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Supply Chain

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Caroline Catherman

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, medical supply shortages got so severe that nurses fashioned masks and gowns out of pool noodles and 

Many factors have been blamed: inadequate stockpiles, slow government action, equipment hoarding. But one that has been especially relevant—and is relevant again today as 

 tensions heat up—is US reliance on foreign personal protective equipment (PPE), supply chain experts told us.

The government invested more than $1 billion to bulk up domestic PPE manufacturing during that first pandemic year, but five years later, the companies that emerged from those efforts have mostly 

 on foreign manufacturers for PPE and other medical necessities. The American Hospital Association calculated in April the US imported over $75 billion in medical devices and supplies in 2024 alone.

 could send the country right back to March 2020.

“If we don’t change the trajectory we are in right now, we’re guaranteed to repeat the same thing,” Tinglong Dai, Bernard T. Ferrari professor of business at Johns Hopkins University, told Healthcare Brew.

Prior to Covid, PPE wasn’t a concern for Premier, a large healthcare group purchasing organization (GPO) that works with more than 4,350 hospitals and health systems. But hospitals needed 17x their usual supply of N-95 masks after they began admitting Covid patients, according to Premier’s April 2020 survey of nearly 1,600 hospitals.

“PPE was always a low variability, very transactional category for our hospital supply chain until Covid hit,” Kyle MacKinnon, senior director of operational excellence at Premier’s supply chain strategic operations, told Healthcare Brew.

 and price gouged PPE early in the pandemic. Supply and demand surged unpredictably and quickly as pockets of the world were exposed to the virus, MacKinnon said.

Another issue is GPOs like Premier didn’t—and still don’t—have data down to the stock-keeping unit on which locations and manufacturing plants products come from, Mark Hendrickson, Premier’s director of supply chain policy, told us.

He said Premier now asks suppliers for “very specific, very detailed data” on their product volume, reliability, and manufacturing locations. The company is lobbying for the US government to track this data better as well.

“We need more transparency on where products are coming from. We need more reporting from manufacturers to the FDA so they can understand where they can pull levers in an emergency,” he said.

Amid 2020’s uncertainty, the federal government invested more than $1 billion in subsidies to increase domestic PPE production. As a result, dozens of domestic startups emerged to manufacture masks, medical gowns, and gloves.

GPOs and hospitals relied on those startups amid increased demand, MacKinnon said. But today, he said, they have largely returned to pre-pandemic purchasing patterns.

“As an industry, we shifted back from that ‘just-in-case’ scenario planning and supply planning to ‘just-in-time’ where now you have to be cost-conscious and get back to a leaner, more profitable organization,” MacKinnon said.

 of US import data by the American Medical Manufacturers Association (AMMA)—a trade association that lobbies against US reliance on Chinese-made PPE—estimates the US uses about 110 billion to 120 billion nitrile gloves each year.

The fact is, China can offer cheaper PPE and a larger portfolio of product models compared to those US pandemic-era startups, Dai said. The US startups couldn’t compete.

“A lot of the companies that were standing up during Covid, as you go back to the beginning, disappeared because they were just undercut overnight,” AMMA Executive Director Eric Axel told us.

MacKinnon said Premier learned from the pandemic and is set up to be “more resilient” during the next one. The industry now has a “thorough playbook” with better data and technology to 

But this return to foreign reliance, Dai warned, may weaken the supply chain when the next emergency comes, whatever it is.

“We have basically moved back to the same—if not worse—dependence on foreign manufacturers for most of the PPE needs here in the US,” Dai said.

US manufacturers could lower costs and compete more effectively with foreign PPE manufacturers if they invested in newer, large-scale production technologies, according to Dai.

The problem? They need large orders with up-front payments to afford those upgrades.

Dai thinks the government could help here by filling its national PPE stockpile with 100% Made in USA PPE to bring “stable demand” to domestic manufacturing, along with other steps, like tax incentives. AMMA has lobbied for those changes, too.

Increasing any manufacturing—not just PPE manufacturing—would be helpful, Dai added, because other manufacturing operations can be converted into PPE assembly lines in emergencies.

July’s One Big Beautiful Bill Act includes provisions that help domestic medical manufacturers, like bringing back R&D tax credits, Axel said.

He added tariffs are another tool to “even the playing field” for domestic manufacturers.

Companies like Abbott Laboratories, Merck, and Roche 

 since early this year to invest more in US manufacturing, though they did not directly attribute their decisions to tariffs. On the flip side, some experts 

 Healthcare Brew tariffs could strain the supply chain.

But Axel argues the medical supply chain is already strained because it relies on foreign manufacturers, some of which have been flagged for creating allegedly unsafe supplies. (The 

 has identified safety issues in several brands of syringes from China, for instance.)

Axel also believes the US has seen—and will see again far before a global pandemic occurs—repercussions from its lack of diverse domestic manufacturers. He pointed to disruptions from 

“Covid is already a lesson from a different era,” he said.

A worker oversees the production of KN95 masks in Handan, North China's Hebei Province in 2022.

Despite Covid-19 pandemic efforts, the US still mostly imports PPE

While we love a throwback, the Covid-19 pandemic’s first year isn’t something we want to revisit.

Despite pandemic efforts, the US still mostly imports PPE

” for imported drugs, pharma giants like 

 are investing billions into expanding US manufacturing.

On the surface, it seems like tariffs are accomplishing the 

 of bringing manufacturing back to the US. In an April 2 briefing, the White House vowed this increase would strengthen supply chains, lower costs, and reduce dependence on “foreign adversaries.”

But Baltimore, Maryland-based Johns Hopkins researchers said in a June 11 media briefing they don’t think tariffs will bring much benefit. For generic drugs, tariffs could increase 

. For branded drugs—which make up 20% of prescriptions but 

 of prescription drug spending—tariffs could 

Only about 12% of active pharmaceutical ingredient (API) volume is made in the US, excluding IV fluids, according to an April report by the United States Pharmacopeia (USP), an independent nonprofit that sets global drug quality and safety standards.

“It would take years” to build up enough US manufacturing capacity to end reliance on other countries for certain branded drugs, Jeromie Ballreich, an associate research professor in the Department of Health Policy and Management at the Johns Hopkins Bloomberg School of Public Health, said during the briefing.

Plus, because domestic manufacturers import active pharmaceutical ingredients and key starting materials to make their drugs, manufacturing drugs here doesn’t necessarily dodge potential tariffs, Mariana Socal, an associate professor in the same department, said.

“We would expect pharma to pass the cost on to the insurers, and we would expect insurers to pass the cost on to the individual patients,” Ballreich said.

Already, the US pays more for branded drugs—sometimes 2x–4x more—than other countries, according to 2021 data from the Government Accountability Office.

The US pays about the same or less than other countries for these drugs, Socal said.

“For these products, the biggest problem is not cost, but it’s actually supply shortages,” she said.

If it becomes more expensive to import generics, she added, manufacturers might be tempted to “cut corners” on safety, since these drugs already have such low profit margins.

The FDA, which regularly inspects manufacturing facilities, could end up pausing imports from certain plants in response, exacerbating shortages. About 62% of drug shortages from 2013–2017 were related to quality issues, the agency said in a 2019 

On the other hand, the researchers said there are legitimate concerns about relying on other countries for drugs and a need for supply chain reform.

“Having access to prescription drugs is a national security matter,” Socal said. “I think that’s part of the rationale for bringing manufacturing back to US soil.” 

But to do so requires more than tariffs: It demands a well-trained workforce alongside policies that make it attractive to set up shop in the country, Ballreich said.

Branded drug manufacturers have moved from the US to places like Switzerland, 

, and Germany over the last couple decades because those countries offer better tax policies, he said. (The European Union manufactures 43% of API for US brand-name prescriptions, USP found.)

To bring the manufacturers back, the US needs to offer tax policies that can compete.

He pointed to the 2022 CHIPS and Science Act, which used tax credits and grants to tempt more companies to move semiconductor manufacturing back to the country.

The act subsidized the construction of factories in Arizona, New York, and Ohio, though President Trump has called for the end of the program, arguing tariffs will get the job done, 

Scale with money and surgical mask, tipping over with weight of money.

Johns Hopkins researchers warn drug tariffs could worsen shortages

Tariffs don’t apply to prescription drugs yet, but that may come soon.

Cassie McGrath

Hospitals have been rocked by supply chain challenges in recent years, from 

 for personal protective equipment (PPE) during the Covid-19 pandemic to 

—hospitals are gearing up for additional disruptions.

Products can be costly, as market intelligence company 

 earlier this year. In 2023, hospitals spent $57 billion on medical and surgical supplies—up 6.5% from 2017’s $30.2 billion, according to the report.

Hospitals and health systems must have enough of the right medicines, medical devices, and supplies at the right time to provide “safe and effective care,” Akin Demehin, VP of quality and safety policy at the American Hospital Association (AHA), told Healthcare Brew.

“It’s why they care so much about what the supply chain looks like, and put so much effort into trying to understand and manage the supply chain,” he added.

To avoid further disruptions and cost increases, experts told us providers should learn from the last few years and look at 

In terms of possible shortages, Demehin said hospitals are keeping a close eye on everything from medications to devices (including scope covers, blood pressure cuffs, and pulse oximeters) to PPE like disposable masks and plastic gloves.

“[These items] really do make up the day-to-day patient care activity that we know that patients and communities are depending on,” he said.

 asking the Trump administration for tariff exemptions on medical devices and pharmaceuticals to “try to minimize those disruptions to supplies and minimize the disruptions to patient care,” Demehin said.

The White House did not respond to Healthcare Brew’s request for comment.

But preparation to prevent shortages is a “moving target,” Demehin said, as hospitals continuously work to figure out what may fall into a shortage and what they have stockpiled.

He said hospitals rely on both domestic and international materials, so providers are “undertaking a careful evaluation and collaboration” with group purchasing organizations and distributors to determine which products may be impacted.

 sold in the US are made abroad, according to 2024 reporting by consulting company GlobalData. 

 in April that, in 2024, the US imported $75 billion in medical devices and supplies.

Still, if any of these items face shortages due to tariffs, providers already have experience in producing their own medications on-site and finding alternative suppliers when needed, Demehin said.

In 2023, for example, Tufts Medical Center in Boston 

, cardioplegia, that it needed for heart surgeries when the drug was in shortage.

 Beyond that, Dee Donatelli, senior director of spend management at healthcare operations company Symplr, said it’s important for providers to “look at the total care management within a hospital, not just the price of a product.”

In other words, if there’s a severe shortage of masks, clinicians may be able to wear them for longer periods rather than throwing them away after one use. A 

 by Cincinnati Children’s Hospital Medical Center suggested during the pandemic that safely reusing certain PPE could help mitigate shortage challenges.

Providers could also be more thoughtful about ensuring the care they provide is absolutely necessary, Donatelli added. For example, clinicians could evaluate if every blood test they would normally administer is required for each patient, potentially saving money and cutting down on products used.

“Utilization management, waste management, all of that—that’s where we can tighten our belts to help reduce the overall cost of care,” she said. “It is much less about the price of a product and much more about how we use the products that are driving up our costs and reducing our margins.”

How the supply chain has been affected by tariff rumors

How hospitals might respond to tariffs, supply chain challenges

One expert says it's more about how providers use products, not just how many they have.

The pharmaceutical industry seemingly came out on top when President Donald Trump announced import tariffs on April 2. And while those are currently on a 

 for every country except China, giving a break to industries like auto and steel, it seems the shoe might be on the other foot for pharma now.

Under the original plan, those industries faced at least 10% tariffs for goods imported to the US, kicking off a 

. But pharma had been excluded, and major players’ stocks responded positively.

Companies like Johnson & Johnson and Eli Lilly saw small bumps (1.4% and 1.6%, respectively from April 1 to 2) as the rest of the market suffered. Pharma was exempted because the industry’s supply chain is spread out and complicated, and also because the medication it makes can be lifesaving.

“I was encouraged that they were exempted from tariffs, just given the essential nature of pharmaceuticals and also the complexity of the pharmaceutical supply chain,” Evan Seigerman, biopharma analyst at investment bank BMO Capital Markets, told Healthcare Brew. “You can’t just easily move manufacturing from one jurisdiction to another.”

But when announcing the pause on April 9, Trump also said the grace period for pharma could end “very shortly,” which caused the pharma market 

. By around noon on April 10, J&J’s stock was down 13% and Lilly’s dropped 5%. 

Seigerman and his colleagues wrote in an April 9 report they’re “strongly opposed” to tariffs for pharmaceuticals because the strategy is unlikely to bring manufacturing back to the US. “Shock [to] the pharma supply chain threatens our own public health and access to medicines—from generic antibiotics to complex biologic and peptides,” they wrote. “The ongoing gutting of [the] FDA is bad enough, only now to be compounded by what we believe to be real talk of pharma tariffs.”

When Trump announced the tariff pause, he said “[pharmaceutical companies] will leave other places because they have to sell—most of their product is sold here and they’re going to be opening up their plants all over the place.”

, the number of manufacturing facilities in China making active pharmaceutical ingredients doubled from 2010 to 2019.

Roche, a pharmaceutical company with more than 25,000 US employees, has an “entire pharma and diagnostics value chain” in the country already, with four R&D, production, and distribution sites in the pharmaceutical division as well as seven R&D and manufacturing sites for diagnostics, according to Nina Maehlitz, the company’s global media spokesperson.

Still, Maehlitz said it’s “considering additional US investments to continue to meet patients’ needs.”

Eric Axel, executive director at American Medical Manufacturers Association, which represents companies that make medical supplies in the US like masks and gloves, agreed that more products should be made domestically.

 from the FDA’s Center for Drug Evaluation and Research Side Catalog found that 46% of manufacturing facilities that make medications and 26% that make active pharmaceutical ingredients for drugs taken in the US are made domestically.

“If we rely too much on foreign suppliers, we leave ourselves at the mercy of these foreign countries, which a lot of times do not have our best interests at hand,” he said, adding that there are many domestic manufacturers who want business from companies “complaining” that their supply chain has been disrupted.

Plus, Seigerman said, costs are likely to rise if other tariffs go back into effect, as the prices of non-drug goods used in research and development—like microscopes, glass bottles, electronic equipment, and raw materials—may go up.

Eli Lilly declined to comment, but CEO David Ricks 

 if the company does face rising costs, it may have to make cuts, likely in staff and in R&D research and development spending.

But other experts said there are benefits to making drugs in other countries, namely the environmental impacts. Among these issues is the rise in animal poisonings, contaminated algae, and drug-resistant bacteria, according to the 

“A lot of the processes to make the API, or active pharmaceutical ingredients, are not really environmentally friendly processes,” Seigerman said.

 pharmaceuticals could see tariffs upward of 25% or more that would increase over the year, but he wanted to “give them time to come” back to the US.

 have already committed billions of dollars ($50 billion and $55 billion, respectively) to reshoring. J&J plans to open three facilities, including one that is already under construction in North Carolina. Lilly is planning four manufacturing sites in North Carolina and Wisconsin as well as expansions in Indiana.

Pankit Bhalodia, a partner in life sciences at consulting firm West Monroe, said it’s hard for many companies to make decisions amid the uncertainty.

On April 3, West Monroe released the results of 

 across all industries that showed tariffs, geopolitical tensions, and cost of materials were among supply chain executives’ top concerns in Q1.

“Whether it’s large or small pharmaceutical companies, the supply chain is very complex, very distributed, very tangled with a lot of countries,” Bhalodia said. “It’s not truly exempt as it was perceived.”

A shipping container inside a medication bottle and pills with overlayed dollar signs spread out. Credit: Anna Kim

Pharma tariffs are coming ‘very shortly.’ Experts weigh in on what that could look like

Companies are likely to see cost increases despite an initial exemption.

Pharma tariffs are coming ‘very shortly.’ Here’s how they could impact healthcare

, the healthcare industry is no stranger to supply chain issues.

Microsoft and Medline Industries, an Illinois-based medical manufacturing and supply company, are teaming up to fight the problem. Together, they are developing an artificial intelligence (AI) “ healthcare supply chain resiliency solution” called Mpower.

“The potential for AI to help alleviate the burden on healthcare professionals is immense, and together with Medline we’re helping to address a unique piece of this puzzle—the healthcare supply chain,” Deb Cupp, president of Microsoft Americas, said in a release last week.

Mpower is designed to pull customer and supplier data that will help the tech predict supply chain operations and give suggestions to supply chain professionals, making “complicated inventory management workflows easier,” according to the release.

The program runs on the cloud-based Microsoft 365 using Copilot in Azure AI, the tech giant’s service with natural language processing, or NPL, text analysis capabilities. The companies said using this existing secure platform will make it easier to implement, as many workers are likely already familiar with the tools.

“By combining capabilities of our Copilot and AI offerings with Medline’s proven expertise across supply chain resilience and clinical solutions, we will be able to significantly reduce complexity and give providers time back to focus on patient care,” Cupp added in the release.

3D isometric automated warehouse robots and Smart warehouse technology Concept

Medline, Microsoft to build AI tool to prevent supply chain disruptions 

The Mpower will use AI to make recommendations on supply chain management. 

Florida has taken a beating in recent months, hit first on September 26 by Hurricane Helene

and then just two weeks later by Hurricane Milton on October 9.

Florida hospitals were prepared, though, and are mostly back to normal, Florida Hospital Association president and CEO Mary Mayhew told Healthcare Brew.

“The lack of impact and damage is a testament to the critical investments, to the hardening of facilities, to the flood mitigation efforts,” she said. “Even if [hospitals] evacuated, the fact that they were able to reopen quickly because they didn’t sustain any damage is attributable to the physical plant investments they’ve been making.”

But there were still obstacles hospitals couldn’t anticipate that taught leaders important lessons for the future, she added, especially as climate change will make extreme weather events 

An “unprecedented number” of healthcare facilities evacuated for Milton, Mayhew said—last Friday, the number was more than 400, according to Agency for Health Care Administration (AHCA) data shared in a press release from Gov. Ron DeSantis’s office.

So while hospitals are now largely back to normal operations, it can be difficult even a week later to find a place to discharge patients who need to go to nursing homes or assisted living facilities, Mayhew explained.

By October 15, about 124 healthcare facilities were still evacuated, including four hospitals, two hospital emergency departments (EDs), 68 assisted living facilities, and 15 nursing homes, per AHCA data in a separate release from the governor’s office.

AHCA reported in the same release that 153 facilities did not have power back yet, including three hospitals, two hospital EDs, 104 assisted living facilities, and 14 nursing homes.

Hospitals are also still in the process of returning patients who were transferred away from the coast, Mayhew added.

Even after facilities opened up, employee obstacles have slowed down efforts to return to normal.

“One of the biggest challenges we faced after Milton was the lack of available fuel for employees to fill their cars to be able to get to and from the hospital,” Mayhew said.

Florida residents evacuating the coast pre-Milton 

local gas supplies. Then Port Tampa Bay’s fuel terminals lost power following the storm, which kept workers from delivering more fuel to local gas stations until the terminals were restored last Friday, according to a press release.

 A water main break during Milton also caused St. Petersberg officials to temporarily shut off the public water systems and sewers, leaving several hospitals in the area without access to public utilities, Mayhew said.

She added that hospitals are generally prepared for power outages with generators, but sewers are a whole other ballgame.

“We need to continue to prepare and strengthen what hospitals are doing in the event that that happens another time,” she said.

She said that some facilities, such as Sarasota Memorial Hospital, have installed wells for cases where public water becomes inaccessible. Others, like Tampa Bay General Hospital, combat flooding by turning to new technology such as the 

An AquaFence flood wall in Tampa ahead of Hurricane Milton

Florida hospitals’ lessons learned from Hurricane Helene and Hurricane Milton

Florida is gradually rebounding from evacuations, flooding, and power outages from back-to-back hurricanes.  

Florida hospitals weathered Hurricanes Helene and Milton thanks to ‘critical investments’ in prevention

The US is struggling to address a yearslong IV supply shortage following two back-to-back hurricanes.

A major IV manufacturing site and distribution center in Daytona Beach, Florida, operated by B. Braun Medical is “intact” following Hurricane Milton, director of corporate communications Allison Longenhagen told Healthcare Brew on Thursday. The New York Times 

 that B. Braun manufactures about a quarter of the nation’s total IV fluids.

“Our Daytona Beach IV solutions manufacturing site and distribution center were not seriously impacted by Hurricane Milton and will resume operations as planned on Friday morning,” Longenhagen said.

The center closed on Wednesday morning and is set to reopen Friday at 8am, according to a statement on B. Braun’s website.

Ahead of the hurricane’s landfall on Wednesday night, the federal Administration for Strategic Preparedness and Response (ASPR) helped the company move more than 60 truckloads of IV solutions to a secure facility north of Florida, Longenhagen said.

She added that the company is still in “daily contact” with ASPR, the drug shortage staff at the Center for Drug Evaluation and Research, and the Department of Health and Human Services (HHS) “to address this issue and help alleviate any impact on patient care.”

 Milton was headed toward B. Braun just two weeks after Hurricane Helene had flooded another IV solution manufacturing site in North Carolina. The site, operated by Baxter International, produces about 60% of the country’s IV solutions, according to the American Hospital Association.

Though Baxter International announced on its website Wednesday that it has increased the volume of IV solutions it will be providing to hospitals and distributors, it’s still not as much as they’d normally get.

The company said Wednesday it’s limiting orders for “highest demand” fluids at 60% of customers’ and distributors’ typical needs. This includes saline, dextrose, and peritoneal dialysis solutions, according to the Florida Hospital Association.

As of Thursday, group purchasing organization Premier 

 its members and found that 86% are experiencing a shortage of IV fluids.

Before Helene, there was already a shortage of normal saline IV fluids, normal saline irrigation fluid, sterile water irrigation, and dextrose 5% IV fluids, HHS Secretary Xavier Becerra said in an October 9 

“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,” Becerra wrote.