Cecile Oger, Manager, Advisory Services

This summer, I conducted a number of interviews for one of BSR’s pharmaceutical member companies to examine, among other things, the critical topic of how to ensure continuity of supply, or prevent drug shortages. This is an issue dear to my heart professionally, but it became personal when my mum’s thyroid hormone-replacement treatment was suddenly no longer available in July. And while the situation was not life-threatening, I felt firsthand how a drug shortage can affect a patient’s life.

According to a recent report from the International Society for Pharmaceutical Engineering, drug shortages have a number of root causes, including issues related to quality (such as foreign particles in sterile drugs), manufacturing (caused, for example, by a fire at a plant, or by inadequate capacity), unanticipated shifts in market demand, and, of course, the industry’s complex global supply chain. Besides these issues, discontinuity of supply can also stem from natural disasters or pandemics. For instance, the 2011 earthquake in Japan created drug shortages far beyond the country’s borders. And avian flu outbreaks have the potential to decimate entire populations of hens, threatening the supply of fertilized eggs that are critical to the production of vaccines.

Pharmaceutical companies have been working for years to prevent, understand, and mitigate such risks through quality assurance systems and risk management structures, robust supply chain management practices (including developing long-term relationships with critical suppliers and avoiding single sourcing), and alternative technologies that limit shortages.

But shortages still happen. It is now time for more collaboration, and three approaches can help pharmaceutical companies:

  • Build multistakeholder initiatives: Pharmaceutical companies should work with governments, health providers, and other groups to improve communication, preparation, and predictability. For example, Canada recently launched the Protocol for the Notification and Communication of Drug Shortages to help companies noifty government and health providers early when they predict drug shortages.
  • Harness new technologies and partner with tech companies: By combining very different and complementary skillsets, such partnerships can increase understanding of drug inventories, making it easier to anticipate shortages and redistribute medicines to patients most affected by a shortage.
  • Collaborate on supply chain issues: Companies should work with their peers to minimize business continuity risks at critical suppliers. For example, by joining forces through BSR’s Pharmaceutical Supply Chain Initiative, member companies can address similar challenges with a similar set of suppliers, rather than acting alone. 

As stated in our recently launched Guiding Principles on Access to Healthcare, “The results of [pharmaceutical companies’] innovations are only of value to patients if they are available and accessible.” By increasing collaboration, the industry can be more effective in preventing or addressing shortages and ensure that patients can access the essential drugs they need.