FDA Report: Changes in Marketplace Needed to Mitigate Drug Shortages

Major changes to the market are needed to more effectively combat drug shortages and reduce the substantial impact of supply disruptions, according to a new report by the FDA.

The report, which contains an analysis of root causes and potential solutions for drug shortages, comes after the Mitigating Emergency Drug Shortages (MEDS) Act was introduced in the Senate on Tuesday.

Drug shortages have become increasingly prevalent. An FDA analysis presented at a November 2018 public meeting found that the number of ongoing shortages has increased after declining from a peak in 2011 and drug shortages have been lasting longer, in some cases more than 8 years.¹

Most recently, the shortage of chemotherapy agent vincristine, a mainstay treatment for pediatric cancers, sparked concerns of the need to ration doses for patients with cancer. Shortages of older, generic drugs are the most common, often leading to the disruption of widely-used standard-of-care treatments for vulnerable patient populations.

For the report, the agency’s Drug Shortages Task Force commissioned a team of economists and other scientists to analyze drugs that went into shortage between 2013 and 2017. The analysis found that of the 163 drugs that went into shortage over this time, 62% occurred after supply disruptions associated with manufacturing or product quality problems. Based on their analysis, published research studies, and stakeholder input, the task force identified 3 major root causes and proposed recommendations to address them.

In terms of key contributors to drug shortages, FDA experts pointed to the lack of incentives to produce less profitable drugs, lack of recognition or reward to manufacturers for mature quality management systems, and logistical and regulatory challenges that make it difficult to recover from supply disruptions. This pertains especially to manufacturers of older, generic drugs, who face intense price competition, uncertain revenue streams, and high investment requirements, according to the report.

“Unfortunately, incentives today are not high enough for many manufacturers to establish mature quality management capabilities,” Janet Woodcock, MD, director for the Center for Drug Evaluation and Research, wrote in an FDA Voices blog post.² “As a result, drug manufacturers are more likely to keep costs down by minimizing investments in manufacturing quality, leading to quality issues that can trigger supply disruptions and shortages of needed medications.”

To address these shortfalls, the report recommended several potential solutions, including greater transparency, new contracting approaches, and the proposed development of a rating system for manufacturing sites.

On the proposed rating system, Woodcock said that this could be used to inform purchasers, group purchasing organizations (GPOs) for health care systems, and even consumers about the quality management maturity of manufacturing sites. She explained that purchasers currently lack information about which companies have high reliability with their quality management systems.

“This idea envisions that pharmaceutical companies could, at their discretion, disclose the rating of the facilities where their drugs are manufactured,” Woodcock wrote. “Should they choose to disclose this rating, group purchasing organizations and other purchasers could require disclosure of the rating in their contracts with manufacturers.”

The report also outlines several policy proposals and planned initiatives by the FDA, which include new requests in the President’s fiscal year 2020 budget and new guidances that the agency intends to release, specifically on data sharing and risk management requirements.

Organizations such as the American Society of Health System Pharmacists (ASHP), along with other health care groups, have also identified a set of policy ideas aimed at minimizing and preventing drug shortages.

Moreover, if passed, the MEDS Act will likely allow the FDA to further advance these efforts by providing increased authority for the agency, enhanced manufacturing reporting requirements, and new market-based incentives.

Overall, the report concluded that because of the potential scale of impacts from drug shortages, the problem will only persist unless changes to the marketplace are implemented.

References

• FDA Drug Shortages Task force. Drug Shortages: Root Causes and Potential Solutions. 2019. FDA’s website. https://bit.ly/2JDUUXP. Accessed October 30, 2019.
• Woodcock J. To Help Reduce Drug Shortages, We Need Manufacturers to Sell Quality — Not Just Medicine. FDA Voices: Perspectives from FDA Leadership and Experts. https://www.fda.gov/news-events/fda-voices-perspectives-fda-leadership-and-experts/help-reduce-drug-shortages-we-need-manufacturers-sell-quality-not-just-medicine. Accessed October 30, 2019.