Supply chain

In the last few years, there has been significant progress in the collaboration between the EU and third countries in the sharing of information on the manufacture and distribution of pharmaceuticals and a number of Mutual Recognition Agreements (MRA) are being reached e.g. MRA between the EU and USA in 2017. A consequence of this is a reduction in the burden on pharmaceutical manufacturers e.g. removal of the requirement for additional testing following importation. National Competent Authorities (NCA) also benefit from a better exchange of information on GMP compliance and a reduced need for inspections of sites in third countries.

However, increased globalisation has led to greater complexity and challenges in ensuring the integrity of the supply chain at each stage of the manufacturing process. The NCA are also introducing more regulations and increasing enforcement, which further adds to the supply chain complexity and compliance burden for manufacturers.

With the implementation of the Falsified Medicines Directive (FMD) 2011/62/EU and the Commission’s Delegated Regulation (EU) 2016/161, an authentication system has been established in the EU aiming to protect patients from falsified pharmaceuticals. No pharmaceuticals affected by the Falsified Medicines Directive shall be placed on the market without bearing the safety features. In principle, this requirement applies to medicinal products subject to medical prescription. In order to participate in the system, pharmaceutical companies need to complete an on-boarding process with the respective medicines verification organisations at both the European and national levels.

Compliance failures by manufacturers can have severe consequences, including supply chain disruptions, delays and market recalls. Understandably, there is a growing need to improve supply chain efficiency.

Ensuring the continuous availability of medicines is essential. Several factors add to the complexity of successfully managing supply and avoiding shortages. There are various reasons for supply shortages or disruptions, such as quality defects, increased demand, market shifts in the country or in other markets, delays in production due to missing materials or limited production capacity, delays in shipment due to transport restrictions. Given these challenges, initiatives have been launched by the EU and the Member States in order to reduce the risk of shortages and to increase transparency and exchange of information among stakeholders. Companies are encouraged to review their supply chains for robustness and to establish structures allowing for fluctuations to be addressed in a proactive manner.