Officials Release Draft Legislation Aimed at Prescription Drug Shortage Issues

A draft legislative proposal was recently released by Senate Finance Committee Chair Ron Wyden, D-Ore, and Ranking Member Mike Crapo, R-Idaho, that addressed recurrent economic issues that have led to shortages of generic medications, including chemotherapy drugs and ADHD medications.¹

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Researchers from the American Society of Health-system Pharmacists (ASHP) began tracking national drug shortages as early as 2001. The data show that ongoing and active shortages are currently at the highest number (323) since January 2001.² The shortages were aggravated during and following the COVID-19 pandemic, as commonly used drugs experienced a scarcity and prices increased, noted study authors. Following the pandemic, an FDA warning in 2023 predicted future shortages—which are now being seen.³

The shortages include lifesaving products like oxytocin and Rho(D) immune globulin, along with standard of care chemotherapy, pain and sedation medications, and ADHD medications, according to researchers. However, the study authors noted that 12% of all active shortages were impacted by DEA quota changes and allocation practices that started following opioid legal settlements. Not only are the shortages impacting patients, but they have caused challenges for pharmacy staff because of workload requirements.²

In a survey answered by certified pharmacy technicians earlier this year, 96% reported that their pharmacy experienced drug shortages. Among the 96% whose pharmacies faced shortages, 72% indicated that the drug shortages significantly or very significantly impacted their workflow. Additionally, 35% of pharmacy technicians reported that they address drug shortage issues instead of regular pharmacy duties more than 5 times each day.⁴

“It is unacceptable that America is consistently running out of affordable and essential generic medicines,” Wyden said in a news release. “Once again, monopolistic middlemen have put market power and profit over families’ health care. This proposal builds on my work to tear down regulatory barriers that are preventing families from accessing critical drugs like those needed to combat ADHD. Our bipartisan proposal uses the power of Medicare and Medicaid to ensure the entire American health care system has adequate supply for key medicines across the country. Middlemen like GPOs should not be able to do business with Medicare if their contracting practices are actively worsening the drug shortage challenge in America.”¹

The American Hospital Association (AHA) recommended Congress to offer legislation to expand manufacturing sites and sources for critical pharmaceutical ingredients, which could aid the inventory for needed medications. AHA also recommended identification of essential drugs that need more domestic manufacturing capacity, along with requiring drug makers to provide where the products are made and when the demand for the product increases. AHA noted that when there is a drug shortage, hospitals need to find an substitute drug for the patients, which could impact significant costs to the hospital.⁵

“Prescription drug shortages are fueling high prices and limiting access to life-saving treatments and cures,” Crapo said, in a press release.¹

In the proposal, Wyden and Crapo announced that a new program in Medicare hospitals and physicians' offices would be established to “incentivize transparent, reliable, and resilient purchasing practices across supply-chain participants.”¹

The requirements needed by program participants to obtain targeted Medicare incentive payments include a 3-year minimum contract with manufactures for generic drugs that are high risk for shortages, greater purchase volume commitments and stable pricing that limit market distortions that threaten access to essential treatments. Other requirements include contingency contracts with other manufactures to support competition and prevent shortages caused from supply-chain disruptions. Additionally, participants must be transparent on manufacturer quality control issues to potential aid shortfalls and provide exclusive contracting requirements for providers.¹

The study authors noted that the proposal makes changes to the Medicaid Drug Rebate Program (MDRP) that allows reductions or waivers to the inflation rebate for specific generic drugs if a shortage risk occurs.¹

“Our bipartisan discussion draft would take meaningful strides toward mitigating and preventing prescription drug shortages, ensuring that patients can receive the care they need, when they need it. We look forward to working with other members, experts and stakeholders on addressing these life-threatening challenges and promoting consistent, cost-effective health care for Americans nationwide,” said Crapo, in a press release.¹

References

1. Wyden and Crapo Release Draft Legislation to Combat Prescription Drug Shortages. United States Senate Committee on Finance. News release, May 3, 2024. Accessed May 8, 2024. https://www.finance.senate.gov/chairmans-news/wyden-and-crapo-release-draft-legislation-to-combat-prescription-drug-shortages#:~:text=The%20proposal%2C%20released%20as%20a,intermediaries%20(such%20as%20group%20purchasing.

2. ASHP. Drug Shortages Statistics. Accessed May 8, 2024. https://www.ashp.org/drug-shortages/shortage-resources/drug-shortages-statistics?loginreturnUrl=SSOCheckOnly.

3. Mitigating the Effects of Ongoing Drug Shortages. Pharmacy Times. News release. February 21, 2023. Accessed May 8, 2024. https://www.pharmacytimes.com/view/mitigating-the-effects-of-ongoing-drug-shortages.

4. 72% of Pharmacy Technicians Surveyed Report Workflow Affected by Drug Shortages. Pharmacy Times. News release. January 30, 2024. Accessed May 8, 2024. https://www.pharmacytimes.com/view/72-of-pharmacy-technicians-surveyed-report-workflow-affected-by-drug-shortages.

5. AHA recommends legislative action to address chronic drug shortages. American Hospital Association. News release. February 6, 2024. Accessed May 8, 2024. https://www.aha.org/news/headline/2024-02-06-aha-recommends-legislative-action-address-chronic-drug-shortages.