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Global disruptions are beginning to move beyond energy markets into the supply of essential goods, which raises questions about how resilient Malaysia’s healthcare supply chains really are. Can healthcare systems hold up if disruptions persist? On this episode of #ConsiderThis Melisa Idris speaks with Azrul Mohd Khalib, CEO of Galen Centre for Health and Social Policy.
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00:10Hi, welcome back to Consider This. I'm Melissa Idris. Let's continue our discussion about the
00:15continued supply of essential supplies in healthcare as the impact of the war on Iran
00:20evolves into a global supply crisis from medicines to medical devices. What are the
00:25consequences that disruptions could have for both patients and providers? Joining me on the show
00:31now is Azrul Mahmoud Khalif who is the CEO of Galun Centre for Health and Social Policy. Azrul, thank you
00:37so much for joining me on the show today. Let's start big picture. From your perspective, where do
00:42you see Malaysia's vulnerability in terms of healthcare supply? Thank you, Melissa, for having
00:49me. It's always a pleasure to be on Consider This. You know, this is a very important question for a
00:55lot of us working in the health space right now. Because the biggest vulnerability for
01:00Malaysia is not only in terms of pharmaceuticals or medicines, but also some of the hidden materials
01:07and consumables that we take for granted, or perhaps don't even consider that keep actually
01:12modern healthcare running every day. We talk about dialysers for dialysis, bloodlines, tubing,
01:21syringes, IV bags, catheters, personal protective equipment that was very big during COVID, even
01:30packaging, reagents, and a lot of other plastic-based medical devices. A lot of this is actually not
01:36seen by patients, but very known by those who are running healthcare services. And we know for a fact that
01:45if you don't have this in a way that is sanitary and it's hygienic, then it's going to be a
01:51lot of
01:51compromises on the ability to provide the kind of healthcare that we have come to expect. And many of these
01:57actually depend on petrochemical feedstocks, freight routes, important components, and global suppliers, a whole logistical chain that is largely hidden
02:09from view.
02:10So the Strait of Hormones crisis has actually exposed this logistic change and how we have now come to understand
02:20it or appreciate it really, how a disruption in oil, NAFTA, shipping, or insurance cost even, you know, can quickly
02:28become a hospital supply problem at the local level.
02:32Here in Malaysia, something happening in the Persian Gulf, happening and affecting patients accessing private and public healthcare here. And
02:40we are particularly worried, for example, for the issue of dialysis, especially for those who are having to go through
02:49hemodialysis or peritoneal dialysis patients whose kidneys are failed and are depending on renal replacement therapies.
02:56Because more than 60,000 lesions now depend on dialysis and shortages of any part of the dialysis components and
03:08equipment can not be easily substituted by something else. You know, you really need to have that equipment.
03:14So we are looking at it broadly across the health space and how this is affecting the ability to provide
03:21and deliver quality healthcare services in Malaysia.
03:27Right. Can you talk to me about how those supply disruptions could translate into a real-world impact for patients?
03:36Are we just looking at price increases or is this more about reduced access when it comes to, say, even
03:45shortages?
03:47I think my question is also, who are you most concerned about that will be impacted by any kind of
03:55supply disruption?
03:57Unfortunately, it's not as straightforward as simple because we are seeing shocks across the entire system and it will be
04:04particularly felt by patients themselves, even though it may not seem that way.
04:10For patients, the supply disruption isn't a geopolitical crisis that they watch on TV or follow on YouTube or hear
04:19discussed on radio and it seems very distant.
04:21It actually appears and manifests itself as it may be delayed prescription refill, you know, the refill that they were
04:29supposed to get from the government pharmacy or the private healthcare,
04:34the private pharmacies, maybe a medicine that usually they use would have is now being substituted for something else that
04:42may be less optimal or maybe even inferior.
04:45A higher bill, something that everybody talks about, right?
04:49Price increases, demand continues, but suddenly supply is less, therefore the price goes up.
04:55A postponed procedure, delayed, looking at perhaps things to be deferred to another date,
05:02maybe because the equipment is not there or the ability to actually implement that procedure or that surgery.
05:10There's going to be anxiety, as mentioned just now about dialysis, delayed cancer treatment, surgery or chronic disease care,
05:19all of which, Melissa, can be interrupted at any point of time and it will be felt by patients in
05:27that way.
05:27So, we are looking at some most at-risk groups who are going to be acutely feeling this and they
05:35include dialysis patients,
05:37cancer patients, people with diabetes or heart disease, older people, especially the elderly, very vulnerable,
05:44people with disabilities and, of course, low-income households, you know,
05:48that are not going to be able to absorb a lot of these price shocks or increases.
05:54And those who are needing to travel, you know, from their home to go to the healthcare facility at large
06:01distances
06:01will also be affected because, you know, we are providing medicines not in the community,
06:08but actually depending on them to travel to tertiary care centres to be able to collect their medicines and go
06:13back.
06:13So, there's a lot of this that's going to be felt across the different real-world scenarios for patients
06:21for which, at the end of the day, what we will see is a diminished quality of care
06:26that's being experienced by patients at that level.
06:29Of course, in terms of industry, we are going to see that also payers, the healthcare providers,
06:36even there's a difference between public and private healthcare providers,
06:39they're going to also experience different types of risk.
06:43So, for patients, they are going to feel it acutely in terms of how they experience healthcare.
06:49In what way, Azrael?
06:51In what way would public and private healthcare providers face different levels of risk?
06:56So, there's an assumption here that, you know, if it's going to be something like this sort of crisis,
07:02public healthcare is going to feel it more stronger, more acutely.
07:06But actually, the reverse is true.
07:08What we're expecting is that because public hospitals, they're larger, you know,
07:1470% of the Malaysian population depend on public healthcare,
07:17which is mostly KKM, Ministry of Health-run hospitals, clinics,
07:22and then there's also Ministry of Higher Education, Defence, and so forth.
07:26They have actually stronger central procurement.
07:29You know, they've got their concession systems, and then they've got some buffer stocks
07:33that I think the Ministry of Health has been talking about, maybe like for several months.
07:39And they have all that to their advantage.
07:41But the problem here is that they also have a large patient load, you know.
07:47So, they won't be able to have as much room to absorb, you know, if there's price shocks or increases
07:54in terms of the cost to deliver care.
07:58Private hospitals and clinics, though, they are going to be savagely exposed, I think, to market pricing
08:04because you're going to see them having fewer of that buffer stock that I mentioned
08:09compared to the Ministry of Health, right?
08:11They will be buying or have stocked enough for maybe a month, and then after that it runs out,
08:17they have to procure more.
08:19Smaller clinics, you know, there could be dialysis centres, community pharmacists,
08:25all of them have smaller stocks.
08:27So, they would have purchased earlier and now are being subjected to higher prices.
08:33Freight surcharges, the market pricing is different.
08:36Even the currency fluctuations.
08:37Fortunately, Malaysia is actually in a good position right now when it comes to the currency.
08:42But it's sort of nullified by the demand and supply situation right now
08:48where we are seeing some diminished capacity or even empty shelves for certain goods at pharmacies.
08:56So, all of this comes into play.
08:58And in our estimation, we're going to see the private sector feeling this a lot more higher
09:05compared to the public hospitals.
09:08They're very at risk.
09:09Azra, can I ask you, could this have been mitigated by, I don't know,
09:14you talked about stockpiles and procurement strategies, right?
09:19Were there lessons that we could have learnt from COVID-19, from the pandemic,
09:23that we could have implemented that would have allowed the healthcare systems,
09:28with public and private, to be more resilient or absorb any kind of supply shocks of this nature?
09:34Or is it not the same type of scenario?
09:38Is it fundamentally different this time?
09:40Well, you know, Melissa, the word stockpile has been bandied about quite a bit over the past two months now.
09:48And the fact is, is that Malaysia is actually better prepared than before COVID-19, really,
09:53in terms of awareness, surveillance and, you know, that buffer stock that we keep talking about.
09:59And right now, the government has actually indicated that there are plans now for tiered stock preparedness.
10:04And then there's that one to three months supply at healthcare facilities and so forth, right?
10:09But the problem here is easier said than done.
10:12You know, stockpiling involves a lot of issues, such as the cost of warehousing,
10:20which components or which medical devices or pharmaceuticals do you want to stockpile.
10:26We can't stockpile everything because there's not enough money to pay for that.
10:32They all have expire dates, meaning you cannot use them beyond a certain date.
10:38And after that, you have to throw them away.
10:40And the most important thing is really about warehousing some of these equipment, pharmaceuticals, consumables and so forth,
10:48because all of it takes up space, right?
10:50So even though you have it for even half a year, you're going to have to pay for half a
10:55year worth of warehousing.
10:57Who's going to pay for that, right?
10:58But the fact of the matter here, Melissa, is that this crisis is fundamentally different compared to the COVID-19
11:05pandemic.
11:06You know, COVID-19 was a demand, infection control shock.
11:11The straight-of-hormous crisis that we're seeing here is an energy, shipping, petrochemical and logistical shock.
11:19Very few of which were actually present during the COVID crisis.
11:22So it's hitting us on so many levels that a lot of us have to pick up books or learn
11:28about subjects that we didn't learn about when we were in school
11:31to learn about where things go, at what point is this thing affected and how it affects patients and doctors
11:39and healthcare services being delivered here.
11:41So even when we talk about, oh, we should produce more in Malaysia, you know, so that we are less
11:48vulnerable, exposed to these kind of shocks in the future.
11:50But even the locally manufactured products still depend on imported feedstocks from China, from India, from the Middle East, you
11:59know, the components, packaging or, you know, international freight.
12:02So the lesson from COVID-19 is quite clear is that stockpiles matter, but what we need to be able
12:09to see in the future moving forward, if we can actually think about moving forward,
12:13even though we are stuck in this crisis right now, is that we need to be able to diversify suppliers.
12:20We have to ration, we have to look at transparency, early warning systems, maybe, and of course, have a certain
12:28limit in terms of stockpiling so that we are better prepared and resilient and able to absorb some of these
12:35crises in the future.
12:37Because I feel that this is not going to be the first.
12:39I mean, we are having this situation after COVID, what, six years ago.
12:45So every five years, I think we are going to have to prepare that there will be something of this
12:49scale happening and affecting us.
12:51So we can't be complacent and we need to be constantly vigilant on these issues and to prepare our health
12:57systems to be able to deliver services and to be able to deliver care, regardless of the conditions in which
13:05we face.
13:06Azra, thank you so much for being on the show with me today.
13:08Azra Mahmoud Khalid from the Gallon Centre for Health and Social Policy, wrapping up this episode of Consider This.
13:14I'm Melissa Idris signing off for Evening.
13:16Thank you so much for watching and good night.
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