Drug Shortages in the United States
By Rina Shah, U.S. Office of Personnel Management on National Healthcare Operations,
According to the American Society of Health System Pharmacists (“ASHP”), there are currently about 200 drug shortages, ranging from the Acetazolamide Injection to the Zoster Vaccine Live.2 A recent study claimed that these numerous drug shortages are not as bad as they seem because they are limited to a few disease areas and generic injectables.3 Despite the purportedly limited scope, drugs that are vital to treating major diseases such as childhood leukemia and breast cancer are part of the current shortages.4 Due to concerns about delays in treatment, increased morbidity and mortality, and higher healthcare costs,5 manufacturers and the government have been attempting to remedy the issue. As government legislation is still pending and other responses are fairly recent, there has not been any reliable information to indicate whether these strategies are working.
Causes of Drug Shortages
The source of drug shortages varies from drug to drug, but the primary reasons are manufacturing problems combined with increased demand.6 For example, a shortage of the dopamine injection was reported by ASPH on November 17, 2011.7 The reasons for the shortage were listed by one manufacturer as a manufacturing delay and by another as increased demand.8 Another drug that is currently experiencing a shortage, the tobramycin injection, is reportedly in short supply because of manufacturing delays.9
The Government Accountability Office (“GAO”) examined the shortages in a November 2011 report.10 The report noted that manufacturing delays caused by quality issues that suspended or shut down production as well as supplier delays for similar reasons were largely to blame.11 The report identified the limited resources of the Food and Drug Administration (“FDA”), which regulates the manufacturing and marketing of drugs and medical devices, and the lack of early reporting obligations of manufacturers as major obstacles.12 The FDA is unable to work with the manufacturer to resume normal production nor is the FDA able to secure alternate supplies of these drugs.13
Pharmaceutical companies, particularly those that produce generics, are considering this problem to be an opportunity for growth. Companies such as Pfizer and Sanofi have an extensive list of generics that are produced and marketed exclusively outside of the United States.14 Pfizer has begun to market generic versions of a drug that it used to sell in the United States on patent, and Sanofi has also offered to make its generics available.15 The issue with the introduction of off-patent products like the ones Pfizer is marketing is that there are sometimes insufficient financial incentives to warrant offering these generics in the United States.16 With the drug shortages, the prices of generic versions of these manufacturers’ off-patent products now provide sufficient profit to incentivize offering these products in the United States.
Other manufacturers are seizing the opportunity to create niche businesses. For example, Cantrell Drug Company offers to prepare drugs that are currently discontinued or on backorder.17 With FDA-registered product lines for pain management and sterile admixtures, as well as custom compounding services, Cantrell is able to fill some of the needs created by the drug shortages.18 Other businesses are simply buying up stocks of certain drugs and selling them at a markup due to high demand and backordered manufacturing.19 This latter strategy is being targeted by one of the government responses discussed below.
As mentioned, manufacturing problems are a primary cause of drug shortages. Focus by manufacturers and the government has not been on preventing these issues but instead on how to manage them when they do occur, since preventative measures, such as quality improvement can be costly. Even if the drug manufacturers were able to address their own quality issues, supplier manufacturing delays also lead to shortages. Currently, the pharmaceutical industry does not react until there is a shortage resulting from supplier delays. The industry must implement contingency plans for how to continue production in cases of supplier delays. Finally, stockpiling these drugs may not be common because of the costs associated with maintaining additional stock.
A long-term solution requires legislative and regulatory measures. On October 31, 2011, President Obama issued an Executive Order that directed the FDA and the Department of Justice (“DOJ”) to work towards early action to reduce and prevent drug shortages.20 Steps include reiterating the legal responsibility of manufacturers to notify the FDA of discontinuations, directing the DOJ to work with the FDA to fight price gouging and hoarding of medicines, and mandating notification of impending drug shortages through bipartisan legislation.21 While the DOJ and FDA are working as directed in the Executive Order, the legislation is still pending and was last referred to House Committee on Energy and Commerce and the Subcommittee on Health.22
The FDA is also increasing staff to respond to drug shortages, in response to a report by the HHS Assistant Secretary for Planning and Evaluation assessing the underlying factors of prescription drug shortages.23 The duties for these additional staff members include working with the manufacturer to restore production quantities, encouraging others that manufacture the compound to do so in higher quantities, and fast-tracking review of submissions by manufacturers that can impact production.24 Submissions by manufacturers that the FDA will expedite include requests to increase capacity, extend expiration dates, use a new source for a raw material, and change product specifications.25 Additionally, the FDA has issued an interim final rule requiring manufacturers that are the sole producers of products that are life-supporting, life-saving, or used for preventing a debilitating condition or disease to report production delays or interruptions to the FDA.26
Drug shortages have been growing in the United States and can have an alarming impact. Rationing is already occurring in many hospitals.27 The cost of trying to find substitute therapies or generics is estimated to be about $200 million annually.28 In order to successfully address this problem, efforts must be made by pharmaceutical manufacturers to prevent and remedy shortages; legislators to enhance oversight of manufacturers and enable solutions to shortages; and regulators to work with the pharmaceutical industry in solving and preventing shortages. Only time can tell if the current measures will have a lasting impact.
Rina Shah, J.D., MSc, is a Policy Analyst working with the U.S. Office of Personnel Management on National Healthcare Operations. Ms. Shah can be reached at Rina.Shah@opm.gov or (202) 606-1427.
|2 ||American Society of Health System Pharmacists, Drug Shortages: Current Drugs, http://www.ashp.org/DrugShortages/Current/ ASHP, an association representing pharmacists who work in hospitals and health systems, provides a bulletin on each drug shortage that contains the reason for the shortage, possible resolution timeframe, and related shortages.|
Lynne Taylor, US Drug Shortages “disruptive, but narrowly concentrated”, PharmaTimes Online, available at http://www.pharmatimes.com/Article/11-11-15/US_drug_shortages_disruptive_but_narrowly_concentrated.aspx.
ASHP, supra note 2.
Bruce Chabner, DrugShortages – A Critical Challenge for Generic-Drug Market, 365 N.E.J.M. 2147, available at http://www.nejm.org/doi/full/10.1056/NEJMp1112633.
ASHP, Dopamine Injection, http://www.ashp.org/DrugShortages/Current/Bulletin.aspx?id=88.
ASHP, Tobramycin Injection, http://www.ashp.org/DrugShortages/Current/Bulletin.aspx?id=701.
Government Accountability Office, FDA’s Ability to Respond Should be Strengthened (2011), available at http://www.gao.gov/assets/590/587000.pdf.
Cantrell Drug Company, Drug Shortage Solutions, Health Sys. Infusion 41 (2011).
Chabner, supra note 7.
The White House Office of the Press Secretary, Fact Sheet: Obama Administration Takes Action to Reduce Prescription Drug Shortages in the U.S., http://www.whitehouse.gov/the-press-office/2011/10/31/fact-sheet-obama-administration-takes-action-reduce-prescription-drug-sh.
H.R. 2245, Bill Summary & Status, http://thomas.loc.gov/cgi-bin/bdquery/z?d112:h.r.02245.
The White House Office of the Press Secretary, supra note 21.
Food and Drug Administration, A Review of FDA’s Approach to Medical Product Shortages (2011), available at http://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/UCM277755.pdf.
|26 ||U.S. Department of Health and Human Services, Fact Sheet: Continued Progress on Reducing Drug Shortages, http://www.hhs.gov/news/press/2011pres/12/20111215a_fda.html.|
|27 ||Michael Booth, Remedy for U.S. drug shortages eludes hospitals, lawmakers, Denver Post (Aug. 7, 2011), available at http://www.denverpost.com/news/ci_18632610.|
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