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    Pharma Beat

    Supply Chain Disruptions

    The implications of Sandoz’ recent recalls.

    Supply Chain Disruptions
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    Ed Silverman, Guest Columnist10.15.19
    When Sandoz announced last month that it was halting worldwide distribution of heartburn medicines containing high levels of a possible carcinogen, the company also issued a recall in some European countries and Canada, but not the U.S.

    Why?

    The drug maker, which is the generic arm of Novartis, was still working with the U.S. Food and Drug Administration (FDA) to test its medicines. The company noted that the same active ingredient—ranitidine—was purchased from different suppliers, which required separate testing to determine the extent to which the impurity, known as NDMA, appeared in any, or all, of its existing inventory.

    Within a week, though, Sandoz did recall its heartburn medicine from the U.S., after testing indicated NDMA was found “above levels” established by the FDA in batches of its capsules. NDMA, which is an organic chemical once used to make rocket fuel, is an unintended byproduct of certain chemical reactions. The World Health Organization (WHO) classified it as a possible carcinogen to humans.
    The episode is hardly over, though.

    A growing number of countries are now requiring manufacturers to halt distribution of their heartburn medicines or enacting an outright ban. Meanwhile, NDMA was also found more than a year ago in one type of blood pressure pills, commonly known as sartans, prompting numerous manufacturers to issue recalls as regulators in the U.S. and Europe continue investigations.

    This one-two punch has intensified concerns about the global pharmaceutical supply chain and, in the process, placed added pressure on regulators while raising questions about the extent to which drug manufacturers should be relying on active pharmaceutical ingredients (APIs) made in Asia.

    There is a dilemma, however. An estimated 80% of ingredients come from China and India. This is hardly surprising, since the lower cost of goods makes it still easier for a drug maker to justify an investment in its own expensive equipment and infrastructure, which is also complicated to install and maintain. 

    Meanwhile, though, the FDA has been issuing a growing number of warning letters and 483 inspection reports over the past few years to suppliers in those countries due to a potpourri of quality-control gaffes. Some violations are so egregious or unusual—shredding documents, preventing FDA inspectors from gaining entry—they generate outsized attention in the business press.

    The question, then, is how do we halt this trend? Not surprisingly, there are no easy answers.

    First of all, let’s remember that not every impurity or subsequent recall is caused by a manufacturing issue. For instance, there are two sources of NDMA. In the blood pressure pills, certain solvents were not extracted properly during the manufacturing process.

    But in the ranitidine heartburn pills, there may be an issue with a metabolite of the drug itself, which may disintegrate, depending on storage conditions, although there is disagreement over this point and the FDA argues that testing methods may yield different results.

    Nonetheless, there is growing anxiety over APIs. Arguably, the surest way to fix this problem is for more drug makers—the big brand-name companies that have deep pockets and long-standing reputations to protect—to invest in producing more ingredients themselves.

    This is probably a tall order, though. After tax benefits for maintaining facilities in Puerto Rico began evaporating in recent years, many of these companies gradually shifted focus and began procuring more active ingredients from other countries.

    What might it take to entice big pharma to invest in more facilities in the U.S.? Perhaps some form of legislation—at least pertaining to medicines deemed vital for national security—may have some affect. But more likely tax breaks or some other financial incentives would be needed, which could have the added benefit of creating jobs and bolstering local economies.

    Even then, it will still take time to get to the point where we have a ‘Made in the USA’ supply of ingredients to any meaningful extent. This is not the sort of undertaking that happens overnight. Remember that building or retrofitting a plant requires regulatory oversight and inspection, which can take two years or so. This is a capital intensive effort. Besides, no one company can be expected to make a huge difference on its own.

    An alternative is for the FDA to run more unannounced inspections, which the agency stopped doing a few years ago. But that would take more resources and, certainly in some cases, diplomatic efforts that require diligence. Even then, there are so many facilities in places such as China and India that this approach may really just be a band-aid.

    Instead, we may need to change our thinking about quality and require companies to do more testing. Although batch testing is done and reported, there is often months of lag time. What might make more sense—at least from the standpoint of added safety—is to require minimum testing of each ingredient for each medicine. This is how Valisure, the online pharmacy that also runs a lab, found what it claims are the problems with the ranitidine heartburn meds. Otherwise, we are left with an imperfect honor system.

    Of course, even this approach is not foolproof. Most of the problems involve generics and, when it comes to quality control, enough of the generic suppliers in India and China are, literally, repeat offenders. Relying on them to do more frequent and complete testing is no guarantee that the situation will improve.

    In short, there is no simple answer. But mandating more testing and providing select incentives to generate a better supply of ingredients, has got to be better than the position in which we find ourselves now. Otherwise, we may be left with an ongoing problem that will never resolve itself.


    Ed Silverman
    Guest Columnist

    Ed Silverman writes the Pharmalot column for STAT, covering the latest news and views about the pharmaceutical industry. He previously worked at The Wall Street Journal and The Star-Ledger of New Jersey, and was a regular columnist at Contract Pharma. Follow him on Twitter @Pharmalot.
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