Drug shortages are a major challenge in healthcare. According to the U.S. Food and Drug Administration (PDF), the number of drug shortages is rising, with most shortage events lasting longer and resulting in a more adverse impact on public health, including added costs, delayed treatments or even death.
Ultimately, drug shortages create uncertainty for a range of stakeholders: patients, hospitals, manufacturers, pharmacists and others. Especially in cases of shortages for lifesaving drugs, doctors must implement conservative efforts to ensure the patients that need it the most get their medication.
One shortage drug, intravenous immune globulin (IVIG), offers lifesaving treatment for people with compromised immune systems and other often debilitating conditions.
Supply has not kept up with the demand for IVIG, which has grown more than 8% a year as new uses for it have been identified and more people require it. And drugs like L-cysteine, a nutritional supplement used for neonates, are essential at the very beginning of life.
When drugs like IVIG or L-cysteine become a critical shortage, hospitals desperate to provide care may purchase larger quantities than they ordinarily would keep in inventory. Traditional market dynamics have led hospitals to believe that stockpiling will protect their patients in the event that their pipeline of critical drugs dries up. In reality, this often exacerbates shortages for the entire health system and further disrupts the supply chain.
In order to stop this behavior, the industry is in dire need of product availability information that could avert stockpiling. Group purchasing organizations (GPOs) can and should help with this.
Examples like IVIG and L-cysteine are also why there needs to be a focused effort to expand market capacity for critical drugs that have a history of shortage or a limited number of manufacturers. The key to promoting continuous supply is to work with a robust pipeline of quality generic manufacturers to identify shortage drugs, explore solutions to address specific market needs and secure guaranteed supply contracts for active pharmaceutical ingredients.
We also need help from Congress.
First, incentives need to be developed for manufacturers to enter the market with critical drugs to minimize the potential for shortages. This includes incentives for onshore manufacturing to minimize threats to national security.
Incentives should be coupled with requirements for sharing vital information, including redundancy and contingency protocols to minimize disruptions in supply.
Second, we need better insight into the severity and anticipated duration of shortages. This information is essential for GPOs and healthcare providers to plan accordingly. It is also very important for new manufacturers interested in entering the market for a shortage drug. Finally, prioritizing review of drug shortage applications is key to minimizing the impact and intensity of shortages.
There is no single “silver bullet” to solve this public health challenge but, combined, these solutions will set us on a sustainable path to eliminating drug shortages once and for all.
It’s our hope that Congress acts this year to advance these proactive, market-based reforms to ensure a stable supply of critical medications.
Michael J. Alkire is the president of Premier.