Puerto Rico lured pharmaceutical and medical device companies to its shores with its attractive tax regime. Now, its climate vulnerability threatens the world's medical supplies.
The Food and Drug Administration is monitoring about 30 critical pharmaceuticals manufactured either solely or primarily on Puerto Rico — including 14 that cannot be substituted by anything else on the market, FDA Commissioner Scott Gottlieb told a congressional panel yesterday. The outlook is also risky for manufacturers of 50 critical medical devices, like insulin pumps and pacemakers.
Nearly a month after Hurricane Maria wiped out Puerto Rico's rickety electrical grid, emergency responders are still struggling to treat the immediate health needs of people on the island. Dialysis treatments are cut short, routine lab tests have to be outsourced to the mainland and lawmakers cited a picture of surgeons operating by cellphone light.
The damage to sophisticated medical manufacturing firms, though, could prove just as devastating to Puerto Ricans and the world at large. The sector comprises at least one-third of the territory's gross domestic product. The firms are major employers. Most facilities are barely operating, and it's causing or exacerbating shortages in the United States and elsewhere.
About 8 percent of the medicines Americans take comes from Puerto Rico, based on dollar value, Gottlieb said.
Corporations in sectors like agriculture, mining and energy are already preparing for climate change to shock supply chains, according to a 2013 report from PwC.
The pharmaceutical sector is particularly vulnerable to those disruptions, given then small number of suppliers for each product. Extreme weather fueled by climate change promises to compound that vulnerability, researchers from the Potsdam Institute for Climate Impact Research wrote in a 2014 commentary for the journal Nature.
In the wake of Maria, FDA has already scrambled to source alternatives for an IV solution and antibiotic produced in Puerto Rico by Baxter International.
The United States is now importing those products from Australia and Ireland, Gottlieb said.
A few medical manufacturing facilities are running on generators. But generators aren't designed to run for months at a time, and most of the facilities cannot get back to full operations until the utility restores the electric grid, Gottlieb said.
“If we get into the first quarter of the next year and these facilities aren't back on the grid, we're going to have some concerns,” he said, adding that the Army Corps of Engineers is prioritizing restoring power to particularly critical sites.
But it's a daunting task. Only 60 percent of the territory's hospitals have been connected to the grid, and even those are keeping their generators close, said Robert Kadlec, assistant secretary for preparedness and response at the Department of Health and Human Services.
Medical device manufacturers need reliable electricity and a lot of it, Gottlieb said, so some firms might not transition from their generators even after the Puerto Rico Electric Power Authority comes back online.
Rep. Diana DeGette, a Colorado Democrat, said the medical device manufacturer Medtronic has already notified her daughter that they cannot deliver her a new insulin pump because of Puerto Rico's crisis.
If even one medical company leaves Puerto Rico, it could be a “fatal” blow to the territory's economy, said Jenniffer González-Colón (R), Puerto Rico's representative in Congress.
House rules barred González-Colón from asking questions during yesterday's hearing. She passed notes to other Republicans so they could ask her questions for her.
Reprinted from Climatewire with permission from E&E News. E&E provides daily coverage of essential energy and environmental news at www.eenews.net.