Critical drug shortages on the rise due to lack of supplier diversity

An over-reliance on China and India for critical drug supplies means drugs shortages are increasing, resulting in lower standards of patient care.

Hospitals in the US are witnessing shortages of cancer drugs, prescription medications, and children’s flu medicine due to a lack of geographical diversity of suppliers, according to a report by the US Senate Committee.

The report, Short supply: the health and national security risks of drug shortages, found patients were facing delays in treatment and increased risk of medication errors due to the shortages, and found doctors were rationing lifesaving treatments. 

The report said: “Just-in-time manufacturing practices, overreliance on both foreign and geographically concentrated sources for critical drug products, and insufficient supply chain visibility, among many other challenges, have resulted in widespread shortages of critical drug products over recent decades.”

Sources of active pharmaceutical ingredients, the key component of medications, are overwhelmingly concentrated in China and India, it said.

Nine in 10 (90-95%) of generic sterile injectable drugs for critical acute care in the US rely on key starting materials from China and India, the report found. India possessed 62% of the global manufacturing capacity of active pharmaceutical ingredients in 2021, while China stood at 23%, and the US just 4%, it noted.

Moreover, the Food and Drug Administration said it had little visibility into pharmaceutical supply chains, as data is “unstructured” and “buried in PDFs”, creating further risk. 

The report said the industry has a “false appearance of diversity”, as the complexity of global pharmaceutical supply chains and lack of solid data has resulted in US buyers not knowing if the manufacturers all sourced from the same raw material suppliers.

The report said the federal government and industry could take five key actions to mitigate shortages.

1. Invest in domestic manufacturing capabilities: Public-private partnerships should be used to incentivise strategic onshoring and improve advanced manufacturing capabilities for shortage-prone drugs.

2. Conduct regular supply chain risk assessments: Cross-agency collaboration on risk assessments could improve the ability of the federal government to identify and mitigate medical vulnerabilities.

3. Require demand reporting: Manufacturers should be required to report increases in demand, as well as export restrictions and drug delivery fulfilment rates in order to increase supply chain visibility.

4. Develop data capabilities: Establishing a materials database would enable the FDA to assess end-to-end supply chain visibility more effectively, improving shortage mitigation efforts.

5. Streamline supply chain mapping: A coordination of effort between the public and private sectors to map the entire pharmaceutical supply chain would allow stakeholders to proactively identify vulnerabilities.

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Drug shortages *are* increasing, lasting longer, and having a greater impact on patient care,


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