With hundreds of drug shortages persisting across the U.S., pharmacy leaders are adopting more coordinated strategies to manage supply disruptions and mitigate financial losses. These include expanding on-hand inventory for critical injectable medications, centralizing supply chain operations and embedding clinical decision tools. The goal, as one leader told Becker’s, is to ensure supply chains are “not only operationally sound but also clinically meaningful.”
Hospital labor expenses tied to managing these shortages increased from $359 million in 2019 to $894 million in 2024, according to a June Vizient report. Pediatric facilities were hit especially hard, tracking 25% more shortages and more frequently exceeding pharmacy budgets than other hospitals.
Vizient researchers in 2019 also estimated that drug shortages cost hospitals an additional $359 million annually in labor alone and $200 million more each year from purchasing higher-priced substitute medications.
Here are responses from 10 pharmacy leaders who were asked: What strategies are most effective in mitigating persistent drug shortages?
Editor’s note: Responses have been lightly edited for style and clarity.
John Armitstead, Vice President of Pharmacy Services at Lee Health (Fort Myers, Fla.): Hospitals should establish a list of critical-to-mission medications (primarily injectables) and alter the standing inventory of these agents from traditionally a one-month supply (12 turns per year) to a three-to-four-month supply (three to four turns per year). We have done this for approximately 140 items of high risk for drug shortages. In addition, a policy on drug shortages should be written, be at the ready and prepared to be edited as a plan for the next shortage. The next shortage is coming in our fragile, no-longer-just-in-time, unstable, diminishing, oligopolistic pharmaceutical supply chain.
Jay Bornstein, PharmD. Director of Pharmacy Supply Chain at Beth Israel Lahey Health (Cambridge, Mass.): Mitigating drug shortages has been difficult due to the randomness and varying severity. Although we use several strategies to mitigate drug shortages, our main strategy is to use our centralized services center to consolidate inventory, including safety stock where applicable, and distribute from our hub. Having the physical space to purchase sufficient quantities of items, with strong histories of market interruptions or that have limited alternatives, allows us to “extend our runway” if and when a shortage occurs.
Our 14 hospitals are able to coordinate purchasing and inventory, based on the needs of each hospital, and the information is tracked with our CSC inventory system. Using an integrated purchasing platform to drive orders to the CSC helps reduce the manual input by the buyers to recall where to purchase certain products.
Tom Greenlee, PharmD. Senior Director of Pharmacy Services at University of Missouri Health Care (Columbia): Effective strategies are multifaceted and will vary from shortage to shortage. It is important to build and maintain strong relationships with suppliers (plural). Most pharmacy departments invest significant energy into their primary wholesaler relationship, but it is important to invest the same energy in fostering relationships with secondary wholesalers and gray market vendors. This increased collaboration can lead to more reliable sourcing during the early stages of a drug shortage, allowing for strategic purchasing and bulk buys. It is also important to empower your buyers to make purchasing decisions from secondary wholesalers and the gray market. Supply dries up quickly, so remove barriers and complicated internal approval pathways. Also consider centralizing inventory during critical shortages and layering in a proactive approach by enrolling in strategic reserve programs, such as those offered by your group purchasing organization.
The importance of strong interdepartmental communication cannot be overstated. Clinical departments should be engaged in determining therapeutic alternatives and taking the lead in managing utilization. Hard wire clinical decisions into your EMR workflow for persistent shortages to sustain long-term reduction in demand.
Maria Guido, PharmD. Supervisor of Pharmacy Purchasing and Distribution at UC Health (Cincinnati): Key drivers for effective shortage management include proactive planning, robust, timely communication, access to health system data, and centralized medication management processes. A dedicated drug shortage team must be responsible for continuous monitoring of national and international drug shortage lists (e.g., FDA, ASHP), leveraging advanced inventory management software to track real-time utilization and days-on-hand across all facilities within the health system. This centralized oversight allows for efficient redistribution of existing stock between locations, preventing waste and ensuring critical medications are available where most needed. Furthermore, the centralized team facilitates early identification of potential shortages, enabling prompt action such as exploring alternative suppliers, different dosage forms, or in-house compounding, where appropriate and compliant with regulations.
A centralized team is also crucial for implementing long-term resilience strategies. This includes diversifying contracts with multiple suppliers and manufacturers, prioritizing those with demonstrated reliability and quality manufacturing practices. The team can also develop and standardize therapeutic interchange protocols and clinical guidelines for alternative medications, ensuring consistent and safe patient care across the entire health system during a shortage. Leveraging the electronic health record to embed shortage alerts, provide decision support for prescribers, and facilitate communication about alternative therapies is also a key function of a centralized team. By proactively engaging with clinicians, legal and public relations departments, the centralized team ensures a coordinated and ethical response, minimizing the impact of shortages on patient outcomes.
Derek Imars, PharmD. Executive Director of the Pharmacy Supply Chain at Indiana University Health (Indianapolis): At Indiana University Health, we are building on our strong drug shortage response foundation, which includes dedicated staff, clear communication, and robust data tracking. To future-proof our pharmacy supply chain, we are focusing on three key areas: advanced data utilization, proactive critical product management and strategic allocation programs. We believe accurate and enhanced data is our most vital tool; we are exploring new technologies that not only provide real-time inventory and utilization insights but also integrate global, economic, and weather-related factors to forecast potential disruptions more effectively. Furthermore, establishing a systemwide critical pharmaceutical product list allows us to shift from retrospective to prospective shortage mitigation, ensuring patient care remains uninterrupted and reducing caregiver burden.
Finally, we are leveraging our pharmacy integrated service center to implement proactive pharmaceutical allocation management. This involves securing critical product allocations, both internally and with vendor partners, for several months in advance. This strategy guarantees access to vital medications during shortages, enhances emergency response, reduces waste, improves cost management, and protects revenue by minimizing procedure cancellations. By combining our foundational strengths with innovative technology, a strategic critical product list, and proactive allocation programs, we are better equipped to navigate and mitigate the clinical and operational challenges of drug shortages.
Todd Karpinski, PharmD. Chief Pharmacy Officer and System Vice President at WVU Medicine (Morgantown, W.Va.): Drug shortages continue to be a challenge for health systems across the country. At WVU Medicine, we have opened a 20,000-square-foot warehouse to help mitigate the impact of drug shortages. Our business operations team is using some predictive technology to identify potential shortages early and to procure adequate stock for our 25 hospitals. We have also identified a “never out” list of medications that we store centrally at our warehouse and distribute to our system hospitals.
Ricardo Lagares. Director of Pharmacy Business and Finance at Hackensack Meridian Health (Edison, N.J.): At Hackensack Meridian Health, we have fundamentally shifted our approach to drug shortages from a reactive posture to one of proactive resilience. Our strategy is built on three core pillars:
First, we transformed our procurement model from a “lowest price” to a “best value” framework, which prioritizes manufacturer reliability and supply chain diversification to minimize risk from the outset. Second, our clinical teams have developed a robust drug shortage playbook, featuring pre-approved therapeutic alternatives and conservation protocols. This empowers our frontline staff to maintain the highest standard of care without delay during a supply disruption. Finally, we maintain a targeted buffer stock of mission-critical medications, which serves as a vital safeguard to ensure uninterrupted patient care during acute shortages.
This integrated approach ensures we are prepared, agile, and focused on patient safety in the face of supply chain volatility.
Collin Lee, PharmD. Corporate Director of Clinical Pharmacy Services at Emory Healthcare (Atlanta, Ga.): With real-time inventory, having a standardized system approach for formulary alerts and EMAR changes is needed in order to reduce resource redundancy and allow for centralized coordination of supply across our hospitals. Ensuring key subject matter experts are equipped to make system decisions facilitates our efficiency in enacting necessary changes and allows us to preserve supply and obtain alternatives in a timely manner.
Bonnie Levin, PharmD. Vice President of Pharmacy Services at MedStar Health (Columbia, Md.): MedStar Health has adopted a comprehensive, interdisciplinary strategy to proactively manage and mitigate drug shortages across the system. Central to this approach is the collaboration among pharmacy, medical, and nursing leaders through system-wide Clinical Practice Councils. These councils work in concert with the Pharmacy & Therapeutics Committee, procurement teams, and both clinical and operational stakeholders to ensure alignment and rapid response.
By standardizing care protocols and fostering transparent, cross-specialty communication, MedStar Health is able to make timely, evidence-based decisions regarding therapeutic substitutions, usage restrictions, and clinical guideline updates. This agile and coordinated framework has proven effective in minimizing the impact of shortages on patient care while maintaining high standards of safety and quality.
Chance Partlow, PharmD. Director of Pharmacy Supply Chain at Advocate Health (Charlotte, N.C.): In my experience, the most effective way to address persistent drug shortages is through a proactive, system-level strategy that draws on the collective strengths of pharmacy professionals across clinical, operational, informatics, automation and supply chain domains. When these disciplines work in concert, we’re better equipped to anticipate disruptions, implement therapeutic alternatives and ensure the strategic and equitable redistribution of medications across hospitals based on clinical need and patient impact.
Among the most impactful strategies we’ve implemented are EMR-backed tools that assist providers in selecting preferred therapeutic alternatives at the point of order, as well as participation in manufacturer-backed commitment programs — particularly for unique medications with limited or no substitutes. These approaches enhance resilience and minimize care variance across the system.
Above all, transparent, real-time communication with front-line pharmacists is essential. Their insights ensure that our mitigation strategies are not only operationally sound but also clinically meaningful.
