Baxter's Recalled Heparin: The FDA Can't Keep Up

| About: Baxter International (BAX)
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The FDA and Baxter International (NYSE:BAX) announced Wednesday that a heparin-like molecule found in Baxter’s supplies of heparin may be the culprit in the recent wave of heparin-caused side effects. Baxter, which produces half of the US supply of heparin, has recalled all of its heparin products. Between 5% and 20% of the raw material sampled seemed to be contaminated.

Heparin is harvested from the intestines of pigs. Officials said they were not certain if the molecule was some kind of “bad” heparin that appeared in the supply because of harvesting conditions that were not properly hygienic, whether the pigs themselves were ill, or whether the fake molecule was intentionally introduced as a substitute for naturally produced heparin. Because the heparin-like molecule is chemically similar to the real thing, it can pass many of the tests used to ferret out impurities.

So far in 2007, the FDA has received 785 reports of allergic reactions to heparin, a number that includes 19 deaths. Baxter recalled all of its multi-dose vials of heparin on January 17, and then extended the recall to include all heparin vials on February 29.

Baxter buys its heparin from Scientific Protein Laboratories, which has been supplying drug makers with heparin active pharmaceutical ingredient for 30 years. Four years ago, Scientific Protein Laboratories formed a joint venture called Changzhou SPL with Changzhou Techpool Pharmaceutical Co., to produce the drug in China. Although SPL also sells to other drug-makers, so far only Baxter-produced heparin has been found to be contaminated.

There has been a big hullabaloo about how Changzhou SPL managed to supply an API to a US drug-maker without ever being inspected by the FDA. Although the FDA intended to look at the Changzhou facility, it mixed up the name of the company. It may have inspected the wrong company or become confused, but whatever took place, the FDA never corrected its mistake. However, the lack of inspection was no particular surprise. The Chicago Tribune ran a story (see article) about how little inspection actually gets done.

One of the problems with a proper inspection is that the raw heparin is sourced from small factories where workers extract pulp from pig intestines and then heat it in vats. The same factory may harvest pig intestines for sausage casings. Another company collects heparin from multiple small factories and delivers it to Changzhou SPL. The owner of the pig factory does not keep records of where the pigs come from, and neither does the accumulator company.

As a result, Changzhou SPL does not know the source of its product and can neither inspect its supply chain nor pinpoint the source of emergent problems. If Changzhou SPL cannot trace its supply chain, neither can Special Protein Labs or Baxter or the FDA.

When the Changzhou SPL facility did finally receive its inspection, after the side effect problems moved it abruptly to the front of the inspection queue, the plant did not meet all the FDA standards for hygiene. More importantly, records were missing for some of the testing, and if a particular sample failed a test, the sample was not analyzed to discover what was wrong. Sometimes, the failures were simply dismissed as “outliers.”

Although Congress is asking the FDA to step up its regulatory oversight of foreign-based drug production, there is less money in the budget to perform the inspections than there was five years ago – even though many more drugs are now coming to the US from foreign makers. Only 15 inspections have taken place in China during each of the last five years. Meanwhile, the number of facilities supplying drugs and APIs to the US now surpasses 700.

It does not look like the problem will be solved any time soon.

Disclosure: none.