Supply chain challenges could mount for hospitals amid extensive hurricane damage to a key facility (updated-10)

Updates

Click on the dates to see updates at the bottom of this article page as follows:

Dec. 19: An end-of-the-year update

Nov. 27: An increase in allocations for customers

Nov. 12: An update on when allocations will return to 100%

Oct. 30: Insights on the changes to saline administration as a result of the hurricane

Oct. 25: An update from Baxter International on progress made in restoring manufacturing capacity

Oct. 21: Updates from HHS on distribution times and from FDA on drug-compounding permissions

Oct. 17: The latest from Baxter on allocations and the importation of fluids from overseas

Oct. 14: Baxter ramps up international production; an advisory from the CDC on conservation strategies

Oct. 10: The latest on the situation from Baxter International, plus guidance from HHS and provider feedback on the shortages

Oct. 7: Letter from the American Hospital Association to President Joe Biden with urgent recommendations to address the product shortage

Original Story

The supply chain for hospitals and other healthcare providers has taken a hit from the intense destruction wrought by Hurricane Helene.

In causing substantial damage to parts of Florida, Georgia, the Carolinas and Tennessee, the late-September storm disrupted operations at Baxter International’s Marion, N.C. facility, which is the nation’s largest manufacturing site for IV and peritoneal dialysis solutions. About 60% of large-volume IV fluids distributed domestically are produced at the plant.

The company announced Sept. 29 that it had to halt production at the location because of flooding that stemmed from a levee breach, along with a bridge collapse that blocked travel on the road leading to the facility. As of Oct. 3, no timeline was given for resuming operations. Reestablishing the bridge will be a big step for transporting remediation equipment to the site, Baxter said, while also allowing the company to access finished product that had been stored safely and send it along to customers.

In addition, steps are being taken to increase distribution from Baxter’s plants in Mexico and Spain. The Food and Drug Administration (FDA) must give authorization to import products for use in healthcare settings.

“[Following] review and consideration of available inventory and the medical necessity of the impacted products, a specific limit on what a customer can order has been implemented,” an Oct. 3 update from the company stated. “This allocation helps limit stockpiling and increases the likelihood of equitable access to available products.”

All product sizes of saline, dextrose and peritoneal dialysis solutions will be rationed accordingly, the company said.

Hospitals wary of extended snags

Massachusetts General Brigham was one health system saying it anticipated receiving a reduced quantity of IV fluids because of the disturbance at Baxter. The organization implemented steps to ration its supply based on clinical need. Clinical operations were proceeding at full capacity, per local reports out of Boston.

 A supply chain leader at Duke University Health System told ABC News that Baxter paused distribution of affected supplies for 48 hours to gauge what was available in the pipeline. From there, the company intended to establish “pretty strict allocations based on prior usage to make sure that everyone is getting their fair share based on their volume and their needs,” William Trofi, interim vice president of supply chain, said in the report. He said a multiweek delay could be disruptive to clinical operations.

When similar issues have arisen previously, hospitals described implementing conservation steps that included:

• Emphasizing precise dosing to minimize waste
• Incorporating alternative methods of drug administration and hydration
• Prioritizing the use of IV fluids for critical and emergency care

Newly issued guidance from Baxter for healthcare providers recommends implementing those steps and others.

A report from ECRI offers alternatives to the supplies manufactured by Baxter, listing functional equivalents for about 60 products. Whether Baxter customers can expeditiously obtain products from other companies is uncertain since those companies likely will focus on filling orders for current customers. A government directive to the companies may be necessary.

In other news related to the hurricane, CMS made Medicare accelerated payments available to affected hospitals and other healthcare providers in the region beginning Oct. 2, the agency announced.

Port closures no longer an issue

For a short stretch, the supply-chain impact of the hurricane played out at the same time as a port strike that was expected to hamper the delivery of supplies across industries if it lingered. On Thursday, however, the longshoremen’s union agreed to suspend the strike until at least January amid hopes that a deal was within reach.

Port closures spanned the East Coast and Gulf Coast after the union voted to go on strike Oct. 1. Potential consequences in healthcare included medication and supply shortages and, correspondingly, increased costs.

Before the strike was suspended, a statement from HHS downplayed the prospective impact.

“Current preliminary assessments indicate immediate impacts across medicines, medical devices and infant formula for consumers, parents and caregivers should be limited,” HHS wrote.

FDA and the Administration for Strategic Preparedness and Response were working to “quickly identify potential shortages of lifesaving products impacted by a strike to determine the cause and work with manufacturers and distributors to address local, regional and national needs as they arrive,” according to the statement.

Part of the cautious optimism about the restricted immediate impact was based on steps taken by manufacturers in anticipation of the strike. Examples included bringing additional inventory over before the strike began and redirecting shipments to West Coast ports to the extent possible.

Oct. 7 updates

Reflecting the urgency of the situation, the American Hospital Association sent a letter to President Joe Biden requesting action to address the growing shortage of IV solution stemming from the forced closure of Baxter’s plant. The situation has been exacerbated because virtually all suppliers of the solutions have implemented strict ordering allocations and are declining to accept new customers.

“Our members are already reporting substantial shortages of these lifesaving and life-supporting products,” the letter states. “Patients across America are already feeling this impact, which will only deepen in the coming days and weeks unless much more is done to alleviate the situation and minimize the impact on patient care.”

Among the AHA’s various suggested steps is an FDA edict that would allow hospitals and health system to prepare sterile IV solutions at their own pharmacies and distribute the products among their facilities as needed. The association also recommends invoking the Defense Production Act to set requirements and incentives for manufacturers to increase production of sterile IV solutions and containers, along with removing barriers to the importation of those products from Europe.

“Rest assured that hospitals and health systems have immediately implemented their organization-specific action plans to conserve IV fluids and ensure patient access to care and services,” the letter states.

Another massive storm

On top of the challenges from Helene, Florida is bracing for its second potentially huge hit in two weeks with Hurricane Milton projected to make landfall near Tampa late Wednesday.

An Associated Press story examined the efforts being undertaken by hospitals and healthcare providers in advance of the storm, including evacuations. Tampa General Hospital deployed an “aquafence” barrier to protect against Helene and will do so again for Milton.

Oct. 10 updates

Baxter International provided a status update on its recovery Wednesday, saying allocations of its highest-demand IV fluids were being increased from 40% to 60% for direct customers and from 10% to 60% for distributors.

“Due to the vulnerable patient population they serve, allocations for IV solutions and nutrition products for designated children’s hospitals were increased to 100%,” the update says.

Allocations for high-concentration dextrose and sterile water for injections also are being increased. Additional increases for certain product codes could be available in early November, according to the statement, and the company hopes to restart production at the affected facility by year’s end.

For peritoneal dialysis solutions, allocations “remain as communicated, and we are working with our partners to conserve and identify alternate sources of supply across all PD product categories,” the statement reads.

Healthcare stakeholders feared the IV-solution shortage could have become even more dire after Hurricane Milton because a factory operated by B. Braun Medical Inc., the second-largest maker of the product after Baxter, is located in Daytona Beach and was in the path of Wednesday night’s storm.

Although the city took a big hit along with most of Florida, Braun said its factory and distribution center remained intact. As announced previously, the company halted production at the location Wednesday and Thursday as a precautionary measure while ramping up production at its Irvine, Calif., site. Production in Florida was on track to resume Friday.

What the government is doing

HHS issued a letter to providers from Secretary Xavier Becerra, saying the department is implementing a government-wide response to mitigate the supply chain impacts of the storms.

Becerra noted that shortages of some of the key products predate the hurricane and will be further constrained by the recent damage. He said FDA regulations permit drugs to be compounded when they’re in shortage and that the agency will work with Baxter to identify potential products already in the company’s system, along with alternative manufacturing sites, including in other countries.

“As alternatives are identified, FDA is expediting assessments of those options,” Becerra wrote. “FDA will also expedite consideration of any shelf-life extension requests manufacturers submit for short-dated product.”

He also said HHS’s Administration for Strategic Preparedness and Response (ASHP) is coordinating with Baxter to help the company resume operations expeditiously and is monitoring the supply-chain impact of Milton.

HHS urges providers to “implement product conservation strategies to maintain safe, quality patient care and maximize available supply,” Becerra wrote. “HHS is encouraging all providers and health systems, regardless of whether they have experienced a disruption in their supply, to take measures to conserve these critical products.”

The letter includes a link to ASHP management and conservation recommendations for small- and large-volume fluid shortages.

Feeling the pinch

Premier, Inc. released survey results Oct. 10 showing more than 86% of U.S. healthcare providers are experiencing shortages of IV fluids. Of the 257 providers that responded to the survey, 54% said they had no more than 10 days of the fluids in inventory, compared with 15 to 22 days in typical scenarios.

Providers with fewer than 25 beds were most likely to report receiving zero of their ordered fluid quantities.

“Providers reported in qualitative survey comments that it’s only a matter of time until supplies dwindle to zero,” Premier wrote in a summary.

Nearly 17% of respondents have canceled procedures such as elective surgeries, with 58% considering such a step in the near term and 78% saying they will have to consider doing so over the next month if the situation does not change.

A secondary impact of the supply chain disruption is the proliferation of unauthorized offers to buy IV fluids. More than 40% of respondents said they received solicitations from gray-market suppliers touting the availability of fluids but at highly marked-up prices, Premier wrote, “raising additional concerns about price gouging and product authenticity at a time when many are struggling to obtain products necessary for routine operations and patient care.”

Oct. 14 updates

Baxter announced it had activated production of IV fluids and peritoneal dialysis solutions at seven sites worldwide, including in China, Canada, Ireland and the United Kingdom. The FDA authorized the importation of 19 product codes from those sites. There was no immediate update to the 60% allocation limits that were announced Oct. 9 (see the Oct. 10 updates above).

In addition, the CDC issued an advisory Oct. 12 with a summary of recommendations for providers seeking to mitigate the impact of the IV solution shortage on patient care.

Among the various recommendations are suggestions to incorporate multidisciplinary team involvement in developing conservation and stewardship strategies for specific patient populations, and to constantly communicate changes in the situation to hospital leadership, frontline staff and patients.

The advisory also has recommendations for providers and administrators in dialysis facilities and various links that can be bookmarked for easy reference.

Oct. 17 updates

The latest notice from Baxter clarifies that the importation of IV fluids and peritoneal dialysis fluids from global production sites (see the Oct. 14 update above) was factored into the previously announced increase in allocations from 40% to 60% for direct recipients and 10% to 60% for distributors. Thus, no additional increase is immediately in the offing.

“We continue to work closely with FDA to authorize temporary importation for additional Baxter manufacturing sites and products,” the update says.

The first imported shipments are due to arrive in the U.S. this weekend, with providers set to receive the products “over the coming weeks” and additional details to be communicated in upcoming days.

Shipments of peritoneal dialysis solutions continue to be geared primarily toward existing patients. Baxter says it will provide an update on incorporating allocations for new patients in upcoming days.

Oct. 21 updates

HHS provided new information on the shortages, saying hospitals have 50% more product available to them than in the immediate aftermath of Helene.

Overseas flights bringing product to the U.S. from Baxter’s global facilities were scheduled to begin Oct. 19. “Over the coming weeks this will include millions of units of product from at least four different international facilities,” HHS wrote in a fact sheet.

Distribution is set to take place through the usual channels and to be based on currently projected allocations. Baxter and HHS’s Administration for Strategic Preparedness and Response are working to expedite distribution, reducing times from between five and 10 days to less than a day in some cases, according to the fact sheet.

In a note about authorization for hospital pharmacies and outsourcing facilities to compound their own versions of the products that are in shortage, the fact sheet clarifies that since 2021, there no longer is a policy restricting the supply of compounded drugs to a one-mile radius around the compounding facility. Nor is there a recommendation for the drugs to be used within 24 hours.

More information on FDA compounding recommendations and regulatory requirements for the ongoing shortage is available in a policy document issued earlier this month.

In addition, here is the latest update from Baxter International and a look at evidence-based conservation strategies from EBSCO.

The update from Baxter includes the statement, “We recognize that not all customers are yet experiencing the increase in allocation. This may be due to a variety of factors, including the typical 1- to 2-week lag time for product to flow through the full distribution network. We are doing everything we can to help balance the network and get product out as quickly as possible.”

Oct. 25 updates

The latest news from Baxter International includes updates on IV solution manufacturing, noting that production of the company’s “highest throughput” IV products is set to resume at the damaged North Carolina site within the next week. The product could be available for distribution during the second half of November, which Baxter said would be ahead of schedule.

In addition, the company added two global manufacturing sites (factories in Thailand and Singapore) as sources of the products in shortage after receiving FDA authorization to import the products from those locations. A total of nine sites are producing the IV solutions for importation.

The plan remains to get allocations back to at least 90% for some IV solution product codes by the end of the year. The latest developments do not immediately affect allocations, which still are at 60%.

Oct. 30 updates

Recently published data illustrate the impact of the IV solution shortage on hospital clinical operations.

Truveta Research reported that the share of ED patients ages 12 and older who report symptoms of nausea or vomiting and are administered saline dropped from 5.5% before Hurricane Helene to 2% starting 10 days afterward. For patients presenting with dehydration, the share fell from 6% to 2.5%. Declines were regardless of the day of the week.

“We expect these numbers to continue to decrease,” the report states.

“Sufficient hydration is associated with shorter hospital stays and reduced postoperative complications,” the report also states, citing published research. “The impacts of the decrease in saline available could be wide stretching and may only be just beginning to be felt.”

The report notes that possible consequences include a reduction in elective surgery and a more severe impact on patients in rural areas, given that larger health systems likely have an easier time redirecting limited quantities of the fluids as needed.

Baxter International continues to distribute the fluids to hospitals and other customers at a 60% rate of the standard allocation, per the latest update. The company’s hope is that steps being taken to bring the North Carolina plant back to full capacity and to import the products from global manufacturing sites will allow allocations to ramp up in the coming weeks.

In addition, the FDA authorized a 12-month extension of the expiration dates for more than 50 IV and irrigation codes. Products manufactured before the end of September now have a 24-month expiry window from the date of production.

Nov. 12 updates

Baxter International has announced that it plans to restore allocations of several affected IV products to 100% by the end of the year, barring unanticipated developments.

Adjustments to current allocations, which remain at 60% of the usual, will be communicated ahead of the effective date for any adjustments.

Nov. 27 updates

Customers of Baxter International should have received notice of an increase in allocations, according to a Nov. 26 announcement. The increase may not manifest for one to two weeks due to a lag in dispersing the additional product through the distribution network.

Baxter remains on track to restore allocations for some IV solution product codes to 100% by the end of the year and plans to provide details on that increase in mid-December.

Dec. 19 updates

The latest update from Baxter is that eight of 10 product lines have been restarted at its North Carolina facility, and those products should be back to full distribution during the first quarter of 2025. At that time, reductions in allocations for those products are expected to end.

The majority of critical IV product groups are still expected to be back at 100% allocation levels by the end of the month.

Customers also should have been notified of an increase in their allocations of some IV solution products, effective in phases beginning Dec. 16 and Dec. 30.

Allocations for peritoneal dialysis solutions also were increased Dec. 16, with the details communicated to provider partners.