AAM survey: Pharmaceutical shipping costs spiked due to pandemic

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AAM survey: Pharmaceutical shipping costs spiked due to pandemic

By Sandra Levy - 04/30/2020

The cost of shipping pharmaceuticals to the United States has risen sharply as a result of the global coronavirus pandemic, according to a new survey of generic drug manufacturers conducted by the Association for Accessible Medicines.

The survey of AAM’s generic and biosimilar drug manufacturers revealed that travel and transport costs have skyrocketed 224% on average, with at least one manufacturer reporting as much as a 413% increase in shipping expenses compared to the same costs before the crisis. Generic drugs account for 90% of all prescriptions dispensed in the United States. 

As a result of the global slowdown and restrictions placed on international air travel resulting from the coronavirus pandemic, there has been a dramatic reduction in airline flights that carry pharmaceuticals and available cargo capacity. Government mandated work from home orders, along with unpredictable trade and export restrictions, have further exacerbated the difficulties supplying medicines during a time of significantly increased demand for treatments.

“The global pharmaceutical ecosystem is built on a highly complex supply chain,” said Jeff Francer, AAM interim CEO. “Despite serious challenges and increased costs in transporting needed medicines, manufacturers of generic and biosimilar medicines continued to deliver for America’s patients. However, this ongoing crisis illustrates the importance of developing new strategies and policies that enhance the pharmaceutical supply chain in the United States and increase our nation’s self-sufficiency.”

As the COVID-19 pandemic progresses, AAM said that manufacturers of generic and biosimilar medicines are working around the clock to ensure America’s patients have access to the medicines they need. Although the global pharmaceutical supply chain is straining under unrivaled stress and demand, the makers of 9 out of every 10 prescriptions filled in the United States are rising to the challenge.

AAM today also released a blueprint for Enhancing the Security of the U.S. Pharmaceutical Supply Chain, a a six-element framework that lays out concrete actions that the federal government could take to ensure that U.S. patients and the U.S. health care system have access to a secure and consistent supply of critical pharmaceuticals.

This blueprint builds upon the existing generic pharmaceutical supply chain in the United States, which produces more than 61 billion doses annually and provides more than 36,000 jobs in nearly 150 manufacturing facilities across the country.

“The generic pharmaceutical supply chain, which provides 90% of prescriptions filled in the United States, is demonstrating remarkable resiliency during the COVID-19 crisis, and AAM and its member companies are committed to applying the lessons that we have learned to make the supply chain stronger and more secure. The blueprint contains specific steps that Congress and the Executive Branch could take to create the capacity to manufacture critical medicines in the United States and allied countries, leading to increased national security, a reduction of dependence on any one country for key pharmaceuticals or their components, and an expanded employment base," said Francer.

To help stakeholders better understand the global pharmaceutical supply chain, AAM also has prepared a suite of tools and resources that can be found here.