The term API — or active pharmaceutical ingredient — has gained significant attention over the past eight months. APIs represent the critical aspects that make medicines work, from insulin to aspirin, so they can improve lives and keep our communities healthy. These ingredients, in addition to the excipients that serve as the medium for delivering the drug, are largely sourced from a variety of global locations — a vital supply chain that has experienced severe strain during the COVID-19 pandemic.

With dramatic reductions in manufacturing and shipping capabilities, pharmaceutical manufacturers in the U.S. quickly recognized the immense value of diversification on a global scale to reduce supply chain risk. As an article on API sourcing from the Drug, Chemical and Associated Technologies Association summarized in 2019, while the U.S. is the single largest pharmaceutical market in the world, it lags behind other countries in API production for drugs marketed in the U.S.

To help return reliability to the U.S. API supply chain, manufacturers can explore four potential modes of diversification:

  • Widening the supplier base — It’s vital for manufacturers to expand where their APIs are sourced to reduce reliance on one or two specific regions of the world. However, this seemingly simple solution is fairly complex. While over 1,000 API manufacturing facilities exist globally, very few facilities make the same API. In addition, building a facility or adding another process line can be difficult, as specific processes are typically proprietary to each manufacturing company.
  • Stockpiling API supplies — Increasing the storage capacity for critical APIs within the U.S. would reduce delivery timelines while providing needed security of having on-hand access to supply. However, the U.S. currently only stockpiles APIs used for medical countermeasures against biological, chemical, influenza and radiation threats. Therefore, larger-scale stockpile capabilities will require warehouse and distribution infrastructure upgrades, as well as technology improvements for cold storage and safe transport.
  • Onshoring more API manufacturing facilities — By expanding the supply chain of APIs for essential medicines into the U.S., stateside manufacturers could have better control over availability and quality. However, new facilities would require design, construction and approvals by the Federal Drug Administration (FDA), so the process would likely be extensive and costly.
  • Improving the manufacturing process — Continuous flow manufacturing enhancements could allow API manufacturers to create more products with the infrastructure already in place, reducing upfront costs and increasing efficiencies. However, the API manufacturing process is still complex, and doing it continuously, in lieu of batches, could further complicate the chemistry.

While it may prove challenging to implement one or any combination of these strategies to diversify the API supply chain, the long-term reliability benefits are worth investment. After all, the COVID-19 pandemic exposed the chain’s existing weaknesses, which need to be addressed now, before the next global crisis.

Fortunately, existing smart manufacturing solutions can make implementation smoother. And full-service firms, like Burns & McDonnell, can assist API manufacturers through every stage of a project life cycle — from determining the right approach to completion — to set up the U.S. market for success for years to come.


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Amber Yount is pharmaceutical department manager at Burns & McDonnell. Specializing in pharmaceutical manufacturing facilities, Amber has over a decade of experience in design and management of regulated facilities.