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Author(s):
Heparin is a critical drug that is highly dependent on the global supply chain and is derived from a highly complex process.
Johanna DeYoung
Global industry lead
Healthcare & life sciences
Slalom
Due to potential tariffs and other actions by the current US Presidential administration, the pharma industry is bracing for disruptions and changes to the global supply chain and manufacturing processes. One drug that is highly likely to be impacted by this is Heparin. Johanna DeYoung, global industry lead of healthcare and life sciences at Slalom, spoke with Pharmaceutical Executive about this potential issue.
Pharmaceutical Executive: How impactful would a shortage in Heparin be?
Johanna DeYoung: A shortage of Heparin would pose a serious threat to patient care across the healthcare system in the US. It’s a critical drug used across many therapeutic areas like dialysis, surgery, cardiac invasive procedures, pulmonary embolisms, prevention of blood clotting, deep vein thrombosis, and anticoagulant coating of devices, to name a few. Heparin is prescribed prolifically in the inpatient setting given its use cases- with some sources estimated between 50-70% of hospitalizations requiring it, which can be more than antibiotics. Heparin’s role has been said to be second only to insulin as a natural therapeutic agent in its regular usage and criticality. Demand for Heparin is high and inelastic, and with few viable alternatives, disruptions in supply could directly compromise health outcomes on a global scale.
PE: How reliant is Heparin on the global supply chain to produce?
DeYoung: Heparin is highly dependent on a complex global supply chain. Heparin was identified over 100 years ago, and it’s derived from porcine and bovine animal sources. Given the live agent source, which introduces variability, and the volume of source material required to produce needed quantities, it is estimated that over 1 billion pigs are slaughtered each year to meet demand. Historically, an estimated 60% of the US supply has come from the intestine mucosa of pigs raised in China.
Manufacturing heparin is a complex and time intensive process designed to extract the needed materials from the mucosa from the animal source. Farm animals are known for many things, but cleanliness is not one. In fact, when epidemiologists study the progression of diseases, one of the biggest risk factors is if the virus can live within a porcine host as if it can survive and evolve within a pig, it’s a highly advanced and resilient virus. When you think of the source for Heparin, it’s no wonder that producing Heparin requires intricate extraction and purification processes and very high regulatory standards. Each of the many steps can involve a large volume of materials, numerous variables, and strict quality standards, making the supply chain difficult to replicate or shift quickly in response to disruptions or policy changes.
PE: What are the short-term solutions to prevent a shortage?
DeYoung: Addressing a potential shortage may require multiple strategies.
Regulatory action to grant tariff exceptions could ease immediate cost pressures. Some of the supply chain disruption today is due to the uncertainty, especially in the pharma industry where the tariffs, amount levied, and target (e.g., Active Pharmaceutical Ingredient or finished product) by country remains unknown. Providing clarity of intent can ease current tensions. Historically, tariffs on pharmaceuticals are rarely applied given the lifesaving nature of the good. Also, while pigs are not traditionally thought of as a part of the drug supply chain, they should be included in tariffs exceptions for pharmaceuticals because as in the case of Heparin, the farms that raise these pigs often raise them exclusively to source API. If there are tariffs on livestock for instance, it will affect the cost of the medicine.
Bovine heparin was used in the US until the 1990s when fear of Mad Cow disease largely pivoted the market to porcine sources. Porcine and Bovine heparin are processed (relatively) similarly so the supply chain would need to be altered, but it would open up additional trading partners and supply. This would require regulatory approval and updated quality control guidelines. If approved, the US pivoting back to Bovine sources could strain existing bovine suppliers to meet an even greater world demand especially as bovine sources may be less potent.
In parallel, accelerating the development of synthetic versions will help to future-proof the supply chain in response to geopolitical changes or in the event of contamination. This is not the first threat to the supply chain, and it won’t be the last, so investing in more diversified sources would deliver a strategic long-term advantage.
PE: Would synthetic, compounded, or generic versions of this drug be similarly impacted by tariffs?
DeYoung: Yes—particularly generics, as roughly half of those consumed in the U.S. are manufactured overseas, making them highly sensitive to trade shifts and tariff increases. The impact could raise costs by as much as 10%. Compounded drugs present a more complex picture, as tariffs can be assessed in various ways, including import value, consumer price, or third-party sale price. Even synthetic versions may face pricing volatility depending on how raw materials and APIs are treated under evolving trade policies.Some synthetic versions rely on the same API which would help scale available supply to more doses, and in doing so share costs across more products and doses to mitigate tariff impact on margin.
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