- Hurricane Maria's effects on drug manufacturing in Puerto Rico continue to be felt, even as many drugmakers say their operations on the island are returning to normal production levels with only modest disruption.
- "For most facilities, we understand that manufacturing is running at minimal levels, and certainly far from full production," testified Food and Drug Administration Commissioner Scott Gottlieb at a hearing before a subcommittee of the House Energy and Commerce Committee.
- According to Gottlieb, many firms are operating below 20% capacity and no firm reached by the agency is operating above 70% of normal operations. That contrasts with that rosier status reports given by major drugmakers so far.
Due to a now long-expired tax incentive, Puerto Rico has dozens of drug and device manufacturing facilities located on the island. Roughly 8% of medicines used by Americans are manufactured there, according to the FDA.
Hurricane Maria largely knocked out the island's power supply, wreaking widespread damage to roads and bridges. Recovery operations have brought some of those functions back on line, but disruptions continue.
Updates from drugmakers that operate plants in Puerto Rico have largely indicated the storm's impact on operations and financial results as limited or already easing.
J&J, for example, has said the effects of Hurricane Maria will have no material impact on its earnings and indicated its facilities "fared well" considering the storm's size. Eli Lilly & Co. reported a similarly smooth recovery, noting it saw no product supply risk or significant financial impact.
Amgen Inc. seems to have been hit a little harder. In its quarterly update, the drugmaker said it would incur $67 million in pre-tax expenses due to the hurricane — a roughly 7 cents hit to earnings per share. Drug substance manufacturing and packaging plants are fully operational, while formulation/filling and small molecule production is expected to come back on line by the end of October.
"Just five weeks after experiencing what was a 100-year storm, we have substantially resumed operations, serving patients in Puerto Rico and around the world," said Amgen CEO Robert Bradway on a Oct. 25 call with analysts.
The FDA's assessment, however, depicts a far more disrupted supply environment in Puerto Rico than what the statements from drugmakers have let on.
"You have probably heard most drug and device firms say that their facilities in Puerto Rico are back in operation. It is true that the manufacturing has been restarted, or was never interrupted at most of the major production facilities," Gottlieb told lawmakers at the Oct. 24 hearing. "But these facts do not reveal the true scope of the challenge that we are facing when it comes to the continuation of medical product production in Puerto Rico."
The major challenge remains power supply. Many drugmakers switched to generators to keep plants running at some level of capacity. But those generators aren't designed to last for prolonged use, Gottlieb said, and rebuilding the power grid on the island will be a months-long endeavor.
If generators fail, it's not so simple as reconnecting a new supply of power and restarting production. Interruption of power can shut down HVAC and other refrigeration of batches in storage, and facilities might need to be reinspected after losing power.
So far, the FDA has had to import alternative supplies of IV solution and metronidazole to address drug shortages resulting from disruption of Baxter International Inc.'s facility in Puerto Rico.