Obama Issues Executive Order On Drug Shortages
6 CommentsBy Ed Silverman // October 31st, 2011 // 7:06 am
The growing crisis over drug shortages has gotten the attention of the White House, which will issue an executive order to the FDA to broaden reporting of potential shortages of certain drugs; speed reviews of applications to begin or alter production of these drugs; and provide more info to the US Department of Justice about possible collusion or price gouging (read the fact sheet here).
The move comes shortly Congress has held hearings, conducted probes and proposed legislation to address the issue (read the Senate and House bills here and here). The Associated Press recently reported that shortages are responsible for at least 15 patient deaths and that secondary distributors are selling drugs for chemotherapy, anesthesia and infections for inflated prices; in some cases, at up to 80 times the normal price (see here). Overall, there is a record number of shortages this year - the number rose to 178 last year from 56 in 2006, according to the FDA (see here).
The shortage is wreaking havoc. A survey last spring of 311 pharmacy experts at 228 hospitals and other healthcare sites - infusion and surgery centers, retail pharmacies, and long-term care facilities - found they are paying an average of 11 percent more for hard-to-find drugs, and 42 percent bought a more expensive med from gray market vendors. Meanwhile, 89 percent experienced shortages that may have caused a safety issue or error in patient care, and 80 percent pointed to shortages that delayed or cancelled patient care (back story).
Earlier this month, Elijah Cummings, the ranking Democrat on the House Oversight and Government Reform Committee, wrote five distributors after learning that hospitals have complained they have received offers of hard-to-find meds at huge mark-ups. He wants info about how they are obtaining certain drugs and, in turn, how much they are making in profits by selling these drugs to hospitals, pharmacies, and health care providers (read this).
Despite the severity of the problem, Obama reportedly decided against pursuing more dramatic options, such as having the federal stockpile or manufacture drugs, because such a move would insert the government directly into the marketplace and possibly cost more but that might have been more effective, according to The New York Times. However, the White House will send letters to drugmakers to remind them they are legally required to report pending shortages and to encourage notification to the FDA (here is a sample letter).
The reasons for the ongoing shortages are sometimes blamed on consolidation among generic suppliers, since many drugs are made by just one or two manufacturers, and increased enforcement of manufacturing standards by the FDA. However, the White House has released two reports that largely blame shortages on the marketplace [UPDATE: Here is the first report and here is the other one. And here is the FDA action plan].
A recent example that has been used on both sides of the debate has been a unit of Boehringer Ingelheim, which encountered repeated difficulties maintaining quality control at a plant that produced many drugs that have been featured on the FDA shortages list. The Ben Venue Laboratories unit was inspected by both the FDA and European Medicines Agency, which issued harsh reports about practices at its facilities. The unit recently decided to exit contract manufacturing (read here).
pic thx to joguldi on flickr
AnnePME
Thanks, Ed.
Wonder if HCR Federal Upper Limit pricing changes will also have a negative impact. Since the draft list was published, at least one oral med on the list has gone on short.
Salient point
You could make the argument that a marketplace with only one or two entrants is so close to a monopoly that the government might as well enter into it. The concern is that it will turn into another Amtrak or Postal Service, an entity doing the right thing the wrong way for the wrong reasons.
original industry insider
By making compliance voluntary instead of mandatory, Obama should not count on much compliance, seeing that Obamacare in its full flower could cost my industry an estimated 238,000 additional job losses.
Justice in MI
I went back to Ed’s original post on Ben Venue (they can’t even spell French) and the FDA report. Ed’s summation of the findings:
“These included metallic particles or flakes in some medicines, which inspectors suggested came from scrapes on metal doors or window frames; rain water leaking through a ceiling; operators were using gloves that were not sterile and shedding fibrous materials; bacterial contamination in some batches of medicines and mold in classified areas, including manufacturing areas.”
Damn regulation! I like my drugs made in non-sterile conditions with rainwater, mold, bacterial contamination, metallic particles, and fibrous materials.
From now on, I’ll buy my meds in Uzbekibekibekistan.
Or Texas.
john
Good articles in todays NEJM on this.
http://www.nejm.org/doi/full/10.1056/NEJMp1109772?query=OF
http://www.nejm.org/doi/full/10.1056/NEJMp1112633?query=OF
original industry insider
JiM, in that case you may wish to subscribe to Uzbekistan Pharmaceutical News.
http://pharmaceuticals.einnews.com/country/uzbekistan