UK Plans to Create 4-Month Stockpiles of Protective Equipment

UK Plans to Create 4-Month Stockpiles of Protective Equipment

Summary

  • Pharma industry has intimated the British government about the decreasing inventory of critical medicines and advised to buy and store in sufficient quantities in view of Brexit deadline
  • During the mid of the Covid-19 crisis, NHS was under immense pressure due to shortage of protective equipment.
  • The novel coronavirus has taken an incredible toll in the UK economy, and the government must do whatever it takes to hedge against the second wave of the pandemic.

As the coronavirus pandemic spread to over 200 nations, the world has suffered a severe setback and has paid huge economic as well as human cost. The onslaught of the coronavirus pandemic has exposed the healthcare sector in the UK. The world may witness more pandemics in the future and therefore, must beef up the infrastructure to tackle them.

During the unprecedented crisis, UK witnessed an acute shortage of personal protective equipment (PPE), ventilators, and other healthcare systems which are urgently required by the doctors, healthcare staff and hospitals to guard against the contagious virus. UK firms such as BAE Systems (LON: BA.) and Rolls-Royce (LON: RR.) chipped in to manufacture ventilators during the peak of the crisis.

In an effort to combat the coronavirus pandemic, the Department of Health and Social Care is likely to stockpile PPE (personal protective equipment) for use by health and social care workers and other frontline staff from November that could last for about four months.

Protective gear such as face masks, visors and gowns would be procured in sufficient quantities to empower the healthcare staff in combating the coronavirus pandemic. According to UK’s Health Secretary Matt Hancock, UK’s domestic manufacturers are currently capable of providing 75 per cent of the PPE kits required to support the healthcare staff.

What could be the potential reasons for stockpiling PPE?

  • The UK is anticipating a second wave of the novel coronavirus

With more than 40 thousand deaths and 400 thousand plus active cases so far. During the peak of the unprecedented crisis, the British government faced severe criticism as it failed to create an additional stock of vital medical equipment and PPE for the frontline staff in the wake of the coronavirus pandemic. The nation’s greatest asset, the NHS (National Health Service) was under immense pressure due to shortage of protective equipment. The UK government is leaving no stone unturned to combat this virus and strives to empower the frontline staff with PPE to carry out their duties tirelessly.

  • Brexit deadline (31 December 2020) approaching

The UK has exhausted all its critical medical supplies during the unprecedented crisis. According to some media reports, the pharmaceutical industry has notified the British government regarding the decreasing inventory of critical medicines and advised them to buy and store in sufficient quantities. Drug makers fear that if the UK is not able to strike a post-Brexit trade deal with the EU, the procurement of these critical medicines would not be feasible. The pharmaceutical industry is laid out across the UK and the EU. The industry seems to have evolved in the last couple of decades. A hard Brexit could spell disaster for the UK as the disruption of critical medicines and equipment could leave the UK’s healthcare system high and dry.

In the UK, most of the drugs and medicines are procured from the EU. In addition, the UK would not have any transition period to switch to newer policies from existing systems. As the deadly virus is believed to attack the lungs of the Covid-19 infected patient, the demand for medicines used in curing respiratory disorders has risen substantially.

The global pharmaceutical companies operating in the UK have ramped up production of critical medicines which enabled the undisrupted supply of medicines throughout the crisis caused by the pandemic. However, the industry fears the disruption of the supply chain in the case of no-deal Brexit amid the coronavirus crisis.

The British government was therefore advised by the industry leaders earlier to procure and stockpile critical medicines and equipment’s to combat the deadly pandemic and empower the frontline staff and the NHS. The pharmaceutical industry expects the freight carriers and borders gateways between the EU and the UK to remain open at the end of the Brexit transition period in case of much anticipated hard deal Brexit.

However, the British government is fully committed to counter the expected contingencies and has implemented all the checks and balances in place. The novel coronavirus has taken an incredible toll in the UK economy, and the government must do whatever it takes to hedge against the second wave of the pandemic. Historical evidence suggests that the maximum amount of devastation is caused in the second wave of the pandemic. The UK government needs to obtain supplies and medicines as the fear of a second wave persist.

Major players of UK’s Healthcare industry

Let us put our lens through some of the LSE listed companies which have ventured into providing protective gear and equipment to fight against the coronavirus pandemic.

  • Clipper Logistics Plc (LON: CLG)

In the wake of the coronavirus pandemic, Clipper was approached by the NHS Supply Chain for assistance with the provision of PPE kits to hospitals and other care providers during the peak of the coronavirus pandemic. The company successfully managed to establish a dedicated supply chain for the distribution of PPE kits to more than 500 hospitals. In addition, the Company in association with eBay facilitated online delivery of PPE kits to care providers, care homes and other organisations. The Company’s revenue was up by 8.8 per cent to £500.7 million in the fiscal year 2020.

  • PZ Cussons Plc (LON: PZC)

UK supermarkets witnessed acute shortages of hand sanitisers during the peak of the unprecedented crisis. The Company has managed to capture a huge market size in the hand sanitiser market across the UK with Carex being the key growth driver for the company. The company witnessed strong revenue growth during the first quarter of 2021.

US biopharmaceutical company, Merck is likely to invest £1 billion to build a new R&D centre in London. UK’s Healthcare sector has a lot of ground to cover along with the immense potential to grow. The coronavirus pandemic has exposed the medical infrastructure of most of the countries around the world. The coronavirus pandemic has led to the expansion of medical research labs.

 

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