Why Prescription Drug Shortages Occur

Drug shortages can occur for a variety of reasons and at a variety of points throughout the prescription drug supply chain. This can include manufacturing quality issues, production delays or possible delays in receiving raw materials and other components from suppliers. Disruptions from natural disasters and or public health emergencies also contribute. Beyond these core factors, workforce challenges, manufacturing infrastructure and policies in the Inflation Reduction Act could increase drug shortages. Generic drugs are particularly susceptible to drug shortages due to persistent economic challenges facing the generic industry.   


Preventing and Mitigating Shortages

Our industry is committed to continually enhancing quality manufacturing and works closely with the FDA, supply chain partners and health care providers to prevent and mitigate drug shortages of prescription medicines. All health care stakeholders must work together to continue implementing both short-and long-term solutions to enhance supply chain resiliency and prevent or mitigate drug shortages.

Biopharmaceutical companies have extensive measures in place to help prevent and mitigate potential drug shortages including:    

  • Globally resilient supply chains to help ensure continuous supply of innovative medicines to meet patient needs.
  • Robust inventory management systems that address:
    • Data on anticipated demand reflecting historical demand and supply data.
    • Mitigation plans for products and raw materials and the processes used for manufacture or distribution.
    • Logistics planning to ensure continuity in shipping of supplies.
    • Risk management strategies, including alternative manufacturing locations or distribution routes and channels, emergency planning, e.g., emergency power generation and inventory reserves and ongoing maintenance and modernization of manufacturing facilities and quality systems.


What policy solutions does PhRMA support to address prescription drug shortages and supply chain resiliency?

  • Public policies that spur greater infrastructure investments that could increase the resiliency of supply chains for medicines with a long history of drug shortages, such as generic injectables.
  • Working with trading partners to expand regional manufacturing capacity, as well as increased federal investments and public-private partnerships to support innovation in biopharmaceutical manufacturing processes.
  • Addressing the STEM workforce gaps critical to supply chain resiliency.
  • Tax and other investment incentives for new manufacturing facilities and the expansion and enhancement of existing facilities.

As of September 2023


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