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Pharmaceutical factories in China are resuming production lines but the halt in production could create drug shortages.
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Could the coronavirus spark drug shortages in the US?

The outbreak is exposing vulnerabilities in how America gets its drugs, but potential backlogs really depend on the course of the virus.

Jen Kirby is a senior foreign and national security reporter at Vox, where she covers global instability.

Some prescription drugs Americans rely on every day, including antibiotics, come from China or depend on ingredients that are made there. The coronavirus outbreak and measures to prevent its spread have disrupted manufacturing in China, taking factories offline that are only now slowly ramping back up. That’s all increased fears of potential drug shortages in the United States.

But how worried should we be? Experts say the answer largely depends on how long these disruptions continue in China and whether the outbreak becomes widespread in other countries critical to the drug supply chain, including India.

Drug shortages might not be felt immediately, as many companies stockpile ingredients or supplies to protect against unexpected stoppages, or have redundancies — meaning they rely on factories in different places — built into their supply chains.

And the reality is, with or without the coronavirus, drug shortages are a perennial problem in the United States. But an acute emergency like a virus outbreak, but also a natural disaster or a geopolitical event like a trade war, can threaten to make things worse.

“It does fit a kind of scenario we have worried about in the field for a while now,” Cornelius Clancy, an associate professor of medicine and director of the XOR pathogen lab at the University of Pittsburgh, told me. “It wouldn’t take much to expose the vulnerabilities in the supply chain.”

The FDA is monitoring for coronavirus-related shortages

The Food and Drug Administration (FDA), the US federal agency that regulates medicines among other things related to public health, announced last week that a drug manufacturer had alerted the agency of a drug shortage related to the novel coronavirus outbreak in China.

The FDA won’t disclose the name of the drug but said that it was recently added to the drug shortages list, and that patients would be able to find an alternative.

The agency also said that, since January, it has communicated with more than 180 drug manufacturers about potential disruptions because of the coronavirus and identified 20 drugs that might be vulnerable because they “solely source their active pharmaceutical ingredients or finished drug products from China.”

Stephen M. Hahn FDA commissioner speaks at a House Energy and Commerce Committee Health Subcommittee hearing on budget and oversight for the the coronavirus outbreak on February 26, 2020.
Brendan Smialowski/AFP via Getty Images

“We have been in contact with those firms to assess whether they face any drug shortage risks due to the outbreak,” FDA Commissioner Steven Hahn said in the statement. “None of these firms have reported any shortage to date. Also, these drugs are considered non-critical drugs.”

But fears of potential shortages emerged again when India announced that it would limit the export of some two dozen drugs or drug ingredients to make sure it had enough supply for its domestic population. A major exporter of drugs, especially generics, to the United States and Europe, India also relies on China to help make those medicines — particularly those active pharmaceutical ingredients, or APIs.

In a statement, Jeremy Kahn, a spokesperson for the FDA, told Vox that the agency is “currently conducting a supply chain analysis of the APIs mentioned in the India news report to determine where other API facilities around the world are located that supply the US market. This will help to identify any potential drug shortage concerns for these APIs.”

The FDA, he added, “will work to evaluate identified products for any shortage concerns.”

In other words: The FDA says it is on it.

Again, drug shortages are not unusual in the United States. The FDA currently lists dozens of drugs in shortage. But the coronavirus could exploit some of these already present vulnerabilities depending on how the outbreak unfolds over the next weeks and months.

Fears of drug shortages are partially driven by a lack of transparency

A lot goes into manufacturing medicines. There are the active pharmaceutical ingredients, which are the things that make an antibiotic effective in treating a bacterial infection. Then there are other raw materials needed for manufacturing.

So a particular drug you buy at your pharmacy may contain active pharmaceutical ingredients that come from one place — say, China — but the actual pill or cream or whatever the finished product is might actually be manufactured in India or any number of other countries, including the United States.

The number of facilities overseas, including in China, that manufacture active ingredients has increased. This has happened, of course, for many of the same reasons other manufactured goods have moved overseas: It is cheaper to make those products overseas, and some of the environmental regulations may be less stringent.

“The supply chain is much more globalized today than it was in the past,” Rachel Sachs, an associate professor of law who studies food and drug policy at Washington University in St. Louis, told me, “and that poses concerns in any international global health crisis like this one.”

But it’s still hard to know exactly how dependent the US is on places like China and India for its drugs.

Janet Woodcock, the director of the FDA’s Center for Drug Evaluation and Research, told a House committee in August 2019 that, based on the data available, the FDA “cannot determine with any precision the volume of API that China is actually producing, or the volume of APIs manufactured in China that is entering the US market, either directly or indirectly by incorporation into finished dosages manufactured in China or other parts of the world.”

Janet Woodcock, director of the FDA’s Center for Drug Evaluation and Research, at a hearing on February 4, 2016.
Brendan Smialowski/AFP via Getty Images

In other words, the FDA knows the number of facilities in China or Ireland or Mexico that are producing ingredients that go into drugs, but not what percentage of those overseas-manufactured ingredients ends up in an average American’s medicine cabinet.

What we do know, according to a 2019 paper from the National Bureau of Economic Research, is that almost 90 percent of the factories that make active pharmaceutical ingredients for the US market are located outside of the United States. And about 60 percent of the factories that manufacture the final products are outside the US. Again, this is not a percentage of US drugs made abroad, or the percentage that rely on ingredients from abroad. It is merely noting the location of the factories.

What makes this even more complicated is the lack of transparency, at least for the public. The FDA has said that the 20 drugs it is monitoring because of coronavirus are “non-critical” but won’t say what they are. And, as mentioned above, the FDA won’t say what the drug currently facing a shortage due to the coronavirus actually is. FDA Commissioner Hahn said at a Senate hearing last week that the FDA could not make it public because of “confidential commercial information.”

This is frustrating in its own way because if you’re someone who relies on medication, not knowing what’s in shortage can create its own type of panic.

Erin Fox, a University of Utah expert on drug shortages, told me that under the law, US drug companies have to tell the FDA when they anticipate a drug shortage at least six months ahead of the shortage, or as soon as possible if for some reason they can’t meet that standard. However, Fox explained that companies aren’t obligated to say the reason for the shortage.

But all of this means it’s actually pretty hard for you, as an American consumer, to know whether the medication you’ve been prescribed is reliant in some way on materials made in China or made in a factory in India or anywhere else.

“It’s just literally the one thing that we buy in the US that we have literally no information about,” Fox told me. “You know more about your water bottle that you’re going to buy or your clothing or your food than you know about purchasing a drug.”

Okay, so what’s the bottom line here? How worried should I be?

As with all things related to the coronavirus, don’t panic.

But overall, experts said that, yes, potential drug shortages are a concern, especially if the coronavirus outbreak continues to affect manufacturing in China, and even more so if the outbreak goes farther afield, particularly if it threatens India’s drug production.

“If the coronavirus spread to India in a large way, and you started having Indian pharmaceutical facilities go down at the same time you had Chinese pharmaceutical facilities go down, that would cause significant shortages in the US,” Howard Sklamberg, a partner at the global law firm Akim Gump and a former deputy commissioner at the FDA, told me.

“In other industries,” Sklamberg explained, “companies can try to shift their supply chains” elsewhere if there’s a disruption in one country. “With drugs, that’s just more difficult.”

It takes effort, no matter what, to shift an industry’s supply chain. But drugs go through a critical extra layer of approval, which slows things down. And while the FDA can absolutely expedite those applications and inspect new facilities, “That’s just not something you can do overnight,” Sklamberg said.

Customers wait for a Boots pharmacy to open on March 8, 2020, in Cardiff, United Kingdom.
Matthew Horwood/Getty Images

Now for the good news.

Rena Conti, a health economist at Boston University, told me that because drug supply chains are so diffuse and complex, pharmaceutical companies are aware of the potential vulnerabilities. That includes quality issues, contamination issues, weather events, or natural disasters. And, especially recently, vulnerabilities related to tariffs or trade policies.

Many drug companies have backups in place. For instance, they may have separate suppliers, or they may stockpile extra inventory. So for some drugs, it means shortages may never happen, even if facilities face coronavirus-related snafus.

And even for those drugs that are at risk of a shortage because of an event like coronavirus, it is likely to take some time for these backlogs to work their way through the system — and, if this crisis is short-lived, consumers may never experience them.

The federal government also has backups in case of an emergency. The US keeps a Strategic National Stockpile of some critical drugs and medical supplies, from vaccines to face masks. Though it was established in case of a bioterrorism event and doesn’t have enough supplies for every citizen, it’s there. Many local and state governments also stockpile vital drugs.

All this is for worst-case scenarios, and drug shortages can cause problems for patients and people long before there. But the US and the rest of the world is still a long way from the most dire situation. “Yes, we’re vulnerable,” Conti told me. “But we’re not as vulnerable as some people expect.”

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