Hospital Drug Shortages Cost $900M in Labor According to Vizient Survey

Hospitals across the US spent over 20 million hours in 2023 managing drug shortages — costing nearly $900 million in labor expenses, according to Vizient’s 2024 Drug Shortages Survey.

The problem, once seen as sporadic, has now become a structural burden across hospital systems.

Conducted from April to September 2024, the survey collected data from 132 Vizient hospitals in 2023. Nearly three-quarters of facilities exceeded their pharmacy budgets, with pediatric centers reporting the highest impact.

General hospital pharmacy staff now spend 24.2 hours weekly managing shortages, up from 10.5 in 2019. Pediatric hospitals logged even higher hours. Most facilities redistributed tasks (48% to 60%) or used overtime (23% to 36%), while a few hired additional staff (2% to 11%).

Two recent developments highlight why hospitals are pushing for long-term solutions. The United States Pharmacopeia’s (USP’s) 2024-2025 Vulnerable Medicines List names 100 high-risk essential drugs — 71% injectables — based on over 100 vulnerability indicators to prompt early action. Meanwhile, President Donald Trump’s proposed 25% import tax on pharmaceuticals could raise prescription costs by $600 per household. Experts warn the tariffs may discourage production of already low-margin, shortage-prone drugs.

According to the survey, hospitals tracked a median of 43 active drug shortages in 2023; some monitored up to 70. Pediatric hospitals reported more, needing age-specific formulations.

Commonly impacted drugs included lorazepam, dextrose syringes, ketamine and sodium bicarbonate. Oncology drugs like cisplatin and methotrexate also ranked high, along with pediatric agents like topotecan and bupivacaine.

Clinical disruptions followed: 41% of outpatient infusions were delayed or missed, along with 32% of scheduled procedures and 22% of admissions. Emergency care was affected in 15% of cases. Medication errors tied to substitutions or unfamiliar products occurred in 43% of facilities — up from 38% in 2019.

When primary channels failed, nearly half of the hospitals turned to secondary distributors outside traditional networks. These purchases came with steep costs, averaging a 214% markup, with some molecules seeing spikes as high as 600%.

Communication was another challenge. A third of hospitals called for earlier alerts from manufacturers. Others cited the need for centralized tracking, clearer release timelines and real-time manufacturer updates.

In addition to surging labor costs, facilities are often forced to rely on secondary distributors — unregulated or gray market suppliers — when traditional supply channels run dry.

Vizient has expanded its mitigation infrastructure in response. Its Novaplus Enhanced Supply (NES) and NES Reserve programs have provided access to over 4 million additional units of critical medications since 2021, including 750,000 units of high-impact drugs cited in the 2024 survey. As a result, nearly two-thirds of respondent hospitals reduced supply risk and avoided emergency purchasing.

The programs also helped avoid $300 million in inventory-related costs by improving pricing consistency and reducing secondary sourcing. Vizient’s updated Essential Medications List now includes demand forecasts and market resilience metrics for better planning.

The company developed 63 mitigation protocols and a stewardship model supporting coordination, formulary evaluation and responsible stockpiling. In 2024, it also introduced key performance indicators (KPIs) to help hospitals track and manage the impacts of shortages in real-time.

A Global Reminder of What’s at Stake

Drug shortages aren’t just costly; they have strong consequences. In Gaza, prolonged supply blockades have depleted antibiotics and painkillers. Hospitals struggle to treat burns and infections, and malnourished children may face delayed or inadequate treatment.

In Kenya, a shortage of nevirapine — critical for preventing HIV transmission from mothers to newborns — is putting infants at risk. Linked to a pause in US aid shipments, the disruption could set back years of HIV prevention progress.

Emerging Approaches for Resilient Drug Access

Hospitals are exploring alternatives to shore up supply. Cencora’s Sure Supply program now includes nearly 200 drugs with six-month safety stocks, helping health systems weather national disruptions.

Germfree and On Demand Pharmaceuticals began piloting on-site drug manufacturing platforms in 2024, before tariff plans were introduced. These systems enable hospitals to prepare medications like lidocaine and potassium chloride directly at the point-of-care, offering a decentralized option to ease dependency on large manufacturers.

Civica, a nonprofit generics supplier serving over 1,400 hospitals, continues expanding its portfolio of sterile injectables. Its cost-plus pricing and US-based manufacturing aim for stable access and fewer disruptions.

The world is grappling, and the cracks are widening. Vizient’s findings lay bare a reality that calls for bold, creative responses.

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