Andrew Badrot, CEO of C2 PHARMA, speaking on how the pharma industry has responded to the COVID-19 pandemic, a Pharma's Almanac Q2 issue
Andrew Badrot, Chief Executive Officer, C2 PHARMA
A: The pharma industry has responded extremely well to the COVID-19 pandemic. Considering the unprecedented scope of the pandemic, all aspects of pharmaceutical supply chain contingency planning have come into play, and to date only a single drug was reported in shortage due to COVID-19 in the United States. Safety stocks across the pharmaceutical manufacturing network and warehouses have kicked in, and supply to pharmacies has been uninterrupted. This will not be indefinite and, should the lockdown extend many more months, one can expect a cascade of shortages. Nonetheless, the system has proven resilient and able to cope with a crisis.
The pandemic has laid bare the limits of the current pharmaceutical manufacturing model and its heavy reliance on China for starting materials and to a lesser extent for APIs and drug products. This reliance has become both a strategic and an operational challenge: strategic, as both the United States and the EU now consider China a strategic competitor, at the same geopolitical level as Russia; and operational, as solidarity between countries has more or less broken down and export restrictions from China and India have raised the stakes for the rest of the world.
I would advocate focusing on removing any incentives — and perhaps even creating economic barriers — to importing essential drugs. This could include import duties or establishing incentives that support local manufacturing. Regulations could also be established via the military industrial complex to mandate use of locally made products. A combination of approaches can be very targeted and simple to implement with focus. By creating a stable economic environment, countries will have what they need to establish sustainable manufacturing for essential APIs and drug products in the United States, Europe, Japan, and other countries who wish to establish independent supply chains.
We should create transparency via drug product labels and a publicly accessible database displaying the country of origin for both the API and the drug. This way, patients can be given relevant information for them to be selective about where their drugs are manufactured.
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