Drug shortages, APIs supply & Pharma Global Value Chain

Introduction: The COVID-19 pandemic caused a worldwide shock on the Global Value Chain (GVC), and our society discovered the fragility of the pharma supply chains (PSC). The pandemic acted as a stress test revealing a situation that had existed for years: the problem of, access to essential medicines in poor countries, and drug shortages (DS) in rich countries. But, a systematic review of the literature on DS and PSC revealed that academic studies are scarce. Objectives: The aim of the research is to (i) compare national trends and characteristics of DS and its impact in media, (ii) understand the PSC by identifying Active Pharmaceutical Ingredients (API) and their world distribution, and (iii) document the pharmaceutical GVC by examining drugs trade balance between countries. Methods: Trends in DS were analysed using data from various national drug safety agencies, and we measured DS impacts in the media using the Factiva database. Descriptive statistics were performed to look for trends and correlations. Identification of API suppliers around the world was possible through Python web scraping, and choropleth map was performed with Tableau software. Global drugs trade was analysed using World Trade Organization databases. To illustrate import/export between countries, flow maps were produced with Tableau, steam chart with Python and chord diagrams with Perl software. Results: DS has been reported in US and in different EU countries with an important increase since 2016 becoming a worldwide problem. Half of the DS were in critical care, the majority of drugs were parenteral and infectious disease drugs were the most common. Multiple causes for these DS have been reported. We identified a sample of 1273 firms manufacturing 4146 APIs in 57 countries. The distribution confirms the supremacy of India as the drug factory of the world followed by China. But EU countries and US represent also an important part of the API production. The statistics on pharmaceutical export gave a contrasting view of international trade. If the drugs global trade evolves to China's advantage, India's rank decreases, while the import/export balances vary over time and between countries. A detailed analysis of drugs trade in Europe reveals the central position of small countries suggesting the role of the tax system. Discussion: This work is a first attempt to document all together DS, PSC and pharma GVC. The DS study suffers from access to data. The mapping of APIs firms shows a much more heterogeneous geographical diversity than that described by the media, and the complexity of the PSC is revealed by the trade analysis. Given, the importance of public health issues and the weakness of the literature, the economic community should take much more interest in this topic.