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It’s no secret that more than 80 percent of the active pharmaceutical ingredients (API) used to manufacture today’s most vital medications are produced abroad. The majority of these key ingredients are sourced from China and India. Pharmaceutical companies of all sizes, and at all stages of product development from discovery through end of product life cycle, have long believed that offshoring the production of critical medicines in the United States is the most cost-effective option.

But what is the true cost of relinquishing control of the supply of our Nation’s essential medicines and their API to foreign sources? And are there really any verifiable cost savings that outweigh the growing range of risks?

To find that answer we must first understand how we got here. For more than 50 years, pharmaceutical companies have been forced to contend with a labor-intensive, multi-step, lengthy process for bringing a medication to life. Historically, sizeable facilities and large-scale equipment have been required in the manufacturing process. And the consumables used in production, including harmful solvents, have often been procured and stored in sufficient quantities to allow for the desired maximum volume of product to be manufactured. Storing such large quantities of harmful solvents were deemed to have negative health and environmental implications.  As a result, the United States has witnessed a steady drumbeat of companies offshoring their critical manufacturing capabilities to countries with fewer environmental protection regulations and where labor, energy, and transportation costs are low.

That was then. Today, things have changed.

The approach of relying on foreign sources may no longer be the most cost-effective – or safe – way to manage the lifecycle of pharmaceutical products and their ingredients. And even if the negligible cost savings are realized, today’s reality of supply chain disruptions from public health threats, trade disputes, geopolitical challenges, and regulatory inspection and approval delays make the reliability of the global landscape suspect at best. A single misstep in the production process can derail products and cost hundreds of millions in lost revenues. And even worse, it leaves our national health security extremely vulnerable.

Many pharmaceutical companies are now questioning the true cost of foreign API and the logic behind years of investing significant time and money traveling to foreign countries, such as, China and India, delays by FDA inspection of foreign facilities, risking IP overseas, and ongoing investments to maintain a large foreign footprint. Today, the United States has the infrastructure, talent, and manufacturing capabilities to put the misperception of cost savings achieved by offshoring APIs to rest. By leveraging state-of-the-art flow chemistry, continuous manufacturing technology, and other advanced manufacturing processes, it is now possible to re-imagine the domestic production of key starting materials, active pharmaceutical ingredients, and finished pharmaceutical products that are critical to U.S. healthcare. Through the use of continuous-flow technology and green chemistry, as an example, U.S. based companies can reduce costs and waste, improve quality and yield, and offer a more environmentally friendly manufacturing option.

Re-imagining the essential medicines supply chain from the ingredients to finished products in the United States doesn’t happen overnight and there is clearly progress still to be made. Leading contract development and manufacturing organizations (CDMOs), like U.S. based Phlow Corp., now offer a range of customized services for small molecule APIs and registered starting materials to help pharmaceutical and biotech companies of all sizes reduce their manufacturing costs and manage the entire product lifecycle. By collaborating with project teams from a variety of pharmaceutical and biotech companies, Phlow provides expert consultation and differentiated R&D services, through their SMART-CDMO, as part of its mission to help move domestic products to market and scale faster and more affordably.

In 2020, the Biomedical Advanced Research and Development Authority (BARDA) awarded Phlow federal government funding for advanced manufacturing of America’s most essential medicines at risk of shortage. This funding included medicines for the COVID-19 pandemic response and key medical countermeasures previously only manufactured abroad. Phlow partnered with Virginia Commonwealth University’s Medicines for All Institute, Civica Rx, and AMPAC Fine Chemicals to deliver over two million doses of essential generic medicines used to treat COVID-19 patients to the U.S. Strategic National Stockpile. Today, Phlow leverages this extensive network and its strategic partnerships, such as United States Pharmacopeia, which is building a new laboratory co-located with the R&D Laboratory at Phlow, to help other pharmaceutical and biotech companies reduce costs, decrease development time, and lower their environmental impact by serving as an extension of each customer’s R&D team from beginning to end.

As Phlow grows its SMART-CDMO offering, pharmaceutical and biotech companies are leveraging Phlow’s customized services for small molecule APIs and registered starting materials at all stages of development in an effort to re-shore the manufacturing of essential and innovative medicines for good. Regardless of the size of company or the type of process, from batch to advanced manufacturing technologies, Phlow is providing an alternative to foreign APIs and the hidden costs and risks involved. The question is, will pharmaceutical and biotech companies finally break free from their dependency on foreign suppliers and choose to condense what once took months of expensive work overseas to a few days in the U.S.? And will we as a nation finally commit to a domestic solution that revitalizes the way America strengthens its supply chain for lifesaving, priority medicines? For more information, please visit