FDA Braces For Drug And Medical Supply Shortages From China

Zero Hedge – by Tyler Durden

With every week its economic disintegration is not reversed, China is triggering the most massive supply chain “shock” the world has seen since the last financial crisis, now spreading from East to West.

The next impact won’t just be Europe, which we’ve already mentioned the closure of a Fiat Chrysler Automobiles plant in Serbia, but will be America and could first be in the form of drug and medical supply shortages. 

The FDA warns, “we are keenly aware that the outbreak will likely impact the medical product supply chain, including potential disruptions to supply or shortages of critical medical products in the U.S.”

A shortage of medical products from China would be disastrous for America’s aging population and fragile economy.

The agency said it has spoken with global regulators and has added additional resources to surveil for “potential disruptions or shortages.”

The good news:

“It’s worth noting that there are no vaccines, gene therapies, or blood derivatives licensed by the FDA that are manufactured in China,” FDA Commissioner Stephen Hahn said in a statement.

The bad news:

“Raw materials used in manufacturing do come from China and other locations in Southeast Asia and we are in contact with biologics manufacturers to gauge any supply concerns regarding raw materials,” Hahn said.

If a potential shortage is identified of medical products, the agency said it would act “swiftly and mitigate the impact to U.S. patients and health care professionals.”

We noted on Wednesday that China’s lack of workers – most of whom are holed up in their houses until the virus outbreak passes – has made factory restarts difficult.

The second problem developing, even if factory restarts are seen, companies don’t have enough money to cover labor expenses.

Shuttered factories in China delaying the production of medical products intended for consumption among America’s aging baby boomer population could be on the horizon.

The FDA is on high alert for supply chain disruptions and will notify the public and medical professionals if problems emerge.


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