Potential Impact of Coronavirus (COVID-19) on the Pharmaceutical and Biotech Industries

March 13, 2020

The pharmaceutical and biotech industries are assessing how the coronavirus (COVID-19) pandemic may impact business operations. Presently, most countries have confirmed cases of COVID-19 and thousands of people have had confirmed diagnoses. Given the global impact of this virus, the global nature of the pharmaceutical and biotech industry, and the rapidly changing infection landscape, key operational areas will be impacted, and understanding the regulatory and legal implications of these effects and steps to mitigate them are critical.

Supply Chain Considerations

As conveyed by US Food and Drug Administration (FDA) Commissioner Dr. Stephen Hahn, the agency is currently closely monitoring supply chains and expects that COVID-19 will impact the medical product supply chain, including creating potential disruptions to supply or shortages of critical medical products in the United States. Delays in manufacture and import of active pharmaceutical ingredients (APIs) and excipients will be affected, and manufacturing facilities will be stretched by employee absences. Training of employees assuming new responsibilities in view of short staff will be critical, and should be properly documented. Early exchanges with FDA about shortages and possible alternative suppliers may result in creative resolutions under new emergency authorities. Independent laboratory testing associated with manufacturing may be slowed due to demands for testing related to COVID-19.

As of February 27, one manufacturer had already notified FDA of drug shortage due to a site affected by the coronavirus. FDA has also contacted more than 180 drug manufacturers to remind them of their requirements with respect to FDA notification of supply disruptions and to ask them to evaluate their supply chain.

While FDA’s focus appears to be on companies with supply chains in China, as the virus continues to spread, all supply chains will be impacted, and strategies to mitigate shortage risks should be assessed and documented. If alternative suppliers need to be identified and qualified, it should be subject to a prioritization strategy that considers public health and commercial objectives, as FDA is more likely to be willing to be flexible on priority drugs that have public health priorities. Early discussions with FDA about whether changes being effected in 30 days (CBE 30) supplements can accommodate necessary changes are prudent. Monitoring of and updates by holders of critical Drug Master Files should also be considered.

Drug Shortage Notifications

To the extent that drug shortages are unavoidable, product sponsors should ensure that they have functioning processes for shortage notifications and should consider whether the effect of a shortage may be mitigated through expiration date extensions (to the extent appropriate and of value). To the extent possible, companies should also consider whether they have or may be able to quickly develop the necessary stability data to support extensions of current product expiration dates.

Under the Federal Food, Drug, and Cosmetic Act and FDA’s regulations, sponsors of New Drug Applications (NDAs), Abbreviated New Drug Applications (ANDAs), and Biologic License Applications (BLAs) have drug shortage notification responsibilities for products that are “life supporting, life sustaining, or intended for use in the prevention or treatment of a debilitating disease or condition,” including drugs used for emergency medical care or during surgery. Product sponsors must notify FDA of drug product manufacturing interruptions that are likely to lead to a meaningful US supply disruption at least six months prior to the interruption or, if six months’ notice is not possible, as soon as practicable but no later than five business days after the interruption occurs. FDA posts a list of drugs subject to shortages on a publicly available list on its website. Companies with products that are required to report shortages to FDA should ensure that their quality, manufacturing, and regulatory personnel are familiar with the reporting requirements so that information is timely communicated between different parts of the corporate organization.


While FDA is postponing inspections of foreign facilities, as further discussed below, companies importing drug products should expect to see increased scrutiny of products at US ports of entry. In its March 10 announcement, FDA stated that it plans to “employ additional tools to ensure the safety of products imported to the U.S. . . .” These may include “denying entry of unsafe products into the U.S., physical examinations and/or product sampling at our producers, reviewing a firm’s previous compliance history, using information sharing from foreign governments as part of mutual recognition and confidentiality agreements and requesting records ‘in advance of or in lieu of’ on-site drug inspections.” According to the agency, it has already been exercising this authority when it postponed Chinese facility inspections earlier in the outbreak. Accordingly, companies importing drug products should ensure that their entry papers are in order and that they are able to quickly respond to regulator’s requests for additional information.

Potential Application Delays

To the extent a sponsor has an NDA, ANDA, BLA, or application supplement pending with FDA, the agency may be delayed in meeting current user fee goal dates. On March 10, FDA announced that it is postponing most foreign inspections through April and that inspections outside of the United States that are deemed to be “mission-critical” will be considered on a case-by-case basis. Trade press has also reported that the Center for Drug Evaluation and Research (CDER) has cancelled all non-essential travel for the next few weeks and all CDER outside meetings, conferences, and workshops will be postponed through April, including at least one advisory committee meeting. FDA staff have further been encouraged to hold teleconferences rather than in-person meetings with external persons.

If a preapproval inspection of a foreign facility or advisory committee meeting is cancelled or postponed, CDER may be delayed in making application and supplement decisions. Sponsors with pending applications and supplements should begin conversations with their regulatory project managers to further understand possible implications from these delays.

Sponsors should also consider how internal and third-party personnel disruptions may impact applications. For example, industry research and development and regulatory staff shortages could affect timelines on responses to FDA inquires. To the extent that it may take longer for a sponsor to respond to an FDA inquiry, prompt notice to the FDA project manager is prudent.

Clinical Trials

Companies conducting clinical trials should also consider whether the virus may impact clinical trial progress and/or results. For example, if clinical trial sites are in regions or communities experiencing outbreaks, clinical trial enrollment is likely to slow, subjects may be encouraged to avoid hospitals or other sites to minimize exposure, and healthcare personnel may be deployed to COVID-19 related activities. Study monitoring visits, investigator meetings, and the supply of investigational drug product could also be impacted. Companies with ongoing clinical trials should assess the locations of their clinical trial sites to understand how sites may be affected and whether virtual contact may be a substitute for in-person study visits. Protocols may need modification to allow remote monitoring and independent drug delivery. Investigator brochures and informed consent forms may also need revision. Additional procedures to ensure data integrity in view of staff/monitoring shortages or remote visits should be further considered.

Finally, to the extent that clinical trial milestones prompt certain licensing or funding mechanisms, review of relevant corporate documents are critical, and early discussions with business partners are prudent.

Product Promotion

The COVID-19 epidemic will change the receptivity of healthcare providers to noncritical/promotional interactions in healthcare facilities, clinics, and hospitals. Virtual and social media promotion consequently will become more critical for commercial products. Attention to the continued adequate presentation of risk information in remote interactions should be emphasized. Compliance officers should consider retraining on appropriate promotion and documentation of healthcare provider interactions in social media and virtual contexts

Key Takeaways

As with any emergency response, the key to management is identifying and understanding potential risk areas and, to the extent possible, developing and implementing mitigation plans. Because the exact scope and duration of the current outbreak is not yet clear, companies will need to be nimble and proactive in reviewing potential areas of vulnerability and creative in developing contingency plans.


If you have any questions on the issues discussed in this Law Flash, please contact Kathleen Sanzo or Jacqueline Berman.