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Logistical Imagination and the Adderall Shortage
Ignoring supply chain chokepoints at our own peril.
After almost three years of cancellations and half-assed ‘covid-safe’ events, the natural order is back. We’ve tossed off our masks to gyrate on the playa at Burning Man. Once-empty restaurants peddle their unattainable, vaunted 8 PM dinner reservations. European travels abound and the kids are back in school (Zoom, appropriately, is down 56%).
We’ve returned! We’re life-maxxing again!
Well, sort of. Even a distracted observer notes escalating tensions with China and Russia-Ukraine (a conflict that reminds us war - like Marvel films - consists of amateurish reboots for a 21st-century audience). These geopolitical realities aggravate supply chains still beleaguered by Covid-19, labor shortages, and inflation. For much of 2021, I observed my father pulling 90-hour work weeks thanks to this chaos. Spreadsheets and conference calls, I surmised, must be the alpha and omega of logistics.
I didn’t understand his career in sourcing when I was young, though I was likely sour his frequent trips to UAE and South Korea materialized few travel trinkets. But as my passion for healthcare fiercened so did our shared context (his employer supplied medical device parts). My father jests that the world hums because of international trade and not uh, Bitcoin.
Energy economist Vaclav Smil, on the other hand, doesn’t traffick in humor.
Acknowledging that logistics has irrevocably changed the market economy and everyday life, Smil gets existential in Transforming the Twentieth Century: “there is little doubt of its most transformative impact to improve human health.”After all, a complex supply chain produces and distributes our cornucopia of diagnostic, treatment, and surgical products. Healthcare products represent 5% of the total logistics volume globally with 15-20% covering the 3PL of pharmaceuticals.
It’s hard to imagine the web of interactions behind the making of a healthcare product. Take the secret life of a nitrile surgical glove:
A box of gloves might take 1,000 to 8,000 hours to pass end-to-end through the supply chain. Roughly 80% of all healthcare items disseminate through primary wholesalers like AmerisourceBergen who vet, repackage, and distribute to retailers, or to Group Purchasing Organizations (GPOs) who use their combined purchasing power of ~6,000 hospitals to negotiate with suppliers. You might eventually pick up these gloves from a CVS or scroll past a box hawked by secondary sellers on Amazon.
For consumers weaned on full-service retail and one-click purchasing, buying nitrile gloves is simply an example of efficient supply chains. But my father didn’t raise me a fool. Superficially productive circulation of information and goods obscures the reality of trade networks levered for the lowest price; cargo pileups at ports; hidden taxes, customs, and fees; fickle vendor relationships resuscitated over email and calls at odd hours.
In biopharma and healthcare, additional constraints saddle American wholesalers and buyers: suppliers must pass a litany of quality assurance inspections and FDA compliance checks. Most buyers maintain a narrow list of vendors due to the considerable risks in sourcing new, unverified partners. Horrifying lapses have occurred in Romania (where public hospitals purchased deadly, diluted disinfectant from Hexi Pharma) and India (Bayer and Merck sourced for years from Ranbaxy, a manufacturer that journalist Katherine Eban accuses of covering up toxic impurities).
My father says healthcare buyers would rather endure cost creep than gamble, though the lack of diversification results in unsettling supplier concentration:
Global shipping logs over the last 5 years, pulled from ImportYeti
Today's import records show a fragile ecosystem of supplier homogeneity, questioning how far we’ve advanced logistics management since its origins in 2200 B.C.
Healthcare’s supplier concentration leaves us vulnerable to economic shocks. Under the dominant paradigm of just-in-time logistics, contemporary firms angle for speed and efficiency. The lowest storage costs and fewest days to sell off inventory. That behavior suits Good Times, per geopolitical analyst Peter Zeihan, but lean supply chains teeter under instability. How could our brittle practices fare against a maelstrom of war, Covid-19, inflation, port pileups, and 5 years of escalating medical product tariffs?
Friends texted me about the adderral shorage asking whether to believe the surrounding alarmism. From my point of view adderral is one of many healthcare products squeezed by failing chokepoints. According to David Hargraves, an executive at GPO Premier, “about 8 to 10 times as many items are in short supply” compared to before the pandemic.
The Good Times lasted so long that we, lemming-like, extended flimsy global supply chains. We understand logistical techniques via increasing layers of abstraction, writes media historian Matthew Hockenberry.Screens and notifications flatten tables, calendars, satellite GPS - all of the managerial and positional technologies that organize global supply chains.
Tucking these massive coordination networks of infrastructure and workers out of sight creates the logistical imagination. We encounter commerce as illusion, its parts hazily simplified into operating systems and APIs.Who cares how products magick at our doorstep or on retail shelves as long as we get our adderall and gloves.
Fanciful thinking stops when we feel the chokepoints of material scarcity. Consider the shortages that could rupture U.S. healthcare. 3 major vendors of intravenous saline - Baxter Healthcare, B. Braun Medica, and Hospira - face constrained supply. Hospitals delay cancer screenings and CT scans from lack of contrast media (injectible diagnostic dye). Manufacturers ballyhoo about helium and neon supply disruptions in Ukraine, gases essential for imaging, pacemakers, and other common medical equipment. Suppliers didn’t anticipate the increase in adderral prescriptions and underproduced its active ingredients.
Unlike nitrile gloves, healthcare and biopharma supply chains aren’t designed for flexibility 🙃. “Medical supply chains are really behind other industries,” says Wallace Hopp, lead author of the National Academies’s 2022 federal report on supply chain resiliency.
To unknot healthcare’s chokepoints requires understanding global trade enmeshed in geopolitical reality. Hopp recommends thicker supplier networks and increasing manufacturing in the U.S. and with North/South American trade partners (see: the Biden Administration’s biomanufacturing initiative). A public database of medical supply chain risks and remedies might illuminate the messiness of borders and regulations.
My father advises me of the relentless difficulty in modeling logistics. Supply chains direct, concentrate, divert, collapse - incoherence and friction hidden by goods in constant motion. Our healthcare supply chains remain fragile, choked, the longer we succumb to the logistical imagination. The delusion that we easily and systematically manipulate space-time, is it worth disrupting patient care?
Behind your prescriptions and medical products is the whirr of conveyer belts. The chatter of workers and the buzzing of the refrigeration trucks.Foghorn blasts. Ships docking. The unloading of containers and pallets. Can you hear it?
Smil, Vaclav. Transforming the Twentieth Century: Technical Innovations and Their Consequences, Oxford University Press, 2006, p. 92.
Eban, Katherine. Bottle of Lies: The Inside Story of the Generic Drug Boom, Ecco, 2019, p. 237.
In Genesis, Joseph responded to Pharaoh's vision of the Nile overflooding and crippling trade/food systems by institutionalizing warehouses. Grain surpluses successfully fed the Egyptian people in the ensuing 7-year drought. H. H. Manchester views Joseph’s mass orchestration of goods, labor, and infrastructure as one of the earliest documented attempts at logistics management.
Hockenberry, Matthew Curtis, et al. Assembly Codes: The Logistics of Media. Duke University Press, 2021.
Toby Shorin touches on “real-time, demand-aware manufacturing” in Life after Lifestyle. Shorin argues that culture, brand, and supply chains alchemize in an almost algorithmic feedback loop, able to swiftly spawn every kind of DTC product. While I agree that (sub)cultural production has become a distribution strategy, Shorin generously assumes the networked synchronicity of supply chains. We once again encounter the logistical imagination. Supply chains aren’t well-behaved machines sensing supply/demand patterns. They have nowhere near Shorin’s described level of automation and tight integration.
“The Pulse of Global Passage: Listening to Logistics,” in Matthew Hockenberry, Nicole Starosielski, and Susan Zieger, eds., Assembly Codes: The Logistics of Media. Duke University Press, 2021.