As a port strike that stretched from New England to Texas halted nearly half of all trade to the U.S., customs data shows critical medical equipment and drug components for the booming, expensive weight loss and diabetes drugs from Novo Nordisk and Eli Lilly – Ozempic, Wegovy, Mounjaro and Zepbound – are among the trade victims of the ILA union crackdown at the port.

Bills of lading, the digital receipts from shipping containers, show that the delivery mechanisms for insulin and weight loss drugs rely on ports on the East Coast for inbound trade.

“Novo Nordisk and Eli Lilly both rely heavily on the port of Norfolk,” said William George, research director at ImportGenius, which tracks customs data.

Novo Nordisk Imported 419 20-foot equivalent (TEU) containers worth of medicine through Norfolk last year, according to George, and filled injection devices with semaglutide, an ingredient in its brand-name weight loss medication. “Novo fine syringes, commonly used for insulin injections, also come to the US by sea freight,” he said.

Novo Nordisk has generated nearly $50 billion in sales from Wegovy and Ozempic, with the majority of those revenues coming from the United States, its CEO said in recent testimony to the U.S. Senate.

A Novo Nordisk spokesperson said in an email to CNBC that the company has remedial plans in place to minimize or prevent production disruptions due to possible seaport strikes. “We plan to ship our products to and from the United States via air freight,” the spokesperson said.

A Eli Lilly A spokesman said it does not discuss the details of its external supplier relationships.

Dennis Monts, global chief commercial officer at PayCargo, said air traffic volumes increased in September and peaked about two weeks ago. “We are watching October numbers that anticipate an increase in air freight for fast-moving and perishable items such as groceries, seafood, medical supplies and other just-in-time inventory,” Monts said.

Some drug deliveries are labeled “high value drugs” and “low value drugs”.

Other shipments include the active pharmaceutical ingredients (APIs) used in the U.S. to make weight-loss drugs, as well as the syringes and disposable needles.

Noushin Shamsili, CEO and president of Nuco Logistics, which specializes in pharmaceutical imports and exports, told CNBC on Monday that the strike comes at a critical time for replenishing inventories in the drug sector. “Almost the entire industry is on time,” Shamsili said. “Raw materials are brought in to complete drug manufacturing.”

Approximately 48% of active pharmaceutical ingredients (APIs) used in the US are imported from India. Without these active ingredients, no medicines can be produced. APIs are also manufactured in Europe, with East Coast ports also used as US entry points.

Some of these APIs are important components required for the production of the blockbuster weight loss drugs.

“The ILA strike at ports on the East and Gulf Coasts could impact the import and distribution of drugs such as Ozempic,” Shamsili said. “Potential impacts of the strike include supply chain disruptions, increased shipping costs, API inventory shortages and production delays.”

Eli Lilly, maker of Mounjaro and Zepbound, has expanded its manufacturing facilities in the US and Ireland, but is importing some APIs from Swiss manufacturer Corden Pharma to make tirzepatide for the branded drug to be manufactured. Novo Nordisk imports some of its active ingredients for the weight loss drugs Ozempic and Wegovy. The API used for both Ozempic and Wegovy is semaglutide.

There is a risk to medical supplies at East and Gulf Coast ports

The risk to medical care in general is being monitored by the Biden administration and state governments such as New York.

On Monday, Biden administration leadership at the Department of Health and Human Services met with trade associations, distributors, manufacturers and other stakeholders to assess supply chain vulnerabilities and impacts.

“Current preliminary assessments suggest that the immediate impact on medicines, medical devices and infant formula for consumers, parents and carers should be limited,” the government said in a statement. “The administration is taking action to monitor and address potential consumer impacts of labor disputes at East and Gulf Coast ports.”

In addition to HHS, the Food and Drug Administration and the Administration for Strategic Preparedness and Response (ASPR) have been contacting trade associations, distributors, and manufacturers to limit impacts to consumers and assess vulnerabilities.

Shamsili said the East Coast ports are also a gateway for Indian-made generic drugs.

The impact of Hurricane Helene is exacerbating the problem for the healthcare industry supply chain.

Mirko Woitzik, director of intelligence solutions at Everstream Analytics, said a key Baxter International facility in North Cove, North Carolina was damaged. This facility produces IV fluids that supply 60% of the U.S. market, including hospitals. The facility is also the largest U.S. provider of intravenous and peritoneal dialysis solutions.

“The U.S. has just overcome a general shortage of IV fluids that has persisted since 2014 due to production issues, recalls and higher demand due to Covid-19,” Woitzik said. “As of 2023, the U.S. FDA still listed 55 shortages related to IV bags.”

Gov. Kathy Hochul of New York, home to the strike's largest port, said in a statement Monday evening that the state is “working around the clock to ensure our grocery stores and medical facilities have the essential products they need.” need.” “

Woitzik said while other IV fluid manufacturers include the following Intensive care medicine (17% market share) and B. Braun (23% market share) are unlikely to be able to close the supply gap in the short term.

“Infusions are essential medications used in hospitals for routine and intensive care,” said Woitzik. “In the event of a shortage, elective surgeries may be affected and patients may need to stay in hospital longer due to rationing.”

He added that a similar incident occurred in 2017 when Hurricane Maria devastated several pharmaceutical and medical device factories in Puerto Rico, leading to shortages of IV fluids and other patient-critical materials in the United States for years.

The Alliance for Chemical Distribution (ACD) said the strike will cause significant delays, diversions and greater uncertainty in the delivery of essential products at countless US ports.

Brandon Daniels, CEO of supply chain risk management consultant Exiger, said disaster relief organizations and critical infrastructure providers are scrambling to triage the critical assets that are most important and impacted. “Although 90% of container imports of medicines pass through these ports, we found that only 23 of the 165 critical medicines are manufactured only from foreign sources,” Daniels said. “High-quality medicines are sent by air freight. We are more concerned about the existing drug shortages we are already seeing and how this disruption is affecting the ability to source key APIs and precursors for everything from antibiotics to painkillers.”

Daniels also warned that these ports also process consumer goods necessary for disaster relief, such as sterile gloves and medical plastics.