(This version of the Jan. 24 story corrects the number of Baxter plants in Puerto Rico making small IV bags to two from three in paragraph five)
By Julie Steenhuysen
CHICAGO (Reuters) - Baxter International informed customers on Wednesday that it has been given approval by U.S. regulators to import large saline bags from its plant in Mexico in an effort to ease hospital shortages of the product as the nation faces a severe flu season.
Supply issues related to Baxter's small-volume saline bags - which are produced in the U.S. market in Puerto Rico - have begun to ease as production there improves, Scott Luce, general manager of Baxter's U.S. Hospital products division, wrote in a letter addressed to customers and seen by Reuters.
Drugmakers including Baxter have been scrambling to meet demand for essential hospital products including IV saline and smaller IV bags, which have been disrupted by prolonged power outages in Puerto Rico after Hurricane Maria pummeled the Caribbean island on Sept. 20.
"Overall, we are making progress on product supply," Luce wrote.
Both of Baxter's two plants in Puerto Rico that make small IV bags - used to mix and deliver a host of medicines to hospital patients - are now connected to the commercial electric grid, the company said.
The company has maintained diesel generators to handle intermittent power outages and has installed backup satellite communications to support plant operations.
Baxter only makes the smaller volume IV products in Puerto Rico; it manufactures larger IV bags elsewhere in the United States.
Shortages of the smaller bags in the wake of the hurricane caused many hospital pharmacists to turn to larger IV bags to deliver medications. Now, with the United States in the throes of one of the worst flu seasons in several years, demand for the larger volume bags - used to hydrate flu patients - has increased dramatically.
"We've been producing as much as we can, but we're not the only one in the market," said Baxter spokesman William Rader.
The market for the larger bags had been constrained even before the hurricane. In August, B. Braun Medical warned customers that production interruptions had caused decreases in supply of the company's small- and large-volume products.
In a statement issued earlier this month, U.S. Food and Drug Administration Commissioner Scott Gottlieb said the agency had given B. Braun and Baxter temporary approval to import products from some of their overseas operations, including allowing Baxter to import product from Brazil. At that time, Gottlieb said he believed the IV fluid shortage would improve shortly.
The FDA has also been working with companies to extend expiration dates on products, when it can be done safely. It recently approved two additional companies - Fresenius Kabi, a unit of Germany's Fresenius, and Spain's Laboratorios Grifols - to supply saline to the U.S. market.
In its letter to customers, Baxter said the FDA has now granted it permanent approval to bring larger IV bags manufactured in Mexico into the U.S. market.
"The news is very good," said Christi Guess, senior director of contract services for Vizient, which negotiates with medical companies on behalf of its member hospitals.
She said with the addition of the products from the Mexico plant, Baxter is now up to 100 percent allocation for most saline products, which means clients can order 100 percent of what they have historically ordered in the past, but no more.
Erin Fox, who tracks nationwide drug shortages and heads the University of Utah health system’s drug information and support services, said saline supply issues remain.
"We're not even close to getting what we used to," she said.
Hospital pharmacists have turned to a number of workarounds to address the shortages. For example, hospitals have used syringes to deliver some medications but that has resulted in shortages of syringes, Fox said.
"It's a house of cards," Fox said. "Each solution you come up with has resulted in some kind of a roadblock."
(Reporting by Julie Steenhuysen; Editing by Cynthia Osterman, Leslie Adler and Frances Kerry)