectors and industries, not just in health care. I think we had those conversations yet again after we saw that blockage of the ship in the Suez Canal about the fact that these supply chains need to be made more resilient. I know you gave just one solution there when it comes to tax incentives to increase that domestic production. Are there any others to really help make those supply chains at least when it comes to health care and the supplies more resilient?

MIKE ALKIRE: Yeah, we think there's a huge opportunity for data to play a major role. And so one of the phenomenon that occurred, you know, during the pandemic was this-- obviously we had a huge demand-supply imbalance. And what exacerbated it was that at the same time, everybody was trying to stockpile, right?

So you had the federal government trying to figure out ways to get access to, you know, various PPE. You had the state governments trying to figure out ways to get access to the same product. You had health care delivery systems. You had providers. You had the general public.

Everybody at the same time was now in the market to try to get access to some of the similar products. And we think that there is technology that exists that can look at inventories across the entire US health care system and identify, you know, where-- where there are products and where we can leverage sort of a national stockpile, if you will, and dynamically allocate product where it's needed. So that's number one.

Secondly, we think that, you know, we need to be using technology like machine learning and AI to actually do a better job of forecasting what's happening in the event of a pandemic. For example, we learned a lot from what happened in New York City in terms of utilization of PPE.

We were able to build out models and create predictive technologies that our health care systems were able to leverage so that if-- if they saw the similar kinds of surge of COVID patients, then they could understand the amount of PPE and other materials that they were going to need to care for those-- that population. So we think that technology plays a critical role, as well as this infrastructure to domestically manufacture products.

KRISTIN MYERS: And, Mike, your company purchases medical supplies for hospitals and other health care centers. I know we're talking about the back end with the supply chain. You were talking a little bit earlier about the front end in terms of the distribution, how it has been uneven. What is the long-term impact of that? How has that been playing out?

MIKE ALKIRE: Yeah, I think long term, again, you-- you hit the nail on the head. We've got to make sure we've got-- we have strategies that create this resiliency from a supply chain standpoint. We think we need, again, policies to-- to make it more friendly to do domestic production of these products.

We also believe that we need technology on the clinical side, you know. So it's interesting. The US has done a phenomenal job through initiatives like meaningful use to build out electronic medical records. But we don't actually use that data in ways that could very-- very much be supportive of a-- supportive of the country in the event of a pandemic.

For example, we are able to create some machine learning AI algorithms that basically use some of the unstructured data from the electronical-- electronic medical record and create a syndromic surveillance capability which at a zip code level, it could look for surges of the virus or a progression of the disease or identify where hotspots were. And the reason that that was so-- that's so important is if you remember the early stages of the pandemic, we didn't have enough testing to validate where these COVID patients were.

And if we could look at that unstructured data, we could get real-time access to that information and provide that data to public health officials. And they could then create strategies on how to, you know, think about either, you know, opening their states up or closing different parts of the state or, you know, just initiating other ways to protect their populations.

KRISTIN MYERS: All right. Mike Alkire, president and incoming CEO of Premier. Thank you so much for joining us today.