I was trying to understand what caused the Sartan shortage and the reason why it has lasted this long. The problem first surfaced back in 2018 and its now 5-6 quarters old and the company has guided for Sartans “one-off” lasting another 6 months at least.
It looks like unlike the usual causes of shortage like plant closures of a large player or impurities in certain batches of products, in this case, the “impurity” NDMA/NDEA (carcinogenic equivalent of 20 cigs in a day, apparently) in losartan, irbesartan and valsartan is more structural in nature, as it is due to the process used for manufacture itself. This article too explains this simply.
So this has affected not just one batch, label, re-packager, distributor, API manufacturer or company but a messy combination of all, leading to severe recalls and consequently, the shortages. What’s interesting too is that this process has been around since about 2013 but the issue surfaced only in 2018, so stopping something that has worked for so long suddenly is probably not easy. This is the reason why supply hasn’t come back soon as this means changing the process used in the manufacture, and that also means lower yield and a less competitive end-product in terms of margins, not to mention fresh approvals for the new API/process and the fact that some of these players have been placed on import alert.
To give you an idea of how much of supply is probably affected - Here is a list of all Sartan supply that has nitrosamine impurities and this is the list of approved Sartans that don’t have nitrosamine impurities. (Alembic features with 28 Sartans in the second list)
Azithromycin definitely is a fantastic opportunity, and the ability to sell to US at a time of shortages, means that it could play out the way Sartans have played out, perhaps in an even larger scale if HCQ + AZM is proven beyond doubt in clinical studies to be effective. Selling it through the capable US front-end of Alembic could result in higher margins (80-90%) as well if it happens. We should know in a couple of weeks how it plays out.