Vendor groups call for drug supply chain restructuring to avoid stockouts

The federal government should offer incentives to encourage drug manufacturers to manufacture essential drugs and active pharmaceutical ingredients, a coalition of supplying organizations is calling in a set of policy recommendations released Thursday.

Encouraging pharmaceutical suppliers to develop end-to-end manufacturing infrastructure in the US and overseas could help alleviate drug shortages. report

Continuous production, as opposed to mass production, uses fully integrated assembly lines that produce smaller quantities but can be quickly deployed to produce a variety of drugs.

“This manufacturing facility is vulnerable because it is difficult to migrate to other products,” said Tom Kraus, vice president of government affairs for the American Society of Health Systems Pharmacists. “Continuous manufacturing plants can produce different ingredients locally on a smaller scale compared to large factories that are extremely efficient at producing huge volumes of a single drug.”

The COVID-19 pandemic has exacerbated vulnerable links in the healthcare supply chain as foreign supplies of medicines and personal protective equipment were suddenly closed. Employee safety and service quality suffered as service providers tried to find alternative sources.

The Strategic National Reserve has largely failed to fill these gaps. “There was no transparency. Different agencies sent out different messages about what is in the Strategic National Reserve and how to access it, ”said Kraus. “There are ways to stimulate private sector stockpiling, such as lucrative government funding that allows health systems to [group purchasing organizations] or manufacturers for storing inventory. “

The federal government could increase drug supply by offering tax breaks in the form of grants to pharmaceutical companies, which include continuous manufacturing recommend supplier groups.

The organizations argue that, in addition to encouraging a reliable supply of drugs and active pharmaceuticals, policymakers should pass legislation that will strengthen strategic national stock, improve collaboration with foreign manufacturers, reward high-quality manufacturers, and increase reporting requirements.

The groups believe that regularly updating the inventory of strategic national stocks, including monoclonal antibodies to various pathogens, will help during public health emergencies. Wholesalers and distributors are also required to report supply volumes and locations of their contract manufacturers, which are often the source of quality failures.

“The location of the contract manufacturers is something that still worries us. If a pharmaceutical or device supplier has multiple manufacturers, it may seem like they have a heterogeneous network, but this is not the case if they rely on one contract manufacturer, ”Kraus said. “We need the FDA to see these supply disruptions clearly.”

Health systems have set up PPE manufacturing facilities in the US as a temporary measure during the pandemic. While suppliers are looking to diversify their suppliers rather than relying heavily on Chinese sources in the long run, many of these local businesses have failed as cheaper foreign manufacturers have resumed production.

The healthcare system has historically relied on cost-effective, timely inventory strategies, whereby suppliers kept a limited amount of personal protective equipment in place and ordered more as needed. But many suppliers have stockpiled more equipment and have long-term contracts with suppliers and distributors, so they have more at their disposal.

Civica Rx and some GPOs have also helped bolster the supply of generic drugs that are in short supply, and the government could do something similar, Kraus said.

The FDA should require drug and device manufacturers to publicly report quality metrics that measure reliability, which will improve service quality and predict supply disruptions, supply organizations advise.

Currently, the only tool the FDA uses for greater transparency is to try to dishonor companies through public letters. According to provider groups, not reporting a “prohibited act” will pave the way for more severe penalties.

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