COVID-19 Crisis in India Threatens Global Drug Supply

India’s surging COVID-19 cases threaten to derail the global drug supply as the world’s largest producer of generic drugs is unable to secure critical raw materials.

The crisis has serious implications for the U.S., where an estimated one in every three generic pills is manufactured by an Indian supplier and the FDA calculates that 90 percent of all prescriptions are filled with generic drugs.

India, which receives 70 percent of its raw materials from China, was hit on April 26 with a 15-day suspension of inbound cargo flights by China’s state-owned Sichuan Airlines.

The airline is resuming shipments this week, but the temporary suspension underscored the precarious nature of the global supply chain, as India is heavily dependent on shipments of starting materials and active pharmaceutical ingredients and any disruptions have a domino effect across the global supply chain.

“The pandemic has highlighted the risks a single-source supply chain carries,” noted KPMG’s India division in a 2020 analysis.

India also produces 60 percent of the world’s vaccines, most of which are manufactured by the Serum Institute of India (SII). But the Indian government is prioritizing inoculating its own citizens before distributing COVID-19 vaccines abroad, which means that many developing countries contending with increasing COVID-19 cases could face vaccine shortages. ― Jason Scott