In reality, the drug shortages in the US market appeared against the general trend, which has seen drug shortages falling dramatically since 2011.
In 2011, there were 250 incidences of drug shortages but in 2017 there were less than 50 such cases.
However, the US Food and Drug Administration (FDA) has observed a slight uptick in the number of drug shortages, with marginal increases in 2016 and 2017 compared to 2015 that warranted creating a task force.
FDA commissioner, Scott Gottlieb, outlined several broad reasons that the Agency had identified to be behind drug shortages in a statement: “Historically, many drugs in short supply have been low-profit margin generic medicines. Many are sterile, parenteral drugs, which can be challenging to manufacture.”
He continued: “The low-profit margins, and the significant cost of manufacturing these complex drugs, has resulted in consolidation in the industry. The only way to produce these low-margin products profitably is to manufacture them at tremendous scale. This has resulted in fewer and fewer manufacturers for certain key products. The result is very little margin for error in this space.”
Gottlieb also identified the lack of profit made by these products as a reason for ‘under-investment’ in manufacturing, signalling that this can lead to production mistakes that stop supply. With a consolidated market, the halting of manufacture means that the availability of a medicine can be limited until the problem is rectified.
Developing financial incentives
As mentioned by Gottlieb, the low profit margins of products that tend to suffer these shortages is one of the issues behind maintaining an efficient manufacturing network. In response, the task force will be encouraged to develop ways to protect the supply in return for financial incentives.
With this being offered as the carrot, the statement also suggested that the task force could use the stick of requiring manufacturers to conduct risk assessment for potential vulnerabilities in the production process, as another means of ensuring supply.
However, in some quarters, patience with the intermittent supply of certain products, and the general rise of the price of generics, has already run out – leading five healthcare associations to form their own generic drug manufacturing firm.
A spokesperson for PhRMA replied to a request for comment stating: “We believe drug shortages are a multi-faceted issue and we look forward to learning more about the Drug Shortage Task Force announced by the FDA. While there are many proposals to combat this issue, it is critical all stakeholders work collaboratively with the agency towards the goal of mitigating future shortages to protect patients.”