Performance Analysis of Blood Bank Mergers in View of COVID-19 Pandemic and Beyond

During the COVID-19 pandemic, blood service organizations in the United States encountered unprecedented challenges, including reduced donation rates, staff shortages, and widespread burnout - factors that significantly strained their supply chain capacities. As societal activities resumed and demand for blood increased, these challenges were further compounded. Mergers and acquisitions, long considered a strategy for enhancing operational efficiency, had previously been explored in the blood banking sector prior to the pandemic. This study presents a supply chain network optimization model incorporating capacity overflow and outsourcing options to evaluate the effectiveness of blood bank mergers. The model is applied to a real-world case involving a 2015 merger between two California-based blood banks. Several supply and demand scenarios - representing pre-pandemic conditions, the early stages of the pandemic, and a return-to-normal period - are analyzed to compare the performance of the merged entity against a counterfactual scenario in which the two organizations remained independent. The findings indicate that regional blood bank mergers can offer significant advantages during periods of crisis, particularly in terms of operational cost reduction and supply stability.