How Pharma Companies Can Defend Against Third-Party Cyber Threats

Cybercriminals’ tactics have evolved to target sensitive data and disrupt research and development in the pharmaceutical ecosystem through a highly effective hub-and-spoke strategy. This new method has attackers compromising a single common vendor — the hub — to access numerous pharma companies — the spokes. Why go for individual companies when you can simply strike their common denominator and achieve the same results? Cybercriminals can extract vast amounts of data, disrupt entire production lines and demand higher ransom payments due to the widespread impact. 

Third-party cyberattacks have sabotaged healthcare systems. A single ransomware aggression on a mission-critical supplier can cascade through the industry, wreaking havoc on drug manufacturing, clinical trials and supply chain logistics. And with the pharmaceutical sector being so deeply interconnected with vendors, suppliers and distributors, it faces a broad expanse of third-party cybersecurity risks. Pharmaceutical companies must act proactively to mitigate these threats. Below are key strategies to bolster third-party cybersecurity resilience.

1. Establish a Robust Third-Party Risk Management (TPRM) Program

Danger lurks, and it’s only a matter of when, not if. Pharma companies must develop a comprehensive TPRM framework to assess and manage vendor risks effectively. With third-party attacks causing 29% of data breaches, a proactive approach is critical in sealing off the risk. This includes maintaining an up-to-date inventory of all third-party vendors, including subcontractors and categorizing them based on risk exposure.

Companies should also conduct in-depth cybersecurity assessments before onboarding new vendors to evaluate their security posture. Ongoing monitoring through periodic audits and security performance ratings helps identify potential risks associated with third-party vendors. 

2. Implement Strict Cybersecurity and Compliance Requirements in Vendor Contracts

Pharmaceutical companies should ensure that all vendor contracts include stringent cybersecurity obligations, such as:

• Security standards compliance: Require vendors to adhere to industry standards such as NIST Cybersecurity Framework, ISO 27001 and HIPAA for patient-related data.
• Cyber liability insurance: Mandate that third-party vendors maintain cyber liability insurance to mitigate financial losses in the event of a cyberattack.
• Incident reporting and response: Clearly define breach notification timelines and responsibilities in contracts to facilitate rapid incident response.

3. Enforce Multi-Layered Security Controls for Third-Party Access

Implement zero-trust architecture, which entails removing inherent trust and assuming strict hostility toward every access request. This includes requiring verification of every user and device attempting to access sensitive data.

Single-layer password protection is also weak against attacks, but too many passwords mean a lot of particulars to manage. Opt for multi-factor authentication and require vendors to use more than just a password for all logins to reduce the risk of credential-based attacks. Options include sending a single-use code to a company mail, answering a secret question or scanning a fingerprint. 

To reduce attack surfaces and minimize the misuse of privileged access, grant vendors only the minimum level of access to the specific data they need to perform their functions.

4. Strengthen Incident Response and Business Continuity Planning

Given the potential disruption caused by cyberattacks, pharmaceutical companies must develop and test comprehensive response plans that include testing third-party risk scenarios, backing up critical information and systems and coordinating with regulatory agencies.

Conducting tabletop exercises simulating ransomware or supply chain attacks on vendors allows the company to envision the possible risks associated with each vendor. It’s also essential to have secure backups that can be restored quickly in case of an attack. A company’s incident response plan should align with current industry regulations, such as FDA cybersecurity guidelines, to ensure compliance and rapid reporting.

5. Invest in Continuous Cybersecurity Awareness and Training

Human error remains a significant vulnerability in cybersecurity, causing as much as 74% of data breaches. To minimize the room for mistakes from within the organization, pharmaceutical companies should educate employees and vendors by providing ongoing cybersecurity training on phishing, ransomware and social engineering attacks.

Translate the concepts into simulated phishing campaigns and regularly test personnel with real-world phishing examples to enhance their detection skills. All suspicious activities should also be proactively reported to develop a cybersecurity culture within the organization.

Fortify the Pharmaceutical Industry’s Defenses

The time to act is now. Revenue and reputation aren’t the only things at risk. With patient safety, intellectual property and regulatory compliance at stake, pharma companies must invest in the continuous and proactive defense of every aspect of their operations, including third-party associates.