White House Recommends Strategies to Pharmaceutical Manufacturers to Enhance Supply Chain Security and Resiliency in the USA

 White House releases a report on June 8, 2021, which consolidates supply chain assessments for industrial manufacturing advanced packaging, high-capacity batteries, critical and strategic defense materials, and pharmaceutical ingredients in the USA. The report, entitled Building Resilient Supply Chains, Revitalizing American Manufacturing, and Fostering Broad-Based Growth, evaluates supply chain vulnerabilities in America’s supply chain and proposes policies and strategies to different departments in this post, we will focus on recommendations made to the Department of Health and Human Services for pharmaceuticals and active pharmaceutical ingredients (APIs).

The report highlights an approach in terms of international cooperation and partnerships to enhance supply chain security and resiliency in the country. It is essential to strengthen the United States' national and economic security and technological leadership. According to this report, the following factors contribute to supply chain vulnerabilities in the country across all sectors:

·         Insufficient U.S. manufacturing capacity

·         The current U.S. investment market is rewarding to firms for quality, sustainability, or long-term productivity. The market is focused on maximizing short-term capital returns, which results in long-term resilience.

·         U.S Domestic competitiveness has declined due to underinvestment in the domestic industrial base.

·         Key supply chains are concentrated in nations like India and China due to geographical and demographical advantages

·         Underinvestment in international diplomatic efforts for supply chain security

The report acknowledges that the U.S. is lagging in domestic manufacturing and cannot produce all necessary products. The country should focus on expanding domestic manufacturing with supplement efforts and international cooperation to enhance supply chain security and resilience.

What’s there for Pharmaceuticals and APIs in the report

The review of pharmaceuticals and APIs for the Department of Health and Human Services (HHS) primarily focused on the supply chain for therapeutic biological products and small-molecule drugs. it doesn’t focus on supply chains for blood products, vaccines, cell therapies, and their APIs.

In its review, the Department of Health and Human Services (HHS) identifies the following features to establish a robust pharmaceutical supply chain for a long-term plan:

·         High-quality product manufacturing

·         Supply chain diversification

·         Supply chain redundancy

·         A flexible supply chain structure to meet supply and demands 

The HHS’s review prioritizes two objectives that need to be addressed in order to improve the reliability of pharmaceutical and API supply chains in the U.S. market.

·         To improve supply chain transparency and incentivize resilience for the quality of drug manufacturing.

·         To increase the economic sustainability of drug manufacturing and distribution to provide predictability in productions and demands. 

The HHS feels the need for a rigorous assessment of benefits and costs across the healthcare system, encouragement stakeholders for domestic investments, and market-based mechanisms to provide a more sustainable and resilient supply chain for pharmaceutical and APIs.

HHS sets a strategic approach through some recommendations to promote domestic growth, equity, and resilience in the pharmaceutical supply chain. The Department of Health and Human Services feels that there is a need for collaboration with the federal government, the private sector, and other non-governmental stakeholders to:

·         Boost Local Production and Fostering International Cooperation

·         Build Emergency Capacity

·         Promote International Cooperation

Pharmaceutical manufacturing and distribution companies should monitor these reviews and recommendations in order to enhance supply chain capability, security, and resiliency for overall growth. These companies should look for financial and market opportunities through investment and disinvestments in partnership with firms seeking to invest and build underperforming and non-core manufacturing and distribution companies with advanced manufacturing technologies. 

American Industrial Acquisition Corporation (AIAC), a global investment firm based in New York and founded by Leonard M. Levie, seeks to invest in the pharmaceutical sectors through acquisition opportunities to meet the financial commitments of underperforming companies. It is a great opportunity for pharmaceutical manufacturing companies to restructure and rebuild themselves through a disinvestment process to enhance supply chain security and resiliency in the U.S.

What does it mean to streamline the manufacturing and packaging of OSDs for pharma companies?

 The pharmaceutical industry has already been under immense pressure to reduce drug development timelines and related costs long before the pandemic. However, with the rise of the Covid-19 pandemic, challenges have gotten even more difficult for the industry. That’s why many medicine developers are choosing to manufacture and package oral solid dose (OSD) with the help of contract manufacturing organizations (CMOs). 

What Makes CMOs for OSD Manufacturing and Packaging a Cost-effective Choice?

Many drug development challenges, like the more complex nature of new molecules and their bioavailability, formulation, stability, manufacturability, and scalability make the production of OSDs even more complicated. CMOs not only brings expertise in manufacturing of OSDs but also offers the advantages of access to advanced technology, state-of-the-art manufacturing facility, formulation ideas, and processing innovations to pharmaceutical companies.

However, in general, pharmaceutical companies outsource their OSD manufacturing and packaging projects to two different contract manufacturing organizations. It is because most CMOs handle either OSD manufacturing or OSD packaging but not both. While this is a viable solution to get the manufacturing and packaging of OSD products done cost-effectively, outsourcing these operations to two different CMOs has its own drawbacks. 

Why collaborating with two CMOs for OSD manufacturing and packaging is not the best solution?

Understandably, working with CMOs to manufacture and package your OSD products sounds like a good solution as you get the benefit of their expertise and cutting-edge technology they are equipped with at a fraction of the cost. But, connecting with two different CMOs also means you will need two different partners for management and two different supply chains.

In addition, the drug manufacturing company is required to mediate product transfer to another CMO. This, in turn, only adds to the time and cost of bringing OSD products to the market. 

The best solution to eliminate the need for two managing partners and different supply chains and reduce the cost and time of supplying the market with desired OSD products is to seek a contract manufacturing company that offers both - manufacturing and packaging solutions for OSD products.

Is there any CMO that offers manufacturing and packaging solutions for OSD in one place?

Yes. Undeniably, the complexity of the supply chain and associated issues has been brought into the brighter spotlight by the pandemic. The best way for pharmaceutical companies to weather this public health crisis is to integrate their supply chains to at least some degree. 

Working with a single CMO that complies with GMP requirements for both manufacturing and packaging of OSDs at a single site is the best solution for drug companies to streamline their operations and optimize their resources for each project. It will help drug and pharmaceutical companies to get their OSD products faster to the market and ultimately to patients in need at more affordable rates.

Avara Pharmaceutical Services is an esteemed CMO based in Norman, Oklahama where manufacturing and packaging of oral solid dose (OSD) drug products are done under the management of one integrated team. The company’s Chairman and Director, “Leonard Levie” aims to tackle the current challenges and better prepare for a better future. The same vision he likes to imbibe in the culture of the companies he is a key part of. 

Consequently, Avara, supported by a strong safety, health, and environmental system along with Lean Six Sigma methodologies, brings a wealth of expertise and industry knowledge in various operations such as supply chain, commercialization, and technical transfer for faster and affordable production of advanced medicines.

This means collaborating with Avara enables pharma companies around the world to overcome their challenges and address the patients’ medical needs while reducing the overall cost.