Executive Order Aims to Cure Drug Shortages

By Jennifer M. Thomas –

President Obama issued an Executive Order earlier this week to address the growing issue of critical drug shortages – the first Executive Order to directly affect FDA operations since 1985.   In a coordinated move, FDA also released its report: "A Review of FDA’s Approach to Medical Product Shortages."

According to FDA and the White House, the number of prescription drug shortages nearly tripled from 2005 to 2010, going from 61 reported shortages in 2005 to 178 shortages in 2010.  Some estimates put the number of drug shortages at 180 for the first ten months of 2011 alone—others suggest that number could be as high as 213.  Among the medicines that have been reported in short supply this year are drugs used to treat childhood leukemia, breast cancer, and colon cancer, as well as anesthetics, and antibiotics.  When a vital medicine is in short supply, doctors are forced to reserve supplies for only patients in the direst need, leaving others to go without or to use a less preferred option if one is available.  Moreover, drug shortages result in exponentially higher drug prices, and may force patients to switch medicines mid-regimen, potentially reducing the effectiveness of treatment. Finally, drug shortages can delay clinical trials for new, experimental treatments if the comparator or “control” group in the experiment is receiving an approved drug in short supply. 

While it is easy to recognize the public health concerns raised by drug shortages, identifying the various causes and solutions has proven to be more difficult.   FDA cites a major reason for drug shortages as “quality/manufacturing issues.”  However, the agency also lists production delays and discontinuation of older less-profitable drugs as reasons for shortages.  Some commenters argue that the increased number of products and raw materials coming from plants in China and India results in uncertain supply, particularly if FDA finds quality issues at such foreign facilities.  Others cite the simple operation of the free market as the cause of shortages—prices for older medications are low until they are in short supply.   But even higher prices triggered by a shortage may not cause manufacturers to make the investments necessary to overcome the practical and regulatory hurdles to increased production. 

The issue has caught Congress’ attention; legislators introduced a rare bipartisan bill in the Senate and House in February and June, 2011, respectively, to try to stymie the growing number of shortages (“Preserving Access to Life-Saving Medications Act of 2011,” S. 296, H.R. 2245).  Importantly, the bill would expand FDA’s authority to require advance notification of drug discontinuations under 21 U.S.C. § 356c to include all drug and biologic manufacturers, and to require those manufacturers to report circumstances that may result in a drug discontinuation or interruption of production—such as a merger, a change in the supply of one or more raw materials, etc.  Among other affirmative requirements, the proposed bill requires FDA to conduct an analysis of drugs that may be vulnerable to a shortage, and to publish the notifications it receives under § 356c online.

The “Preserving Access to Life-Saving Medications Act of 2011” remains pending in committee.  So the White House has attempted to move forward without Congressional action – using an Executive Order to direct FDA to do more to curb drug shortages under the agency’s current statutory authority.  Specifically, the Executive Order directs FDA to:

(1) Use its existing authority under 21 U.S.C. 356c, which requires sole-source drug manufacturers to notify FDA in advance of discontinuances that could lead to shortages of certain critical drugs;

(2) Expedite its regulatory reviews of new drug suppliers, manufacturing sites, and manufacturing changes where such expedited review would help to avoid or mitigate an existing or potential drug shortage; and

(3) Report drug stockpiling and over-charging for scarce drugs to the Department of Justice.

It is unclear whether the provisions of this Executive Order can have any significant independent effect on the frequency of drug shortages.  Currently, § 356c is limited to sole-source manufacturer discontinuations of medically necessary drugs, so FDA can not require advance notification of other manufacturers, in other circumstances besides discontinuation, or about other types of drug products.  Moreover, notification of an impending shortage does not necessarily help the manufacturer that is unable to increase production, sometimes for reasons outside of its control.  FDA would still have to approve new suppliers, manufacturing sites, or changes for drugs vulnerable to shortages, and those actions seem limited more by scarce review resources than by failure to allocate those resources appropriately.  Regardless of the Order’s direct effects, however, it may be the impetus Congress needs to finally take action.