OECD/NEA highlights challenges facing isotope supply chain

Wednesday, 20 November 2019

No medical radioisotope is more important than Tc-99m, NEA Director General William Magwood said at the launch of The Supply of Medical Radioisotopes: An Economic Diagnosis and Possible Solutions on 18 November. The radioisotope is used some 30 million times each year around the world to diagnose cancer and other diseases, he said. However the properties of Tc-99m mean its supply chain is complicated and the isotope - and the molybdenum-99 (Mo-99) used to generate it in hospitals - cannot be stored.

Operation of the research reactors in which radioisotopes are produced is generally subsidised by the governments of the countries where they are based.

"As commercial companies come into this market they are finding it very difficult to make a profit and be successful, and to sustain operation, under the current circumstances," Magwood said. "In order to make sure there is a stable supply, we have to ensure there is a stable market."

Severe shortages in Tc-99m supply experienced in 2009-2010, following unexpected or prolonged shutdowns at Mo-99 production facilities, led to an "unacceptable" situation where patients could not be diagnosed or had to be diagnosed by alternative methods, including invasive surgery, Magwood said.

The OECD NEA High-Level Group on the security of supply of Medical Radioisotopes (HLG-MR) was formed in 2009 in response to this situation, bringing together government, industrial, research and health communities to investigate ways to avoid such shortages in future and ensure a stable, economically sustainable supply of medical radioisotopes in both the short and long term.

The new report presents the findings of a study requested by the HLG-MR in 2017 to describe the need for radioisotopes in national health systems and analyse the current market structure, focusing on Australia, Canada, Japan and the USA - the four non-European countries that are the largest end-users of Tc-99m - as well as the countries of the European Union, and Switzerland. It was prepared with the support of the OECD Health Committee, and identifies barriers to implementation of full-cost recovery (FCR), the first of six policy principles in the HLG-MR's framework plan to encourage price increases in the supply chain and thereby help to ensure stability of supply.

Mark Pearson, deputy director of employment, labour and social affairs at the OECD, said nuclear medical techniques continue to be essential for the diagnosis of many diseases in OECD countries, with Tc-99m used in about 85% of nuclear diagnostic scans worldwide. While it is possible in some areas to substitute Tc-99m with other techniques that rely on medical radioisotopes other than Tc-99 - such as positron emission tomography, and non-radioisotope techniques, such as computerised tomography, magnetic resonance imaging and ultrasound - this is costly, both in terms of actual scan cost and investment in alternative equipment and human resources to administer them. In some areas there are no comparable substitutes for Tc-99m, and there are also instances where Tc-99m scans are superior to other options, such as whole-body bone scans for cancer. A reliable supply of Tc-99m is therefore essential for effective patient care in OECD countries and beyond, he said.

Policy proposals

A previous economic analysis carried out by the group in 2010 found government funding of research reactors has allowed Mo-99 production to continue despite unsustainably low prices, but also distorted price signals in the supply chain.

The current structure of the supply chain leaves some participants unable to increase the prices of their services sufficiently to cover all fixed and variable costs of the required production capacity for Tc-99m, the report finds.

OECD Health Policy Analyst Martin Wenzl, who edited the report, said a 40% price increase from irradiators would be needed to achieve FCR. The average cost of Tc-99m per patient dose is around USD21, which is small compared to the overall cost of a diagnostic scan, so the price increase required to achieve FCR in the isotope supply chain would also be small and could easily be absorbed by health care providers, he said.

The barriers to achieving FCR lie within the supply chain itself, Wenzl said. The report presents a number of possible policy options to overcome these barriers and improve reliability of supply. These include: withdrawing government funding for the commercial production of Mo-99; increased price transparency; price regulation for irradiation services; the establishment of a commodities trading platform for bulk Mo-99; and requiring the governments of end-user countries to bear the costs in proportion to the share of total supply they consume.

The report also identifies two further policy options to reduce the reliance on the current Mo-99/Tc-99m supply chain. These are: increasing the use of substitute diagnostic imaging techniques or substitute isotopes; and moving towards alternative, non-reactor, methods of producing Mo-99/Tc-99m. However, these alternative production methods may be more costly than irradiation by nuclear research reactors and require substantial investment in capital and time to be brought to market, the report notes, adding that "production capacity will not be readily available soon for commercial supply of the world market".

"We are not recommending a single solution at the moment … clearly further cooperation between governments of producing countries and supply chain participants is needed to coordinate further efforts in order to identify the solutions that work best in local context," Wendl said.

Not critical but fragile

Jan Horst Keppler, Senior Economist at the NEA, presented the Agency's projections for medical radioisotope supply and demand for the period to 2024. NEA projections of isotope demand growth are lower than current processing capacity over the next five years, but when a 35% outage reserve capacity is allowed for, existing  capacity would no longer be sufficient to meet projected demand by 2024. The emergence of new technologies - such as non-reactor methods - coming on stream in the later part of the period might result in capacity increases, but these technologies are not yet "tried and tested", he said. Project delays or cancellations of new investment could also pose risks to supply.
 
"The situation is not critical at the moment, but remains fragile," Keppler said.