H1N1: US industry update


The World Health Organisation (WHO) and the Centres for Disease Control and Prevention (CDC) have come to different conclusions on the severity of H1N1 in the US. opi.net talks with leading industry figures there to get the latest on how the swine flu pandemic is playing out in the US and how it is impacting the country’s industry.


The Americas still account for the majority of deaths from swine flu. The WHO estimates that 4,512 have died since the pandemic virus was first identified in April in Mexico and the US, an increase of 113 in a week.


However, new and separate data from the CDC estimates that swine flu has killed as many as 3,900 people in the US. CDC health officials have used a new counting method that yielded an estimate six times higher than the last. The CDC’s previous estimated death toll from H1N1 was 672.


While still imprecise, the new statistics provide "a bigger picture of what has been going on in the first six months of the pandemic," Anne Schuchat, Director of the CDC’s National Center for Immunization and Respiratory Diseases, told the media. She explained previous estimates were based on laboratory confirmed cases of hospitalisation and death, potentially giving an incomplete picture of the story of this pandemic.


It seems a confusing picture in the US. The only constant being a barrage of worrying H1N1 data and media speculation. For the US industry, it is clear that demand for Jan/San products to contain the spread of the illness has soared, but how is the industry coping under the strain?


Ralph Bianculli, CEO of the Paradigm Group, told opi.net that the CDC’s method of estimating the cases of flu in the US was making it difficult to determine the extent of the problem, but winter approaches his company is preparing for the worst.


"There are pockets of issues which they can relate to H1N1," he said. "The CDC has now consolidated all data with ordinary flu outbreaks because of the difficulties in separating and diagnosing the different flu strains. As a supplier of flu preventive products, we have stocked up on multiple solutions in order to be prepared for the prime flu season."


Ready to use products, such as alcohol-based offerings, are selling well, according to Bianculli. He said the priority for his business is to be prepared and have good product variation and the Paradigm Group has up to six different solutions for the end-use marketplace.


The media frenzy surrounding the outbreak has caused unprecedented demand, although Bianculli said that thinking on its feet has helped Paradigm meet demand.


"We have experienced shortages on particular brands and can fill those orders with our alternative solutions which require better educating due to lack of marketing presence," Bianculli explained. He pointed out that for Paradigm, educating people on solutions was a real boon.


"We are staying focused on educating the consumer in alternative preventive measures which are working as we expected," he pointed out.


However, shortages on some lines will remain a problem. Bianculli pointed out that there are shortages in many alcohol-based products, due to overstocking and hoarding. He thinks that, in the swirl of media confusion, educating decision makers is of crucial importance.


"We are educating many decision makers to utilise preventive (disinfectants) to better control outbreaks," said Bianculli. "We have also just recently begun supplying kits with assorted preventive products."


Mike Miller, VP and General Merchandising Manager – Janitorial and Breakroom, United Stationers agreed that the pandemic had significantly increased sales on cold and flu related products. He said that office products dealers have to work hard to meet consumer demands for sanitising products. 


"There has also been additional demand for personal protection items such as anti-viral facial tissue, respirators/masks and protective gloves," added Miller. For United, the top selling products have been hand sanitizer gels, foams, liquid sprays and wipes; but also surface sanitizers/disinfectants sprays and wipes. Air sanitizer sprays and soaps and dispensers for soaps/sanitizers have also experienced an upsurge.


Miller said the demand for products has seen a stress point develop around the manufacturer’s ability to secure the raw materials, production time and resources to meet the elevated demand.


"Many suppliers are finding it difficult to produce enough product to meet the demand spike, thereby limiting our ability to keep those items in stock and meet our customer’s demand," Miller commented. "However, certain items are not currently able to ship because of manufacturer supply issues.


"We do have comparable product alternatives to some of these short supply items with available inventory. We’ve also received indications from some key manufacturers that they hope to be out from under their backlog by the end of the year."


For Miller the key during this period of high demand is for a company to be flexible. He said that a business has to identify a "wide variety of comparable products" that will meet customers’ needs.


Systemcare is a UK-based manufacturer owned by US company ITW. The company ships product into the US, and was in the fortunate position of having a stock of bacterial and virus protection products when the outbreak started in the spring. A bacterial and virus protection range had already been launched by Systemcare as a result of the previous avian flu and SARS outbreaks a few years earlier. This enabled the company to meet the overwhelming demand as a result of the pandemic. 


Doug Skeggs, Systemcare’s Marketing Director, said the first quarter saw widespread destocking and when demand increased after the virus started spreading, very few major suppliers into the OP trade had any stock of a range of bacterial, hand hygiene and virus protection products.


"To ensure the extra demand didn’t affect our normal business we immediately had to implement a 24-hour production regime and still our lead times were temporarily extended, coupled with that many of the raw material suppliers were unable to keep up with our demand," Skeggs explained. "Like many companies we had forecast a flat year for 2009 but will now end the year substantially above our original estimations – as will many of our OP customers."


So Systemcare was quickly extending its product range to meet the ever increasing demand. Systemcare’s product development team headed up by Commercial Manager Samantha de Costa.


"We already had the core products available like hand gels and a variety of cleaning products, but started get requests from our business to business customers for special kits which had resulted from very large corporations developing protection kits to their own specifications," said de Costa.


Systemcare was then mentioned on UK television news as a principal supplier of the products causing demand to spike again.


"In the last ten days we have seen the demand steady but many of our larger customers now have virus and bacterial protection products in their range," de Costa commented.


Skeggs is also concerned that many companies have rushed products to market, shirking labelling regulations to meet demand. In the US, the hand rubs need to comply with FDA requirements and surface cleaning claims with the EPA.


"It’s a very costly process to get compliant products so some companies appear not to bother until challenged by authorities," said Skeggs. "Buyers need to make sure products comply when making claims or sourcing products."


The extent to which H1N1 is affecting some parts of the world may be cloudy. Collating figures on such a widespread pandemic is no mean task. But this is not something that is going to go away; and the industry needs to factor that into its thinking. A European Centre for Disease Prevention and Control update dated 16 November bears that assertion out. The update said that in the previous week, the total number of deaths caused by H1N1 reported globally increased by 7 percent.


For those companies who find themselves pressurised by demand for Jan/San products the message is clear: they must be flexible and have a good range of alternatives to popular lines. Front line staff must also be up to speed on the products their companies offer, how much is in stock and how they can help to combat flu viruses in general. Keeping on top of this may enable a business to meet this unprecedented demand.