Good afternoon. My name is Collin Lee and I am the assistant director of clinical and educational services for the Department of Pharmacy at Emory Healthcare in Atlanta, Georgia. One of my primary job responsibilities for the past 20 years at Emory has been managing medication shortages. These shortages often occur with no forewarning and send our team scrambling to find and implement clinical alternatives while preserving patient care and safety at the same time. Today I'd like to give a quick review of the medication supply chain. I have two simple objectives. One is to outline the steps within the supply chain and then two to talk about the vulnerabilities that can occur within each of these steps. First I wanted to give you some context to the scope of formulary management within Emory Healthcare. We're an 11 hospital system comprised of both academic teaching and community-based hospitals in addition to our large Winship Cancer Institute and corresponding infusion centers. So you can imagine that we're purchasing and utilizing large volumes of medications. We have limited space so we often only have about a three to five day supply on hand across the system. So when a shortage hits we don't have a lot of time. We approach shortages from a system level where we work to share supply and implement changes across the system rather than having different mechanisms occurring at each of the entity hospitals. There's a lot of moving parts and a lot of resources that are dedicated to managing drug shortages. I've listed here the main steps within the supply chain and we will be discussing each of these steps in more detail over the next few slides. But first you have the manufacturers of both the raw materials and the active pharmaceutical ingredients. They then will send their product out to the manufacturers of the actual medication and these are usually different manufacturers. Manufacturers then send the medications on to wholesalers who distribute it out to the pharmacies. Some medications will be rerouted or repackaged into a more readily usable size or concentration before that actually then does come to the pharmacy. These two figures were released by the U.S. Food and Drug Administration in 2019. The figure on the left is a breakdown of where all of the medications utilized within the United States are manufactured. Less than a third of these medications are manufactured within the United States. The figure on the right looks at the manufacturing sites of just the 370 WHO designated essential medications. Here, the percent manufactured within the United States falls to less than a quarter. Many of these medications are generic and comparatively unprofitable to manufacture. We really need to have a global mentality on shortages because issues arising halfway around the globe will affect our ability to provide medications to our patients. Concentrating the manufacturing of a single critical medication in one specific area of the world is a significant vulnerability. Heparin is manufactured from pig intestines. Back in 2008, there was a major outbreak of swine flu in China. At the time, China was manufacturing 80% of the world's heparin and this resulted in a global shortage crisis. More recently, we have COVID-19 outbreaks occurring across the world. These result in strict quarantine shutdowns. Labor force illness call-out results in decreases in production. These labor force shortages also result in shipping and delivery delays. So what are some of the vulnerabilities that we see with the manufacturers of medications? So the first is money. So they have competing interest. They only have so many manufacturing plants and they're going to want to use those plants to make the more specialized and lucrative medications rather than the generic medications that are more widely used across the world. Competitive contracting. So the more manufacturers that are making a particular medication, the more significantly the price is going to be driven down. And so to the point where the manufacturers is just going to leave the market and no longer make that medication. When it comes to demand, manufacturers also have scheduled down times for cleaning or routine maintenance. The demand may increase during this time period without the ability to increase supply. When new data emerges on a particular treatment, there can be drastic market changes. We saw this in the last few years when it came to COVID-19. When data emerged that dexamethasone and ascorbic acid may be effective in the treatment of COVID, shortages of these medications quickly followed. Lack of transparency. Manufacturers are actually not required to disclose to the pharmacies where they are manufacturing certain medications. Now, from a safety standpoint, we could see why that may be needed. They aren't going to want to tell the world where they're making all of their fentanyl. But their lack of insight really leaves pharmacy in the dark. And so when there are natural disasters or other issues that occur throughout the world where these plants exist, we can't predict what shortage is going to be coming as a result. And then there's no prior disclosure of discontinuation. So if a manufacturer decides that they no longer want to make a medication, they can just leave the market as long as there are other manufacturers who are still on the market making it. But this often leaves a hole where these other manufacturers can't meet usual demand. As an example for a misjudgment on demand, several years back, one of the major manufacturers of the large volume perennial bags scheduled a temporary routine shutdown for cleaning and maintenance. And despite pre-planning and thinking that they had made enough to get us through that time period, there was an unprecedented flu season that year and demand skyrocketed. And we were unable to meet demand. Another example of this is when Hurricane Maria hit Puerto Rico in 2017, destroying manufacturing plants, resulting in a variety of shortages, particularly the small volume IV bags that we would use to make IV piggybacks. So the manufacturers will send their medications to large wholesaler distribution centers across the country, who then distribute it out to the various pharmacy. Benefits of a wholesaler are one-stop shopping. Instead of the pharmacy having to place orders with 200 different manufacturers to get 500 medications, they can send one order to the wholesaler for all 500 medications. They'll pull those off their shelf and send them all to us in one great big order. The other benefit is the more medications that you purchase through the wholesaler, the higher volume discounts you're going to get. So it benefits a pharmacy to have one primary wholesaler through which they put their volume of medication. You also get prioritization. So you're an established customer of the wholesaler. So during times of shortages, your wholesaler is going to ensure that all of your needs are met before selling any supply that they have to other pharmacies who are not a usual customer. They also have your purchase histories. So when manufacturers put medications on allotments, so that they only send the wholesaler a certain allotment, the wholesaler can quickly tell you whether or not they're going to be able to meet your usual needs. And if they can't meet your usual needs, they usually can tell you that they're going to be able to meet your usual needs. So if they come back and say, we can meet 80% of your usual need, then we know that we only need to make smaller mitigation strategies to save about 20%. But if they come back and tell you that they can only meet 40% of our need, then we quickly know that we need to make lower mitigation strategies to save about 20%. So what are some of the disadvantages or vulnerabilities in utilizing wholesalers? So the first is lack of diversity. If you're a wholesaler is not receiving shipments and other wholesalers are, they're not going to be able to meet your usual needs. So what are some of the disadvantages or vulnerabilities in utilizing wholesalers? So the first is lack of diversity. If you're a wholesaler is not receiving shipments and other wholesalers are, the other wholesalers aren't going to sell their supply to you because you're not an established customer. They're going to be protecting their supply for their own customers. It often benefits a hospital or a pharmacy to have a secondary wholesaler where you choose a percent of your volume orders and you put it through a secondary wholesaler. So now you'll have two sources in which you'll be able to obtain medications in times of shortage. Once product hits the wholesaler, you aren't necessarily guaranteed supply. It's a first come first serve ordering process. That wholesaler has a lot of customers who are all going to want to get to that supply. So if you're a smaller hospital or smaller pharmacy in which you do not have dedicated personnel that are at the computer all the time to be able to order it when the wholesaler releases it, you may have missed out on that supply coming. The other is warehouse location. Your warehouse may be hours away or in a different state. So there's going to be additional delays in getting that product to you, especially in times where they may be ice and snow storms or other weather that comes through that would prevent it from getting to you. In severe shortages, the manufacturer sometimes takes complete control over the medication and the pharmacies must order it directly through the manufacturer. So whether or not that you had a wholesaler as your primary distributor to begin with, you no longer can get it through them and you have to go directly through the manufacturer. When medications go on shortage, it's usually the most commonly utilized sizes and concentrations that are likely to be out of stock. So if I use fentanyl as an example, we no longer can get the 2 ml and 5 ml sizes, but the 10 ml and 20 ml sizes are still readily available. From a safety and waste standpoint, we don't want to dispense 20 ml vials to nurses to use for 50 microgram doses. So what we'll do is we'll send these vials to a repackager who will take that 20 ml vial and make 10 2 ml vials. If we try to do this within our pharmacies within the hospital, that syringe will only be good outside of the refrigerator for 24 hours. But if a repackager does it, they have more rigorous testing and clean room standards. So that same syringe now would be good outside of the refrigerator for three months, which would allow us to have those fentanyl syringes available out in the patient care areas. But we will pay a premium for those syringes. Additionally, once the repackager draws up that syringe batch, they must stay there for a few weeks until their stability and sterility testing returns before they can release that batch to us. So that's an additional three to four week delay before we can get them. If a pharmacy doesn't already have a contract with a repackager, then it's an additional months of legal hoops to go through to get that contract signed. These repackagers are also competitors for the same products that we want, because they want to be able to keep in business by making syringes. When you use a repackager, it doesn't go through the wholesaler as you purchasing that supply. So when a shortage hits, you won't get priority from the medication from the wholesaler, because they don't have a purchase history from you. So in that case, it's really best for a pharmacy to buy the supply through the wholesaler and send it to the repackager to repackage it for you so that you do have that supply of the medication that you need. And you don't have a purchase history with the wholesaler for purchasing that medication. And in all transparency, we pharmacies are part of the problem. So when we get any type of notice a shortage is occurring, we're going to want to go out and purchase a two month buffer supply. And we're going to deplete the wholesaler because we have no idea when supply is expected back. And we don't know the exact date when supply will be back. That often isn't the real date. And it can be weeks and months after that before any product returns. And then we'll start thinking ahead, what are we going to do? What if we run out? And then we'll buy up the alternative to. Pharmacies typically don't have adequate space to house all of this extra supply. Remember, we typically only have a three to five day supply on hand of any medication on our shelves. So when there's a stock out at the wholesaler, we don't have time to figure it out. And we don't have places to store whatever we do get in. Having a large scale offsite warehouse with resources to rotate a larger supply on hand would really be the only best way to insulate pharmacies from the significant impact of these shortages. So to summarize, multiple vulnerability points exist within the supply chain. And these vulnerability points are often multifactorial, whether it be natural disasters, workforce disruptions, shipping delays, manufacturing production decisions, they all contributed to shortages. And pharmacies need to find a way to quickly adapt and mitigate these drug shortages. And ultimately, we need improved manufacturer transparency and some established legal mandates on preemptive prioritization and contingency plans for when these medication shortages occur. And I thank you for your time today.

medication supply chain

medication shortages

transparency

wholesalers

contingency plans