To Fix Drug Shortages, Bring Manufacturing Home, Experts Say

— Onshoring and “near-shoring” of drug manufacturing could help, as would transparency

by Shannon Firth, Washington Correspondent, MedPage Today February 7, 2024

To prevent future drug shortages, domestic manufacturing, “near-shoring,” and increased transparency of the drug supply chain are badly needed, experts told lawmakers during a hearing of the House Committee on Ways & Means on Tuesday.

There are currently about 250 drugs in shortage in the U.S., witnesses at the hearing noted.

In written testimony, Stephen Schleicher, MD, MBA, chief medical officer for Tennessee Oncology, said he had no option other than to ration supplies last June, after more than a week without regular shipments of the chemotherapy drugs carboplatin and cisplatin.

Because of these shortages, the self-described “largest provider of cancer care in the state” was unable to treat 90% of patients who required carboplatin and more than 50% of patients needing cisplatin, he noted.

While the “immediate cause” of most shortages of generic sterile injectables is quality manufacturing problems, “the root cause is widely acknowledged to be low prices,” explained Allan Coukell, senior vice president for public policy at Civica Rx in Petersburg, Virginia.

With prices so low, manufacturers are simply not incentivized to invest in quality, witnesses agreed.

One solution is to pay more for the products, said Julie Gralow, MD, chief medical officer, and executive vice president of the American Society of Clinical Oncology. In exchange, the U.S. will see improved resiliency of the supply chain and higher-quality manufacturing, she argued.

The U.S. relies heavily on foreign manufacturing, noted Stephen Schondelmeyer, PharmD, PhD, director of the PRIME Institute at the University of Minnesota College of Pharmacy in Minneapolis.

He said that 45% of finished dosage forms of medications and as much as 60% of active ingredients in medications taken by Americans are made in either China or India.

“We don’t rely on other countries to make the bullets when we fight wars, especially [not] our sworn enemies,” he added.

For that reason, Schondelmeyer urged Congress to incentivize onshoring or “near-shoring” of manufacturing of essential drugs to countries such as Canada, Mexico, and Guam.

Rep. Mike Kelly (R-Pa.) asked whether there was a way to fix the global supply chain issue — medications being made more cheaply abroad — besides relying on Americans to pay more for a product that is made and sourced in America.

Coukell noted that for certain drugs, like penicillin, it would be unrealistic to expect a U.S. manufacturer to make them, given their low global price. “So, if we want to make it here, it is going to take some government investment to bring those facilities back,” he said.

Rep. David Schweikert (R-Ariz.) raised concerns about the environmental impacts of returning drug manufacturing to the U.S. Many small molecule, combination molecule, and precursor drugs — including some chemotherapies — “produce some really nasty stuff and we need to understand that,” he said.

Asked whether Civica Rx would ever consider making chemotherapy drugs, Coukell said doing so would require a “dedicated facility” because cytotoxic drugs require certain special procedures and handling.

“But it may be in the long run that we say in the U.S., these drugs are too important not to have such a facility,” he added.

In addition to onshoring and near-shoring, witnesses also spoke about the need for greater transparency.

Currently there are about 15 cancer drugs on shortage lists, but such lists provide little information on why or how the drug made it to the list, Gralow said. “You do know if there’s a quality issue, but you don’t know where, when, [and] how long they expect [until] it’ll be fixed.”

The FDA needs authorization to be able to ask companies where they get their active pharmaceutical ingredients, and not just at what sites, but what percentages come from each one, she noted. “I think more transparency around how drugs make it to the list with explanation[s] and estimated time frames could be incredibly helpful.”

Schondelmeyer pointed out that New Zealand has a centralized database called Medsafe and their government requires every product approved for the market to disclose its supply chain. “We need a similar database in the U.S.,” he said.

He also noted that the End Drug Shortages Alliance, a group of industry stakeholders including Civica Rx, has a “rapid response team” that works to uncover the reasons for each drug shortage, so that it can more effectively manage these problems.

While the FDA has been “somewhat cooperative,” the agency isn’t able to share certain information with the team, he added. “If you could find ways to authorize FDA to share with this public-private partnership to address shortages as they’re happening, we could be much more effective in what we do.”

Shannon Firth has been reporting on health policy as MedPage Today’s Washington correspondent since 2014. She is also a member of the site’s Enterprise & Investigative Reporting team.

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