Inside America’s Drug Shortage

The first in a two-part series investigating why critical prescription drugs are in short supply in the U.S.

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Why Don’t Drug Shortages Happen in Other Countries?
The FDA maintains that price controls aren’t the problem and that its system for inspecting and certifying production facilities hasn’t changed. Rather, it’s the companies’ manufacturing issues that account for the majority of the drug shortfalls, the FDA says. Because most generics are older drugs that have been around for many years, they tend to be made in older facilities that have not kept up with the latest standards, making them more vulnerable to violations of FDA requirements. “The reality is that many of these facilities are getting older,” says Dr. Margaret Hamburg, the FDA’s commissioner. “These are not brand-new drugs and manufacturing facilities, so as the manufacturing facilities age, that creates new opportunities for quality and manufacturing concerns.”

The Generic Pharmaceutical Association (GPhA), however, says that in recent years, inspections have become harder to pass. “From the industry’s perspective, the FDA has been much more aggressive in their inspection formats over the past two to four years,” says David Gaugh, senior vice president for regulatory sciences at GPhA, who has had experience at a generic manufacturer.

Further, generic-drug makers say that once the FDA inspects a plant and leaves company officials with a list of items that don’t meet its specifications for quality and safety, the company has 15 days to respond with a plan to address the deficiencies. But the FDA does not always respond with a timely green light for the plan, leaving companies with difficult decisions to make about how much to invest in changes and whether to shut down production lines in the interim.

The good news is, that situation has been changing, and drugmakers say the FDA has recently become more open and communicative about efficiently addressing quality and manufacturing problems. But the ongoing buildup of shortages suggests that the problem goes deeper than sluggish communication during the inspection process.

Why, for example, are the shortages hitting certain kinds of drugs hardest, including those that have to be kept sterile and are made in injectable form? The FDA and drugmakers say it’s because these drugs are more complicated to make, and requirements for ensuring that they remain sterile, and free of any contaminants or foreign objects, are more stringent than they are for punching out pills.

Other observers point once again to the economics, noting that it costs more to manufacture sterile injectables — which include methotrexate and the flu vaccine — while their selling price remains relatively low. They also note that drug shortages are more common in the U.S. than in Europe or other countries, owing primarily to the smaller profit margin for generics here. In the U.K., for example, generic drugs often cost more than brand-name medications because the government health system is the primary purchaser of pharmaceuticals, and their negotiated price for brand drugs are far lower than they are in the U.S.

That also leads to the siphoning of generic drugs from the U.S. supply, which may also contribute to the shortfalls. “Because the profit margin is higher for generic drugs in Europe and outside the U.S., it’s rare to see a shortage in these drugs anywhere but here,” says Kantarjian.

MORE: Why Drugs Cost So Much

Sylvia Bartel, vice president of pharmacy at Dana Farber, says, “I have never seen shortages like this before, especially for drugs that have been around for a really long time that we would not have thought were difficult to obtain. I think a lot of it does have to do with the economics around generics.”

The FDA is confident that it has resolved the immediate emergency around the shortages of methotrexate and Doxil (a brand-name medicine). But will it be enough?

Stay tuned for Part 2 of Healthland’s investigation into drug shortages: “Scrambling for a Solution”

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