To Fix the COVID-19 Testing Gap, Take a Lesson from GM (or the Pentagon)

Within a single 48-hour period earlier this month, the Trump administration announced plans to begin returning federal employees to work – and found that two non-symptomatic White House staffers were positive for SARS-COV-2, the virus that causes COVID-19. The White House discovered the infected staffers because it regularly tests staff, regardless of symptoms, in order to prevent an outbreak in the country’s most important workplace. But as President Donald Trump pushes for a wider reopening of the U.S. economy, the White House infections highlight both what is required to reliably protect Americans at work and how remote that goal remains. 

If aggressive testing is essential to prevent an outbreak at the center of the American government, it is just as crucial to safely bring the U.S. economy out of lockdown. Rolling outbreaks in the parts of the economy that have remained open — such as meatpacking facilities — provide a preview of what may await a nervous U.S. workforce if it heads back to work without widespread testing. Safely restarting the economy will require a dramatically different approach to testing availability than the government has been able to muster so far. 

The Trump administration initially pinned its hopes on the private sector, expecting that the magic of the market would scale to meet America’s vast testing needs. Nearly two and a half months have passed since the U.S. Food and Drug Administration gave private labs in the United States a green light to develop their own tests for the virus. The government expected this to rapidly enable mass-scale testing; Vice President Mike Pence predicted 4 million tests to be distributed by mid-March, and the president promised on March 6 that “anybody who needs a test can get a test.” 

Reality has proved otherwise. An antibody survey last month in New York state, which has had some of the highest testing volumes in the country, found nonetheless that the likely case count was over 10 times greater than test-confirmed tallies. U.S. testing still falls well short of the 900,000 tests per day that Harvard University’s Global Health Institute estimates the country would need – along with robust contact tracing – to safely reopen the country. While testing rates are slowly rising, U.S. testing is not on track to reach that mark for many months. And even that level would leave us well below the kind of robust testing South Korea achieved, which at current U.S. case levels would equate to millions of tests per day.

The continued lack of testing remains an enormous obstacle to detecting and controlling the virus – and thus to safely reopening the country. To truly scale up COVID testing, the federal government needs to borrow a page from General Motors (GM) — or the Pentagon.

GM is as much a supply chain manager as a vehicle manufacturer. To produce millions of cars per year, GM must ensure that its raw materials and tens of thousands of unique parts arrive at its plants on time, in the right quantity, and to the right specifications. So, GM, like any major industry, invests heavily in cultivating and managing its supplier networks and material providers. As a dominant buyer, it has great influence over the suppliers that do business with it, and can use this dominance to dynamically manage the quality, reliability, and timing of its upstream supply chain partners (a skill set it has also recently applied toward the challenge of manufacturing ventilators for U.S. hospitals). 

There are times when the federal government plays a similar role. U.S. law requires the Department of Defense to maintain adequate supplies critical to our national defense, and so DoD directly cultivates critical defense supply chains. As the dominant buyer in the market (by definition) DoD orchestrates an upstream defense industrial base to meet the massive supply needs of the U.S. military.

Like building vast numbers of cars or tanks, manufacturing vast numbers of COVID-19 test kits is a complicated supply chain challenge. Different links of the testing supply chain are dynamically interconnected – the flow of raw materials; the production capacities for reagents, specialized swabs, and other supplies; the manufacturing of sophisticated PCR lab equipment; the personnel (clad in appropriate personal protective equipment (PPE)) who administer the tests; and the sample-processing capacity in individual labs. All elements must scale up in concert; a bottleneck at any of these levels can disrupt the whole chain. 

But unlike GM’s management of its parts suppliers, or the Pentagon’s management of its industrial base, there is no dominant player coordinating a concerted end-to-end scale-up of this supply chain. Testing companies produce proprietary test kits and corresponding hardware to their own specifications instead of standardized products that would be more widely usable. States and hospitals around the country, who administer the actual tests, buy these and become locked into each company’s individual systems and corresponding supply lines. Market incentives are misaligned, with industry’s incentives to make large up-front investments in expanding production hampered by uncertainty about longer-term demand. The federal government – rather than using its potential market leverage to bring order, scale, and consistency to this landscape – has left every state, territory, and hospital at the mercy of a fragmented and opaque market.

The chaotic state of this current testing marketplace is a direct impediment to outbreak control and economic recovery. The federal government should engage in the testing supply chain just as actively as DoD manages the supply chains for the defense industrial base, or GM coordinates its parts suppliers. At present there is little public clarity on which links of the supply chain are bottlenecked, nor how they could be fixed. And federal involvement remains tepid: The FDA has suggested that it would be “helpful” but not mandatory for manufacturers seeking Emergency Use Authorization to “provide information on testing capacity, as well as the number of laboratories in the U.S. with the required platforms installed.” This kind of passive, voluntary engagement is not getting the job done.

An assertive federal role need not mean a federal takeover. Rather it could mirror the “Performance Based Logistics” model that DoD applies to its supply chains. The federal government could use its unique buying power to orchestrate a synchronous scale-up across all links in the supply chain, and prevent bottlenecks at one level from undermining all of the others. The recently passed Paycheck Protection Program and Health Care Enhancement Act requires the Secretary of Health and Human Services to quickly develop a national testing plan. HHS should use this as an opportunity to borrow a page from DoD and lay out a play for federal coordination across the testing supply chain to address potential bottlenecks. Where supply chain elements are functioning smoothly, the federal government need not step in. But where critical bottlenecks exist, the government should engage industry to create targeted incentives to scale up, using the buying power and influence that only it can muster.

Without more testing, we will remain blind to the full extent of this outbreak. Safely reopening the country and restoring economic confidence will be impossible until all workers can be as safe from the disease as those who work in the White House. The ability to diagnose and respond to COVID-19 is a national strategic asset, as essential to collective U.S. security as a tank battalion or an aircraft carrier. The federal government must treat testing as the same sort of national asset: investing in the supply chain for COVID-19 diagnostics, so that we can stop flying blind.

Image: Medical workers in personal protective equipment (PPE) test for COVID-19 on May 13, 2020 in New York City. Photo by Spencer Platt/Getty Images

 

About the Author(s)

Jeremy Konyndyk

Jeremy Konyndyk served as the director of USAID’s Office of US Foreign Disaster Assistance (OFDA) 2013-2017, where he led the US government’s response to international disasters. Follow him on Twitter (@JeremyKonyndyk).

Kevin O’Connell

Kevin O’Connell is Vice President, Technical Staff with B.Next, the division of IQT Labs, formerly served as a Research Microbiologist at the US Army Edgewood Chemical Biological Center (now the US Army Combat Capabilities Development Command Chemical Biological Center).

Dylan George

Dylan George is Vice President, Technical Staff at In-Q-Tel (IQT), served in HHS/BARDA and White House OSTP during the Obama administration. Follow him on Twitter (@dylanbgeorge).