Federal Probe Targets Generic Drug Shortages: A Path to Stabilizing Essential Medication Supply

The Federal Trade Commission (FTC) and the Department of Health and Human Services (HHS) have launched an inquiry into the shortages of generic drugs, focusing on the role of group purchasing organizations and drug distributors. This investigation comes at a time when drug shortages have hit a 10-year high, impacting essential treatments including chemotherapy.

Experts and industry executives point to several factors contributing to these shortages. Among them is the pricing pressure exerted by powerful middlemen in the supply chain, which has led to below-market pricing strategies and reduced stability in the industry, particularly affecting the production of sterile injectable products crucial for surgical and cancer care.

Efforts to mitigate these shortages include Congressional hearings and proposals for Medicare payment reforms for sterile injectable drugs. The FTC’s inquiry aims to understand if the concentration among intermediary companies disincentivizes competition in the generic drug market.

Five New Drug Shortages:

• Diazepam injection: Used for anxiety, muscle spasms, seizures, and alcohol withdrawal, with some solutions back-ordered.
• Lenalidomide capsule: Treats myelodysplastic syndrome, with significant shortages reported.
• Lisdexamfetamine dimesylate capsule: For attention-deficit/hyperactivity disorder, facing shortages due to regulatory delays and ingredient scarcity.
• Mercaptopurine tablet: A chemotherapy drug for acute lymphoblastic leukemia, with some solutions discontinued or in short supply.
• Rho(D) immune globulin: Experiencing shortages due to active ingredient scarcity and manufacturing issues.

Strategies to Combat Drug Shortages:

Innovative solutions such as artificial intelligence (AI) are being explored to enhance manufacturing efficiency and extend patent lifespans, potentially alleviating some of the challenges faced in drug production and supply. Furthermore, industry experts suggest several long-term solutions to strengthen the pharmaceutical supply chain:

• Supply Chain Transparency: Greater transparency could help purchasers identify and prioritize high-quality and reliable drug sources.
• Technology: Adopting new manufacturing technologies could improve reliability and quality, minimizing shortages due to manufacturing errors.
• National Stockpile: Reimagining the strategic national stockpile to include a buffer of essential medications could respond to surges in demand and give manufacturers time to address production issues.

The current federal inquiry and proposed solutions reflect a concerted effort to address the complex issue of drug shortages, emphasizing the need for systemic changes to ensure the availability of essential medications.