UPDATE: June 17, 2022: GE Healthcare said on Wednesday that its facility in Shanghai returned to full production capacity on June 8. The facility was just one of a handful by GE that produces iodinated contrast media, which is an injectable used in patients to enhance X-rays and CT scans.
GE said that local COVID-19 restrictions had affected production capacity. Shanghai underwent a two-month lockdown in response to the most recent wave of COVID-19 cases. The city lifted the restrictions on June 1.
Dive Brief:
- GE Healthcare expects production at its Shanghai facility to return to close to 100% next week, helping it to stabilize the supply of iodinated contrast media after a disruption caused by the COVID-19 pandemic.
- Production at the Chinese plant had come to a standstill amid local lockdowns, forcing physicians in the U.S. to postpone nonemergency tests. Supply climbed to 60% of normal by May 21 and GE was targeting a return to 75% capacity by early June.
- GE said in a statement on its website Thursday that it plans to work with its affected customers “to help them plan several weeks ahead as supply progressively recovers.”
Dive Insight:
The cessation of work at GE’s Shanghai facility, part of a citywide shutdown in response to rising cases of COVID-19 had far-reaching effects. With analysts at Needham estimating GE controls one-third of the global contrast media market, the loss of output from one of its facilities affected physicians in the U.S. Lacking supplies of the dye cardiologists use to visualize blood flow and place devices and which oncologists use to monitor tumors, physicians began rationing stocks to ensure availability for critical patients.
GE set out its response to the supply of its Omnipaque and Visipaque products on May 23, revealing that output was back up to 60% and on track to reach 75% in the next two weeks. While working to boost output in Shanghai, the company started expanding production in Ireland and switching from sea to air shipping to accelerate the delivery of the available stock.
The easing of local COVID-19 restrictions has helped GE get the Shanghai facility close to full capacity ahead of schedule. The company now expects the facility to “be close to 100%” starting on June 6 and for the increased output to improve supply.
“This will enable us to restabilize our global supply of iodinated contrast media. We will continue to work with impacted customers to help them plan several weeks ahead as supply progressively recovers,” GE said in the statement.
Other medtech companies could benefit from the resolution of the supply disruption. Medtronic CFO Karen Parkhill, speaking to investors on a quarterly results conference call last month, identified the disruption as a potential problem for the company’s cardiovascular and neuroscience products while expressing optimism about a speedy resolution.
“We believe it's a transient issue. It's mostly contained to the U.S. We do expect it to resolve within the quarter, just based on what we're hearing. At this stage, we've built our view of it into the guidance for the first quarter, and we do believe it's a transient issue getting better after the first quarter,” Parkhill said.
Elise Reuter contributed reporting.
