Responding to Unprecedented Demand in the​ Pharmaceutical Supply Chain

We continue to monitor the COVID-19 situation closely and we are actively working with manufacturers, industry partners and government agencies to anticipate shortages and respond to unprecedented demand for certain medications and therapies. We know that the potential for drug shortages or supply disruption is an area of great concern to our customers. As potential shortages or disruptions of products are identified, we’re acting swiftly to address supply continuity.

We are:

  • Securing additional product where available
  • Sourcing back-up products
  • Allocating to ensure equitable distribution
  • Initiating business continuity action planning to maintain and protect operations across all locations and facilities

Securing additional product

We understand the current situation our nation is facing has created unparalleled challenges for our customers and the patients they serve. Please know we are putting forth the full weight of our company, turning over every stone and leveraging every resource, to help keep the supply chain moving and meet this unprecedented challenge.

Steps we’re taking:

  • Assembled a Critical Care Drug Task Force (CCDTF) made up of our procurement specialists and clinical health systems pharmacists to review guidelines and protocols as they are released to forecast changing pharmaceutical demand
  • Leveraging our senior leadership team and CCDTF to predict, allocate and extend supply availability, if possible, to serve customer needs
  • Channeling critical product inventory to geographic areas and sites of care with greatest need
  • Facilitating 24/7 emergency triage response service, as well as a responsive process to evaluate and increase allocations
  • Actively assessing the controlled substance needs and adjusting thresholds, where possible, to meet the surge in demand for these products for critically ill patients

Sourcing back-up product

We are working with manufacturers through several channels, including our ClarusONE and Global sourcing teams in London, and our Pharmaceutical Solutions and Services executives are actively engaged in addressing potential shortages. We have also engaged with industry partners, government agencies and other stakeholders to gain visibility into true supply and demand. In addition, we’re tracking manufacturers’ steps to scale up production or create new capacity, and allocation methodologies to make sure we get medications to the right place.

Allocations

The situation remains very fluid and we are taking a proactive approach to protect inventory during this crisis and make sure our provider partners have needed supplies and medications to treat those that are ill and to help stop the spread of the disease. This includes allocating key product categories to ensure equitable distribution for our customers. While we are working to ensure enough product is available to all our customers, we have a special focus on the acute and long-term-care pharmacies that face significant challenges during this crisis. We will continue to closely and frequently monitor the product needs of these customer classes to identify increased demand and try to prevent future product supply issues.

Allocated product categories include:

  • Antibiotics
  • Statins
  • Antivirals
  • Nebulizer solutions and respiratory medications
  • Antimalarials
  • Critical oncology products that are curative in nature with limited supply options

Although we are allocating products, in almost all cases allocations are set at or above 100% of historical product usage. McKesson will make every effort to provide our customers with a minimum of 100% of their historical usage as long as the product is available. For orders that exceed historical usage, we have a process in place to accommodate reasonable and needed customer requests. In addition, for certain product categories (such as ventilator support medications) we have taken steps to direct additional supply to our hospital customers in areas experiencing increased needs related to the treatment of COVID-19 cases.

Business continuity

As a leading distributor of drugs and other healthcare-related products, we have a robust Business Continuity and Disaster Recovery Program (BCRP).

Our priorities are to:

  • Protect our customers
  • Help ensure the safety of our employees
  • Help ensure our workplaces are safe and secure
  • Help ensure the continuity of critical business processes following natural disasters, human caused threats, and other incidents

Over the last several weeks we have been enacting and updating our BCRP in response to the COVID-19 crisis. In the event of workforce impact, we have several options that will be considered and utilized as appropriate:

  • Utilize network resilience and redundancy – we have the ability to flex and move volume between our distribution centers.
  • Utilize alternate source and back-up product from hub locations through our delivery partner
  • Enact workforce continuity plans:
    • We have established relationships with temp agencies to secure labor.
    • We have identified over 100 associates that have worked in a McKesson distribution center environment at one point in their career. Lists, readiness and training are being provided.
    • In response to extreme impact, we may limit or match demand with capacity to make sure all customers are serviced. This could include limiting deliveries, limiting lines, prioritizing medications and/or longer lead times to service from other areas.

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