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This paper investigates an assembly system comprising one manufacturer and two suppliers who provide two complementary components independently. One unreliable supplier may encounter disruption during production, whereas both the manufacturer and the other reliable supplier can assist the disrupted supplier in capacity restoration. We specifically consider two different scenarios. In each scenario, the manufacturer or the reliable supplier ex ante decides whether to handle the disrupted supplier's capacity restoration cost alone and to what extent. We demonstrate that the cost-sharing incentives of the manufacturer and reliable supplier vary significantly under different conditions. When the retail price is high, paying for the disrupted supplier's restoration cost can be favorable for the manufacturer. Otherwise, the manufacturer can benefit considerably when the reliable supplier shares the restoration cost. When the wholesale price is high, handling the restoration cost alone is more favorable for the reliable supplier than sharing this responsibility with the manufacturer. [ABSTRACT FROM AUTHOR]

International commerce and travel have been restricted in order to limit the spread of COVID-19. The illegal trafficking in drugs, which is often concealed in other commercial activity, will be affected by these disruptions. This is particularly true for precursor chemicals, controlled substances of synthetic origin, and new psychoactive substances coming from Asia. China hosts large and under-regulated pharmaceutical and chemical sectors that provide many of the active ingredients used both in legitimate medicines and illicit fentanyl and methamphetamine. Unregulated producers and vendors in China have been supplying drug trafficking organizations in Mexico or using the internet and postal service to directly sell fentanyl to buyers in North America. The magnitude of supply shortages and interrupted trade of chemicals and synthetic drugs coming from China will depend on the breadth and depth of COVID-19's disruptions. In turn, this could impact vulnerable drug-using populations. Drawing on historical accounts of prior supply disruptions, this commentary offers some initial speculation as to the possible effects of COVID-19 on the supply of synthetic drugs like fentanyl and precursor chemicals supplied to North America from China, which may have important lessons for other parts of the globe. Prior supply disruptions coincided with elevated prices and reduced purities of street drugs as well as increases in the number of users entering treatment. However, it is challenging to predict how developments will unfold given the unprecedented nature of this pandemic. A short-term breakdown in supply chains, interrupted trade, or social distancing mandates may not have much of an effect on the availability of synthetic drugs. Yet, disruptions in trade for months or years could shape how drugs are supplied or used. Drug policy will need to evaluate market indicators as soon as they are available but responding now with expanded medication therapies, like methadone, may help save lives. The drug policy landscape could look different in a post-COVID world., Competing Interests: Declarations of Interest None., (Copyright © 2020 Elsevier B.V. All rights reserved.)