Supplier groups call for restructuring of drug supply chain to avoid shortages
The federal government should offer incentives to encourage drug makers to manufacture essential drugs and active pharmaceutical ingredients, a coalition of supplier organizations urged in a set of policy recommendations released Thursday.
The American Medical Association, the American Society of Anesthesiologists, the American Society of Health-System Pharmacists, the Association for Clinical Oncology, and the United States Pharmacopeia strongly recommend in the report that pharmaceutical suppliers be rewarded for the development of a continuous manufacturing infrastructure in the United States and abroad.
Continuous manufacturing, unlike batch manufacturing, uses fully integrated assembly lines that produce smaller quantities but can quickly rotate to make different drugs.
âThese batch manufacturing facilities are vulnerable because it is difficult to transition these lines to other products,â said Tom Kraus, vice president of government relations for the American Society of Health-System Pharmacists. âContinuous manufacturing sites can produce various ingredients on-site on a smaller scale compared to large factories that produce huge volumes of a drug extremely efficiently. “
The COVID-19 pandemic has amplified vulnerable links in the healthcare supply chain as access to foreign supplies of drugs and personal protective equipment abruptly halted. Employee safety and the quality of care suffered as providers struggled to find alternative sources.
The national strategic stock has largely failed to fill these gaps. “There was no transparency. Different agencies were sending different messages about what was in the national strategic stock and how to access it,” Kraus said. âThere are ways to encourage private sector storage, such as favorable government funding that enables health systems, [group purchasing organizations] or manufacturers to hold inventory. “
The federal government could increase drug supply by offering tax incentives in the form of grants to drug companies that incorporate continuous manufacturing, the supplier groups recommend.
In addition to encouraging reliable medicines and active pharmaceutical supplies, policymakers should enact legislation that strengthens strategic national stock, improves collaboration with foreign manufacturers, rewards high-quality manufacturers, and strengthens reporting requirements, argue organizations.
According to the groups, a regular update of the national strategic stock inventory, including monoclonal antibodies for various pathogens, would be useful during public health emergencies. Wholesalers and distributors must also report the supply levels and locations of their subcontractors, which are often the source of quality issues.
“The location of contract manufacturers is something that always concerns us. If a pharmaceutical or device supplier has multiple manufacturers, it may appear that they have a diverse network, but this is not the case. case if it relies on a single contract manufacturer, âKraus said. noted. “We need the FDA to have clear visibility on these supply disruptions.”
Health systems have created PPE manufacturing facilities in the United States as a stopgap during the pandemic. While suppliers expect to diversify their suppliers rather than relying heavily on China-based sources for the long haul, many of these local companies fizzled out when lower-cost foreign manufacturers resumed production. .
The healthcare system has historically relied on lean, just-in-time inventory strategies where providers stock limited amounts of personal protective equipment on-site and order more as needed. But many vendors have stocked more equipment and entered into long-term contracts with vendors and distributors, so they have more at their disposal.
Civica Rx and some GPOs have also helped boost ever-tight generic drug supplies and the government could do something similar, Kraus said.
The Food and Drug Administration should require drug and device makers to publicly report on quality metrics that measure reliability, which would boost high-quality facilities and predict supply interruptions, provider organizations advise.
Currently, the only tool the FDA has to push for greater transparency is to attempt to shame companies through public letters. Viewing non-reporting as a “prohibited act” would pave the way for heavier penalties, according to provider groups.