As Brexit costs mount, Pfizer estimates $100M to adapt its supply chain
In yet another indication of what the burden of Brexit will be for drug manufacturers, Pfizer has said that it has tallied its costs to revise its manufacturing and supply chain at about $100 million.
In a quarterly filing, the New York-based Big Pharma player said that its “preparations are well advanced to make the changes necessary to meet EU legal requirements after the U.K. is no longer a member state, especially in the regulatory, manufacturing and supply chain areas,” so that it can ensure a continuity of supply in the U.K. and Europe.
“The one-time costs of making these adaptations are currently estimated at approximately $100 million,” Pfizer said.
According to Bloomberg, which first reported the Pfizer figure, GlaxoSmithKline has also estimated its Brexit costs at about $100 million. Smaller company AstraZeneca has pegged its costs at about $40 million.
With a deal between the U.K. and the EU on how to have an orderly separation nowhere in sight, drugmakers have been mapping out their own plans on how to avoid backups and shortages in supplying drugs from one market to the other after the divorce in March of next year.
Anticipating delays at border crossings, French drugmaker Sanofi is considering flying vaccines, which have a short shelf life, to a predetermined spot in the U.K. where the government would release the delivery instantly. Another option, if the two sides could agree, would be to mark trucks so that they can pass customs without the usual checks.
Sanofi has already said it was increasing its inventory of drugs for the U.K. from the usual 10 weeks to 14. AstraZeneca has also said it is stockpiling drugs supplied by the U.K. and EU for each other. Merck & Co. is making its own plans, including reserving as much as six months’ worth of product in the face of a possible “temporary supply blackout” next March.
But the U.K.’s National Health Service wants to ensure that all drugmakers are prepared for the worst. Last week, it ordered drugmakers to report by Sept. 10 how they will stockpile in the U.K. those medications currently made in Europe but sold to the National Health Service. It wants at least six weeks' worth of supplies above their regular buffers.
“While we recognise that many companies will already have made their own arrangements we are keen to receive a response from all companies to ensure we have a comprehensive picture. … We are asking suppliers to confirm their plans on a product-by-product basis,” the report says.
Sep 4, 2018
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