What Impact will FDA's ANDA Prioritization Pilot have on the Global Supply Chain?

Pharmaceutical Executive: What impact will FDA's ANDA Prioritization Pilot have on the global supply chain?
Marcel Botha: We saw consolidation during the pandemic. While it might have had some cost-savings implications, it exposed us to extreme risk. In the recent past, we saw the supply-chain issues. Recently, we’re seeing geopolitical and tariff related issues.

We’re seeing flows of product between Russia and Europe be interrupted, along with the flow of product between the US and China. It’s not just from what happened during the pandemic, but it’s also stemming from various areas of unrest.

This pilot could spur pharmaceutical ingredient production and drug manufacturing to be reinvested at scale. Bringing in automated systems into that investment will provide the opportunity to launch large scale automation and cost benefits.

PE: What impact will FDA's ANDA Prioritization Pilot have on efficiency and competitiveness?
Botha: Setting up new manufacturing is hard. You can’t be an overnight success in pharma production. What is gained in terms of outsourcing will be matched and replaced by being able to distribute manufacturing across the US.

We will be able to control supply chains and cost structures and obtain real-time data. We’re seeing a lot of investment in data in US manufacturing, especially in pharma, that give execs the ability to see in real-time how their projects are doing.

PE: What policy incentives are created by FDA's ANDA Prioritization Pilot?
Botha: Right now, we’re seeing multiple efforts made on the policy incentive front. There’s an accelerated facility approval plan, which would make it easier and transparent to onboard new manufacturing facilities.

There is accelerated drug approval pathways for bringing new generic drugs online in the US. The combination of both US-based manufacturing and supply chains for APIs put companies in the front of the line for FDA review and accelerates time to market.

PE: What will the broader impact be?
Botha: I think it will have an immensely positive effect. During the pandemic, we saw extreme bottlenecks due to consolidation of the drug industry.

If we look at pharmaceutical production, there were a few mega-players (predominantly in India and China) supplying drugs to rest of the world. When the supply chain broke down, so did drug access.

The new pilot will hopefully reinvigorate domestic, US-based drug production.

PE: What can healthcare manufacturing learn from FDA's ANDA Prioritization Pilot?
Botha: The broader lesson stems from the pandemic. The supply chain risks have not been resolved at scale in the US.

The geopolitical risk from the Ukraine Ware and the tariff trade-war are all impacting our supply chain. We rely on various forms of sourcing from all over the world.

Investing in US-based supply chains, from source components to final assemply, is a very valuable step for the US to take.

It’s not a single, one step solution. It’s not going to happen overnight, and it’s going to require a commitment from multiple administrations in order to work.

PE: How long will it take for the market to be impacted by FDA's ANDA Prioritization Pilot?
Botha: It’s a relative window. It depends how much risk is out there. The US-based innovation system is very capable of responding in real time when it matters.

Many players showed that during the pandemic. However, if we’re not incentivized in the right way (either from extreme duress or policy hurdles), that will slow it down.

We’ll see immediate movement, but we won’t see scale for five to ten years. We are seeing smaller players leveraging these various incentives in a way that is more agile than the larger players.