Strengthening the healthcare supply chain in a post-pandemic world

While drug shortages have been a challenge in the U.S. for years, the impact of the pandemic on the entire healthcare supply chain was unprecedented as were resulting effects on patients and caregivers.  

During a July Becker's Hospital Review webinar sponsored by Fresenius Kabi USA, healthcare leaders discussed how stakeholders can prepare for future disruptions by building more capacity, redundancy and resiliency – and creating the conditions for these necessary capabilities. Panelists were:

  • Loressa Cole, DNP, RN, CEO, American Nurses Association
  • Retired Capt. Valerie Jensen, USPHS, Associate Director, CDER Drug Shortage Staff, FDA
  • Jonathan Kimball, vice president, trade, international affairs and strategic initiatives, Association for Accessible Medicines
  • Scott Meacham, president, pharmaceuticals, Fresenius Kabi USA

Three key takeaways were:

  1. The impact of the pandemic on nurses highlighted the need to better support them. The elevated workload and stress caused by COVID-19 exacerbated issues that nurses had been enduring for a long time. The pressure on nurses is so pronounced that many are now looking to leave the profession. According to the latest installment of the American Nurses Foundation’s ongoing “Pulse on the Nation’s Nurses Survey Series,” the key issues cited by nurses include insufficient staffing, negative effects on mental health and well-being, lack of support from employers and inability to deliver quality care.

    To stave off a nursing exodus, healthcare and government actors must do more to support nurses. "By providing them a seat at the table and capitalizing on the trust they have with the public, we can recognize the opportunity we have to be better and stronger post-COVID," Dr. Cole said.

  2. Communication between the FDA and manufacturers is key in managing drug shortages. According to the FDA’s Jensen, key factors impacting drug shortages and the capacity to mitigate them are: 1) smooth, frequent, effective communication between manufacturers and the FDA. "We put out a guidance to industry in April of 2020 and we were requesting companies to notify us not only of potential supply disruptions, but also of increased demand," Ms. Jensen said, and 2) risk management planning which, in part, correlates to the market not recognizing and rewarding manufacturers with mature quality management.  Quality-related causes for shortages remain a reality. In 2021 55% of drug shortages were attributed to manufacturing delays as well as quality-related issues and 32% of shortages were attributed to increased demand. Jensen also noted that manufacturers continue to be challenged in 2022 by increased demand due to need for more IV narcotics and IV fluids. This creates competition within manufacturers on their own production lines due to limited capacity and industry-wide short supply of manufacturing components (e.g. filters) and commodities (glass, stoppers, bags).

  3. Legislation has an important role to play in strengthening the healthcare supply chain. The generics industry demonstrated remarkable resilience during the pandemic as it activated contingency plans and tapped into safety stockpiles to respond to supply challenges.

    Nonetheless, going forward, it is crucial that bipartisan legislators and the Biden administration — all of whom are pushing for increased domestic production of pharmaceuticals — establish a more predictable market. "Companies need to know that there's going to be a market for their products and that when they flip the switch for the new line or open the door for the new plant, they're not going to be undercut by less expensive imported products," Mr. Kimball said.

    Mr. Kimball noted the federal government should also provide more grants and tax incentives to encourage domestic production, as well as be willing to enter into long-term contracts based on guaranteed pricing and volume with manufacturers. 

Today, manufacturers face a market characterized by increasing competition, where the challenges of forecasting customer needs and adjusting production planning by scaling up or down — which requires increasing capacity and building in redundancy — are magnified.  

"We're spending a lot of time hiring, training, putting in systems to automate our processes and getting larger batch sizes," Mr. Meacham said. "We believe that will result in a high-quality, reliable supply of medications that patients need and less vulnerability due to increased supply demand and other disruptions."

To view the full webinar, click here

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