As we head into 2022, the pharmaceutical industry still faces uncertainty stemming from supply chain challenges.
As the COVID-19 pandemic drags on, the pharmaceutical industry continues to face uncertainty regarding the stability and quality of the drug supply chain. The American Society of Health-System Pharmacists (ASHP) provided both insight into and recommendations on how to combat supply chain issues in its 2021 ASHP Foundation Pharmacy Forecast.1 Now—nearly a year later—the report’s authors and other experts have come together to discuss what progress has been made to address supply chain issues.
Allocating Scarce Resources
Of the 272 forecast panelists surveyed, 90% thought that at least 75% of health systems would develop guidelines through ethics committees or similar processes to allocate finite resources during a disease pandemic.
Although Erin R. Fox, PharmD, senior pharmacy director at University of Utah Health in Salt Lake City and an author of the ASHP report, said there isn’t a tracking mechanism to determine how many health systems have developed allocation guidance, the Centers for Medicare & Medicaid Services requires that all hospitals have policies in place regarding drug shortages.
“The pandemic forced most hospitals to develop strategies for using limited resources,” said Fox. For example, when remdesivir (Veklury) first became available through an FDA emergency use authorization (EUA), no hospital received the amount it needed to treat all patients who could qualify under that EUA.
Paige Clark, RPh, vice president of pharmacy programs and policy at Prescryptive Health, Inc in Redmond, Washington, said that health care systems have been preparing for a COVID-19 scenario since 2009 when the influenza A virus emerged globally. These preparations, she noted, were made with the understanding that an influx of infected patients would strain all parts of the health care ecosystem.
But even with these preparations in place, COVID-19—more specifically, the Delta variant surge in July and August—considerably strained numerous health systems, including those in Florida, Oregon, and Texas. From a national perspective, Michael Ganio, PharmD, MS, BCPS, FASHP, senior director of pharmacy practice and quality at ASHP in Bethesda, Maryland, said that the federal government, medical corporations, and other organizations have been able to identify vulnerabilities in the supply chain and the ability of the United States health care system to respond to emergencies.
“Since the start of the pandemic, both [the] public and private sectors have taken steps to address vulnerabilities—such as addressing limitations of the strategic national stockpile or building more redundancy in supply chains—which should improve our nation’s ability to maintain access to necessary supplies and medications,” he said.
Medication Quality and Supply
One key recommendation from a recent report by the FDA’s Drug Shortages Task Force2 was to develop a manufacturing quality rating system to provide incentives for drug manufacturers to invest in improving their facilities. Forecast panelists were almost evenly split on whether this would come to fruition. According to Fox, the FDA has recommended a ratings system since 2013 when Janet Woodcock, who headed the FDA’s pharmaceutical division at that time, first wrote how such a system could improve quality and shortages.
However, the FDA has yet to implement a ratings system, and the private sector cannot implement one without the necessary transparency. For example, pharmaceutical companies aren’t required to disclose the name of the company that made a particular product or the factory in which it was made. “Unless the United States Congress requires improved transparency from pharmaceutical companies, I don’t think the FDA will create a ratings system,” Fox said.
The ASHP report mentioned that congressional representatives have introduced multiple bills related to moving drug manufacturing back to the United States, but, Ganio said, there has not been much movement on these bills. There have, however, been executive orders from both current and previous administrations to increase domestic manufacturing. Similarly, the Biomedical Advanced Research and Development Authority, a division of the US Department of Health & Human Services, has made investments in increasing domestic production of some essential medications and their active ingredients.
But according to Ganio, moving drug manufacturing back to the United States alone is not a solution. “There are still some raw materials and precursor chemicals that are not made domestically,” he said. “The domestic pharmaceutical supply chain is also vulnerable to disruption, as we experienced with small-volume saline bags after Hurricane Maria in September 2017.
“Although these products are manufactured domestically, there were still severe, critical shortages of essential medications. Investments in supply chain resiliency, including redundancy and in new manufacturing technologies that can quickly scale up production, are also important strategies to ensure the United States maintains access to essential medications during an emergency.”
Regarding international markets as a source of lower drug pricing, most pharmacy panelists (68%) expected the United States to adopt rules to import prescription drugs from other countries as a way to help lower drug prices.
“Importation of prescription drugs has been proposed for decades, but prior presidential administrations were reluctant to push for more vigorous implementation of importation in the face of opposition by the pharmaceutical industry,” wrote the authors of the ASHP report. “While importation of single-source brandname drugs may not be feasible, FDA may develop pathways for responding to generic drug shortages (or price hikes) by facilitating the regulatory approval of overseas manufacturers of those products.”
Both the current and previous administrations have included importation in their plans to lower prescription drug prices, but progress has been slow, Ganio said, and there are some concerns with these potential plans. Ganio noted that importation may conflict with attempts to guarantee the pedigree of prescription drugs
that are required in the FDA’s Drug Supply Chain Security Act.3 Importation also requires a willingness of manufacturers and wholesalers to sell products from Canada to the United States; however, Canada —concerned with ensuring its own supply of medications—has repeatedly signaled that it may move to block the export of pharmaceuticals if the United States implements a drug importation program.
According to Clark, multiple factors need to be in place for the successful import of prescription drugs, including quality control and the supply chain to ensure the safety of United States citizens. “The process would need to have measures in place to ensure that drugs are made to US quality standards. The US has extremely stringent standards to protect the safety of its citizens,” she said. “Similarly, all aspects of the supply chain must be monitored so that there aren’t any delays, breakdowns, or any other activity that could compromise the security, quality, and delivery of drugs to the US.”
New manufacturing technologies can help improve the quality and reliability of pharmaceutical manufacturing, Ganio said. Continuous manufacturing is more agile than traditional batch manufacturing and can quickly scale up production in response to demand or shift production from one medication to another. “This type of scalable end-to-end manufacturing is a promising advancement in pharmaceutical manufacturing, but it’s expensive to adopt and will take years to implement,” he said.
Joseph T. DiPiro, PharmD, dean of the School of Pharmacy, Archie O. McCalley Chair and associate vice president for health sciences, faculty affairs, at Virginia Commonwealth University in Richmond, who is also an author of the ASHP report, noted that the United States has taken steps to develop a more secure domestic supply chain for generic drugs.
In May 2020, the federal government allocated $354 million to build a national stockpile of essential medications. Phlow Corp, a new company in Richmond, Virginia, is working with Civica Rx in Petersburg, Virginia, and AMPAC Fine Chemicals in Las Vegas, Nevada, on this effort.
Outlook for 2022
According to Ganio, the prescription drug supply chain outlook for 2022 is anticipated to be the same as in 2021. “There are very big issues to address, and solutions will not be implemented overnight,” he said. “Barring any worsening of the pandemic or other geopolitical challenges or natural disasters, we will continue to manage drug shortages that mostly occur as a result of quality problems in manufacturing facilities.”
Recent escalation in shipping issues at ports and with trucking companies is alarming and also a threat to drug supply chains. “Trade restrictions, pandemics, and climate change continue to threaten the drug supply chain, posing an increased potential for drug shortages, and its future impact is unknown,” DiPiro said.
The 2022 ASHP Foundation Pharmacy Forecast is scheduled to publish in early December.