Biden Pushes Policy Changes to Protect Pharmaceutical Supply Chain

The White House, the HHS Office of the Assistant Secretary for Preparedness and Response (ASPR), and FDA recently released policy recommendations to protect US pharmaceutical supply chains. 

The pharmaceutical supply chain is complex and highly influenced by market factors that have led to an increasing reliance on foreign countries to manufacture medicines. 

The White House, ASPR, and FDA highlighted that Congress should focus on two priority objectives to address the overall reliability of the pharmaceutical supply chain. 

The first objective is to improve supply chain transparency and incentivize resilience. Policies should seek to provide increased transparency to distributors and purchasers of the sources of drug manufacturing and the quality of the facilities that make them.

And the second objective is to increase the economic sustainability of US and allied drug manufacturing and distribution. 

This includes providing predictability in production costs, pricing, and volume sold; increasing government and private sector flexibility in contracting and sourcing of finished drugs; and studying whether the current market for finished drugs supports diversification of supply.

Additionally, a strategic approach that consists of three key elements to promote domestic growth, equity, and resilience in the pharmaceutical supply chain is needed. 

This strategic approach includes: 

• Boosting local production and fostering international cooperation
• Promoting research and development that establishes innovative manufacturing processes and production technologies to strengthen supply chain resilience
• Building emergency capacity
• Increasing information available to FDA to improve surveillance and shortage prevention and mitigation efforts

The White House, ASPR, and FDA divide their recommendations into six categories.

Long-term competitiveness will require an ecosystem of production, innovation, skilled workers, and diverse small and medium-sized suppliers. Therefore, the organizations’ first recommendation is for Congress to rebuild protection and innovation capabilities.

Congress should provide dedicated funding for semiconductor manufacturing and research and development, provide financing across the full battery supply chain, establish a new supply chain resilience program, and invest in the development of new pharmaceutical manufacturing and processes.

The second recommendation is to support the development of markets that invest in workers, value sustainability, and drive equality.

For example, Congress should create 21st century standards for the extraction and processing of critical minerals, identify potential US production and processing locations, and improve transparency throughout the pharmaceutical supply chain.

The third recommendation is to leverage the government’s role as a purchaser of and investor in critical goods. 

Specifically, Congress should use federal procurement to strengthen the US supply chain, strengthen domestic production requirements in federal grants for science and climate research and development, and reform and strengthen US stockpiles.

The organizations fourth recommendation is to strengthen international trade rules, including trade enforcement mechanisms, as well as establish a trade strike force and evaluate whether to initiate a Section 232 investigation on imports of neodymium magnets. 

Under the fifth recommendation, the organizations stated that Congress should work with partners to decrease vulnerabilities in the global supply chain and expand multilateral diplomatic engagement.

Finally, the last recommendation is to monitor near-term supply chain disruptions as the economy reopens from the COVID-19 pandemic.

This includes establishing a supply chain disruption task force and creating a data hub to monitor near term supply chain vulnerabilities. 

“Pharmaceutical supply chains are essential for the national and health security and economic prosperity of the United States, yet the COVID-19 pandemic revealed just how vulnerable the supply chain is in this country. Now is the right time to take action to keep the U.S. drug supply chain secure and resilient,” FDA Acting Commissioner Janet Woodcock, said in the announcement.

Woodcock stated that a secure, resilient supply chain will continually meet the diverse health needs of patients and healthcare providers during emergencies, as well as on a daily basis. Additionally, it will provide valuable US jobs that bolster the economy.