When Hurricane Maria flattened Puerto Rico in September, the damage and loss was catastrophic. But unless we had family ties to the island, the disaster seemed distant, barely touching our lives in the mainland … but we were wrong. The ripple effect from Maria has surged far past the island itself and into the hospitals and clinics of the mainland.
In the late ’60s and ‘70s, US pharmaceutical companies began shifting their base of operations to Puerto Rico in order to take advantage of a federal tax incentive known as Section 936. This incentive allowed US-based manufacturers to siphon all profits from local PR plants to stateside parent plants without paying any federal taxes. When 936 expired in 2006, Acts 20 and 22 sprang up to take its place, making dividends paid from profits on exported services 100% tax exempt to individual recipients.
There are at least 50 pharmaceutical plants on the island, including Pfizer, Merck, Eli Lilly, Johnson & Johnson, Bristol-Myers Squibb and Amgen. An additional 30 plants make medical devices. The industry employs 90,000 workers and accounts for about 75% of the goods shipped off the island. Puerto Rico produces 16 of the top 20 selling drugs in the continental US, including ones used in the treatment of cancer and HIV, and immunosuppressants for transplant patients. The best-selling blood thinner Xarelto and the cholesterol drug Lipitor are imported from PR. Every one of these companies was affected by Maria. But it is not the lack of these widely known pharmaceuticals that is throwing a wrench in everyday operations in hospitals, rather a seemingly innocuous product that has, up until now, remained an invisible mainstay of many medical procedures.
Baxter International Inc., the biggest US supplier of pharmaceutical saline, has its main manufacturing plants in PR. Since Maria, shortages of saline have cost hospitals both time and money. Small solution bags, about $1.50 each, are the preferred method for delivering everything from painkillers and antibiotics to chemotherapy and heart drugs. Lacking this basic supply, nurses have to stand for 30 minutes and administer a drug slowly through a syringe by hand. Even before Maria, supplies were becoming problematic, but the storm exacerbated shortages to such a degree that the American Hospital Association recently stated that the US healthcare system was “on the brink of a significant public health crisis.”
But this “new” crisis has been years in the making; had the corporations taken their heads out of their wallets, they might have seen it coming. Such basic hospital supplies as saline, which lack the huge profits raked in by much-hyped high-cost wonder drugs, have been low priorities for the pharmaceutical conglomerates, so outmoded factories weren’t modernized to ramp up supply. To make matters worse, there were no alternatives in place in the event of interruptions in production. B. Braun Medical Inc., one of the few other major saline suppliers, received a warning letter from the Food and Drug Administration due to reports of leaky and moldy intravenous bags. Another alternative supplier, ICU Medical Inc., has been unable to keep up with the increased demand. The industry is now swept up in a US Department of Justice criminal probe of possible collusion and price-fixing.
The saline shortage may be just the tip of the iceberg, with more medical shortages in the offing. According to the drug information service at University of Utah Health, supplies are dwindling for 174 different drugs, leaving very little leeway in the case of emergency events. Such staples as syringes of sodium bicarbonate, used for heart attack patients, and certain injected forms of morphine, are also in short supply. Due to the continuing widespread power outages in PR, even facilities that initially sustained only minor damage are working at partial capacity. New shortages could result, with those that existed before the storms continuing unabated.
On December 28, the FDA acknowledged that although they were working very closely with the pharmaceutical facilities and local officials, the shortage of IV fluids was not expected to improve until early 2018 “based on the information we are receiving from the manufacturers.” In the meantime, the nurses and staff workers, along with the patients, are bearing the burden of widespread backorders.
Today, about 45% of Puerto Rico is still without power. It is a problem that no one was prepared to deal with. In hindsight, perhaps the idea of turning an island into a handy tax break with no thought to upkeep or long-term viability may not have been such a good move after all. Sadly, the current administration does not seem to consider the needs of an island far off the mainland to be a priority when they are so intent on maintaining the border sanctity of the continental US. A recent San Diego Union Tribune editorial called the US failure to adequately help Americans in Puerto Rico “shamefully appalling.” The shortsightedness of this decision may soon come back to bite some big business butts.
