B. Braun announces $1 billion investment in manufacturing to alleviate IV fluid shortages in the U.S.

May 15-- May 15--At various points in recent years, there have been nationwide shortages of IV fluids, which health care professionals use to hydrate patients, administer drugs and replace lost blood volume.

On Tuesday, one of the main suppliers of those fluids, B. Braun Medical Inc. of Bethlehem, took a leap out of its usual press-shy shell to make a very public announcement in Washington, D.C., about its plan to alleviate future shortages.

The initiative, called Solutions for Life, is B. Braun's response to the problem -- a reply that comes with a more than $1 billion investment in new and updated manufacturing facilities across the United States that should help ensure a reliable and consistent supply of IV fluids. Part of that ongoing investment includes a major expansion of B. Braun's IV therapy-device manufacturing operations in Lehigh Valley Industrial Park III in Hanover Township, Lehigh County.

"These are absolutely critical solutions for health care in general, so we are very proud of this investment and, like I said, we see this as the right thing to do," said Maria Angela Karpf, a corporate vice president who oversees medical affairs at B. Braun. "And therefore, we're definitely talking about it."

The shortages have popped up after particularly challenging flu seasons and following severe weather events. For example, when Hurricane Maria hit Puerto Rico in 2017, it left many pharmaceutical plants on the island, including those of fellow saline solution provider Baxter International Inc., in limited production on backup generators as they waited for electricity to be restored. Baxter spokesman Eric Tatro said all of the company's facilities were connected to the power grid by late 2017 and returned to pre-hurricane manufacturing levels in early 2018.

Inventory levels became further strained when B. Braun shut down its Irvine, Calif., manufacturing facility in December 2017 to complete "critical routine maintenance," work that was done in early January 2018.

To address future shortages, B. Braun and Baxter both noted that they obtained U.S. Food and Drug Administration approval to import IV solutions from their manufacturing facilities abroad. And Tatro noted that, like B. Braun, Baxter has invested in its U.S. plants, funneling more than $500 million into IV solutions manufacturing since 2016.

"We use it in everything we do"

As the recent shortage grew, health care providers had to scramble to identify alternative treatment methods, and in some cases, delay treatments so IV bags and fluids could be used for patients who needed them most, according to panelists who participated in a discussion Tuesday following B. Braun's announcement.

"When you look at IV fluids, it's a staple. It's water," said David Gillan, senior vice president of sourcing operations for Vizient, a health care performance improvement company. "We use it in everything we do."

Switching to other treatments had ripple effects: using more needles and syringes to deliver medications in other ways meant those devices were in shorter supply, Gillan said. Those changes in standard treatment approaches also increased costs and the potential for medical errors, several panelists noted.

Felicia Schaps, general manager of ContinuumRX, which provides home infusion therapies, said smaller organizations without the bargaining power of larger hospital chains struggled to acquire enough supplies during shortages and in some cases turned away patients. That meant more people were staying in the hospital instead of receiving care at home.

Panelists representing distributors, health care providers, pharmacists and others within the medical supply chain said the shortage emphasized the need for redundancy in the system to deal with greater demand, as well as communication that would allow for responding quickly.

They also said the IV fluids aren't the only area where there are shortages, with more than 200 drugs listed as in short supply on any given day.

What B. Braun is doing about it

Karpf, who is based at B. Braun's manufacturing facility at 901 Marcon Blvd. in Hanover Township, sees the company's efforts to alleviate IV fluid shortages directly next door to her building.

There, at 939 Marcon Blvd., construction has started on an expansion that will include a 310,000-square-foot building, a 10,295-square-foot maintenance structure and a parking lot, giving B. Braun more capacity to make products such as the catheters and extension sets necessary for IV therapy. That expansion is slated for completion sometime in 2021, said B. Braun spokeswoman Allison Longenhagen, who declined to say how many jobs the plant would create. (Township officials told The Morning Call last year that the expansion would create 250 jobs.)

The building at 901 Marcon Blvd., which is about 400,000 square feet, employs 1,100, she said.

Aside from the Lehigh Valley, B. Braun plans to open a manufacturing facility in Daytona Beach, Fla., by the end of 2019 and will modernize its plant that employs 2,000 people in Irvine, giving the company a large-scale manufacturing plant on both coasts and helping to boost the company's IV fluid production capacity over the next several years.

Also, B. Braun said in its 2018 annual report that it expects to complete the necessary work to its Irvine plant in the 2019 fiscal year as a result of a 2017 warning letter from the FDA over repeat violations.

In addition, the company opened a distribution center in Daytona Beach and will carry out enhancements to its distribution facilities in California and Breinigsville, the latter of which employs 84 people. (Aside from Hanover Township and Breinigsville, B. Braun employs 300 at its Bethlehem headquarters and another 150 in satellite offices around the region. B. Braun affiliate, Central Admixture Pharmacy Services, employs another 150 in the area.)

The $1 billion-plus investment is geared toward providing health care providers with the supplies they need, so patient treatment doesn't have to be delayed or alternate techniques found. But, Karpf said, improved planning among various parties is still needed to eradicate the problem.

"There is more that needs to be done," she said.

Morning Call reporter Jon Harris can be reached at 610-820-6779 or at jon.harris@mcall.com.

Washington correspondent Laura Olson can be reached at 202-780-9540 or lolson@mcall.com.

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