Two weeks into 2025, we’ve likely already read how “a new year brings new challenges.” It’s cliche but true. But for pharmacies, that’s not the whole picture. Alongside new issues like updates to the Inflation Reduction Act, pharmacies must also respond to longstanding challenges like drug shortages.
By the first quarter of 2023, drug shortages had reached their highest peak since 2014. This year, even if we don’t see drug shortages beat this record, pharmacies and their patients should still prepare for significant drug shortages. This blog post will explain why and show you how to mitigate their effects.
Drug production and the product supply chain are complex, but gauging potential obstacles is as simple as reading the news. Many drugs are manufactured overseas, so weather events and other natural disasters can disrupt the global supply chain. Political and social events, such as military conflicts or even the threat of regional volatility, can have similar effects. These factors impede the importation of products and raw materials needed to manufacture drugs domestically.
The FDA doesn’t have the same level of oversight regarding offshore manufacturers’ processes, so clearing these items for use in the United States takes longer. Imports lag behind domestic items in reaching the market—assuming the FDA eventually clears them). Regardless of a product’s origin, regulatory challenges like FDA closures (even partial or temporary ones) and additional monitoring procedures lead to further supply chain issues.
In addition to issues with products and regulations, consolidation of the pharmaceutical industry contributes to drug shortages. With fewer manufacturers producing a larger percentage of products, manufacturers increase their volume, which leads to issues with supply meeting demand and higher drug prices.
For example, there are now fewer manufacturers producing the bulk of available generics. This means fewer options during a shortage and less competitive pricing. Drug companies exercise greater control over what they can charge vendors and which products to focus on, so pharmacies often end up (literally) paying for it.
It may sound odd, but it’s still worth noting that there’s more to drug shortages than the real world. Perception often determines our reality. Perception on an industry-wide scale can compound existing issues. “Artificial drivers” are just as detrimental as real-world variables.
The perception of scarcity or even an unfounded but widespread rumor about an upcoming shortage can send manufacturers and competitors scrambling. An observation that one company is stockpiling inventory can snowball into the impression of shortage—especially if your pharmacy doesn’t have the right information—and rock prices and expectations throughout the market.
As discussed above, manufacturers may shift their production portfolio in response to the market to maximize their profits. In the end, it doesn’t matter whether there is an actual shortage; if people are willing to pay more because they believe there is a shortage, expect to pay more. Material or artificial, based on a real product shortage, perceived scarcity or deliberately compressed supply, all of these factors drive record-breaking drug shortages.
How can pharmacies meet the challenges of rising drug shortages? What can they do to maintain high-quality patient care and business solvency? Start by consolidating your purchasing.
Drug shortages and price increases go hand-in-hand, so pharmacies must find more purchasing options and increase their savings on drug purchases. A purchasing management solution enables you to shop an expanded vendor catalog (not just a single primary) through a single interface to drive savings while boosting efficiency.
This approach also enables data-driven decisions. The best purchasing management solutions instantly provide data, such as the potential impact of purchases on compliance, before you even submit a purchase order. They also automatically compare products to find the best option based on variables such as unit price, alternates, packaging, availability, quantities and rebates.
Pharmacies must understand the impact of every purchase on their patients, staff and bottom line. You may not control when a drug shortage hits, but you can find ways to save more while staying compliant and ensuring you have backup options for your patients.
That’s why it’s so important to leverage technology. Drug shortages are unlikely to lessen anytime soon. So give yourself, your patients and your team every advantage. Automating repetitive manual processes frees up time for you and your staff to focus on serving patients (whether it’s face-to-face or finding alternative sources for their medications). It streamlines purchasing in terms of finding the best options without losing hours to the purchasing process. This also eases the burden on overworked staff, which is especially important as pharmacies face the additional challenge of a shrinking workforce.
We’ve covered the factors and solutions for massive drug shortages. But it doesn’t take a record-breaking drug shortage to impact your pharmacy or the patients you serve.
A single out-of-stock item can obstruct your patient’s treatment plans, shake their confidence in your business and send them to another provider. That’s why pharmacies must use every available tool to prepare for shortages this year.