Pfizer manufacturing ills mean ongoing shortages for hospitals

Pfizer sign
Shortages of Pfizer injectable painkillers has taken a tole on its finances. (Pfizer)

Pfizer acknowledged Tuesday that it continues to struggle with manufacturing at some Hospira plants, an issue that bodes ill not just for investors but also for U.S. hospitals. The manufacturing problems at Hospira that dented earnings and led it to lower its forecast mean ongoing drug shortages for healthcare providers.

CEO Ian Read today said (PDF) that “ongoing legacy Hospira sterile injectable supply shortages” dampened Pfizer’s results for which it reported 2% growth operationally. And the shortages are not over. They also play into the narrower financial guidance the drug giant reported for the year, which was shaved to a range of $53 billion to $53.7 billion from a range of $53 billion to $55 billion.

Manufacturing problems at Pfizer’s plant in McPherson, Kansas, are at the heart of some of the most troubling shortages for the the FDA and the healthcare system. Its Hospira unit is the largest producer of injectable opioid analgesics used in hospitals.

The FDA pointed out in a report that shortages of these particular drugs were caused by production delays tied to changes and upgrades made at a Pfizer facility in Kansas after the agency slapped it with a warning letter. It was then “exacerbated by recent issues related to manufacturing quality at the same facility.” The FDA has been working with Pfizer and other drugmakers to deal with the shortages.

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For its part, a Pfizer spokesman said today it will be the end of next year before its supply issues are "significantly improved." Pfizer is making needed improvements to its sterile injectables manufacturing but that means "manufacturing output is reduced, creating a shortage of some important products," Steven Danehy explained in an emailed statement.

"We remain committed to the SI business and its future growth as evidenced by the $800M we will have
invested in our injectables network by the end of this year and our announcement of an additional investment of up to $1.4B over the next several years."

Supplies are so tight that Pfizer has even stopped selling injectable opioids to veterinarians to divert those drugs to fill orders from hospitals. The drugmaker said it won’t resume sales for animal use until the shortage at hospitals and surgical facilities has been resolved, which is not expected before the second quarter of 2019.

Sales at Pfizer's Essential Health business, which sells its sterile injectables, were off 4.4% to $4.83 billion. It will be folded into a new unit next year that will sell generics and off-patent drugs. Incoming CEO Albert Bourla also has put CFO Frank D’Amelio in charge of manufacturing operations in an effort to resolve issues and reduce costs.