The Impact That the Renewed Focus on Domestic Manufacturing Might Have on the Supply Chain

Drug shortages remain a difficult to fix issue for the pharma industry and are an issue that can have devastating results. Often times, shortages hit because of an increased demand for the medication, leaving patients waiting for gaps in the supply chain to be filled.

Pharmaceutical Executive spoke with Marc Wagner, an FDA and life sciences attorney at Fox Rothschild, about the manufacturing and regulatory pressures that contribute to drug shortages. According to him, these shortages happen for a variety of reasons and there is single fix.

Instead, there are multiple steps the industry must take to prepare for increases in demand and pipeline disruptions. A major issue is the industry’s dependence on overseas production, which leaves the supply open to global pressures. According to Wagner, a majority of generic drug products are manufactured outside of the US, meaning that these sites may not be unable to pick the slack.

Pharmaceutical Executive: What impact will the renewed focus on domestic manufacturing have on the supply chain?
Marc Wagner: Increasing domestic manufacturing — onshoring the production of pharmaceutical products in the United States — is certainly one important step toward further mitigating drug shortages. It is not a complete solution on its own, but it is a meaningful move in the right direction.

From a regulatory standpoint, the FDA simply has more resources to inspect domestic facilities than foreign ones. It is straightforward logic: an inspector traveling halfway around the world to conduct an inspection requires more time and more resources than an inspection of a domestic facility. Greater domestic manufacturing presence means more accessible, more frequent, and more efficient oversight.

Bringing API manufacturing back to the United States would further reduce shortage risk. As I noted earlier, pharmaceutical supply chains — and the supply chains for the ingredients that go into pharmaceutical products — are highly complex. The more we can localize those supply chains, the fewer opportunities there are for something to go wrong at any point in the manufacturing process.

Domestic manufacturing alone is not the complete answer to drug shortages, but increasing it and diversifying it will meaningfully reduce the risk.