Obama Issued Executive Order To Deal With Prescription Drug Shortages That “Pose A Serious And Growing Threat To Public Health”

Obama Executive Order Noted That Drug Shortages Are “Becoming More Severe As Well As More Frequent.” From Obama's October 31 executive order titled “Reducing Prescription Drug Shortages”:

Shortages of pharmaceutical drugs pose a serious and growing threat to public health. While a very small number of drugs in the United States experience a shortage in any given year, the number of prescription drug shortages in the United States nearly tripled between 2005 and 2010, and shortages are becoming more severe as well as more frequent. The affected medicines include cancer treatments, anesthesia drugs, and other drugs that are critical to the treatment and prevention of serious diseases and life threatening conditions.

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As part of my Administration's broader effort to work with manufacturers, health care providers, and other stakeholders to prevent drug shortages, this order directs the FDA to take steps that will help to prevent and reduce current and future disruptions in the supply of lifesaving medicines. [WhiteHouse.gov, 10/31/11]

Malkin And Napolitano Attack Obama For His Attempt To Respond To Prescription Drug Shortages

Malkin: Obama's Executive Order Is Response To An “Irresistibly Exploitable Policy Issue” That Promises To “Do More Harm Than Good.” In a November 4 column on her website, Michelle Malkin attacked President Obama's executive order addressing prescription drug shortages. From her blog:

President Obama couldn't wait to trample over the legislative process again. This week, he issued his 98th executive order on an irresistibly exploitatable policy issue: prescription drug shortages. Soon, “One a Day” won't just be a multivitamin. It'll be the rate of White House administrative fiats.

Federal officials darkly suggest that selfish industry “stockpiling” is endangering Americans' lives. “If we find out that prices are being driven up because shortages are being made worse by manipulations of companies or distributors,” the White House further threatened, “agencies will be empowered to stop those practices. And the FDA and the Department of Justice will be investigating any kinds of abuses that would lead to drug shortages.”

As usual, the underlying reasons for these marketplace conditions are gobsmackingly complicated. As usual, a significant portion of the fault lies with the government -- not evil corporate “abuses.” And as usual, Obama's unilaterally imposed “solutions” promise to do more harm than good. [MichelleMalkin.com, 11/4/11]

Napolitano: “Can The Government Fix A Problem It Created In The First Place?” On an October 31 edition of Fox Businesses' Freedom Watch, host Andrew Napolitano ran a segment with Fox contributor Dr. Marc Siegel that pinned the blame for prescription drug shortages on the Food and Drug Administration:

ANDREW NAPOLITANO: Alright the federal government is never happy, its regulations have caused many a drug shortage in the United States. Tonight the president attempted to right that wrong with an executive order he signed. Can the government fix a problem it created in the first place? Here to discuss Fox News medical contributor and my good friend Dr. Marc Siegel, Dr. Siegel welcome here.

MARC SIEGEL: Hi judge

NAPOLITANO: Ok. So what is the president trying to fix? An economic shortage in drugs caused by the involvement of the Food and Drug Administration he thinks can somehow be absolved by him merely ordering that more drugs be made available?

SIEGEL: You already said what the problem is. This problem occurred because we have a shortage of raw materials because we're getting them from oversees, 80 percent of the time.

NAPOLITANO: Raw materials to make drugs.

SIEGEL: To make prescription drugs. We have one-hundred and eighty drugs, lifesaving drugs that are short. And the biggest problem with them, outside of the shortage of raw materials is that most of them are generic, so there's not enough profit margin, and there's the FDA, riding in on the backs of the drug companies trying to ensure sterility of the medications. Now I think that's a very serious medical matter, but the drugs are overregulated. So judge, how's the FDA going to now solve the problem it created, as you pointed out, by now saying we want six months' notice when you're going to have a shortage, but what are they going to do with the six months?

NAPOLITANO: We want six months' notice when you're going to have a shortage. Is it knowable in advance when a shortage of drugs is going to arise?

SIEGEL: Oftentimes it's not. Because the demand, it goes on a day-by-day basis. We're talking heart drugs, we're talking steroids, we're talking antibiotics, we're talking chemotherapy. [Fox Business, Freedom Watch, 10/31/11]

Napolitano: “Why Won't The FDA Let Me Take What You Prescribe For Me If You And I Have Decided That It Is Safe And It Might Be Effective?” During the same segment of Freedom Watch, Napolitano suggested that the FDA should not be allowed to regulate prescription drugs at all:

NAPOLITANO: Why won't the FDA let me take what you prescribe for me if you and I have decided that it is safe and it might be effective? Suppose I'm on death's door. Why won't they let me take a last shot at something, rather than going through their 10 years of testing by the end of which the patient -- the hypothetical me in this case -- would be dead?

SIEGEL: I completely agree with that. They need to loosen the regulations. That's the reason that the drug companies -- now we're talking chemotherapy -- are running for the hills. They're not making the profits they need, because as they get towards the end of the patent, these drugs -- and several of them have hit the news lately -- they become unprofitable. And it's because the FDA is still regulating them and costing the drug companies a fortune, but they know they're about to become generic, and they're not get the profit. [Fox Business, Freedom Watch, 10/31/11]

The Executive Order Specifically Requires The FDA To “Expedite Its Regulatory Reviews” In Cases Of Drug Shortages

Obama Ordered The FDA To “Expedite Its Regulatory Reviews” When Necessary To “Avoid Or Mitigate Existing Or Potential Drug Shortages.” Napolitano, Siegel, and Malkin all failed to mention that Obama ordered the FDA to “expedite its regulatory reviews” in cases where such actions would help deal with drug shortages. From Obama's October 31 executive order, titled “Reducing Prescription Drug Shortages”:

To the extent practicable, and consistent with its statutory responsibility to ensure the safety and effectiveness of the drug supply, the FDA shall take steps to expand its current efforts to expedite its regulatory reviews, including reviews of new drug suppliers, manufacturing sites, and manufacturing changes, whenever it determines that expedited review would help to avoid or mitigate existing or potential drug shortages. In prioritizing and allocating its limited resources, the FDA should consider both the severity of the shortage and the importance of the affected drug to public health. [WhiteHouse.gov, 10/31/11]

Obama Ordered The FDA To “Require Drug Manufacturers To Provide Adequate Advance Notice Of Manufacturing Discontinuances” That Could Lead To Shortages Of Important Drugs. The executive order also required the FDA to “use all appropriate administrative tools” to require drug companies to provide adequate notice when they decided to stop production of an important drug that could be subject to a shortage:

To the extent permitted by law, the FDA shall use all appropriate administrative tools, including its authority to interpret and administer the reporting requirements in 21 U.S.C. 356c, to require drug manufacturers to provide adequate advance notice of manufacturing discontinuances that could lead to shortages of drugs that are life supporting or life sustaining, or that prevent debilitating disease. [WhiteHouse.gov, 10/31/11]

Obama Ordered The FDA To Tell The Justice Department Whenever Drug Companies Are Stockpiling Drugs That Have Shortages Or Are “Sell[ing] Them At Exorbitant Prices.” The executive order also stated:

The FDA shall communicate to the Department of Justice (DOJ) any findings that shortages have led market participants to stockpile the affected drugs or sell them at exorbitant prices. The DOJ shall then determine whether these activities are consistent with applicable law. Based on its determination, DOJ, in coordination with other State and Federal regulatory agencies as appropriate, should undertake whatever enforcement actions, if any, it deems appropriate. [WhiteHouse.gov, 10/31/11]

Analyses Say Manufacturing Problems, Not Regulation, Are Key Drivers Of Prescription Drug Shortages

NERA Economic Consulting On The Potential Causes And Effects Of Drug Shortages: “Manufacturing Causes Were The Most Common Overall” In a January 19 consulting brief titled “An Analysis of Price Effects from Drug Shortages for Independent Pharmacies,” Dr. Graeme Hunter of NERA Economic Consulting pointed to manufacturing problems as the most prevalent driver of shortages. From his analysis:

Table 2 shows the causes of shortages reported in the ASHP database for all products and for oral medications only. Manufacturing causes were the most common overall as well as for oral drugs. Regulatory issues resulted in 15 percent of shortages overall, but were more important for oral drugs. A large share of causes fall into the “other” category, which includes raw material shortages and delays related to mergers and acquisitions.

[NERA, 1/19/2011]

HHS: Shortages Appear To Be “A Consequence Of A Substantial Expansion In The Scope And Volume Of Products Produced By The Industry ... Without A Corresponding Expansion In Manufacturing Capacity.” An issue brief conducted in October by the Department of Health and Human Services Assistant Secretary for Planning and Evaluation analyzed underlying factors that lead to shortages in the prescription drug market. The brief concluded:

The current class-wide shortages in the industry appears to be a consequence of a substantial expansion in the scope and volume of products produced by the industry that has occurred over a short period of time, without a corresponding expansion in manufacturing capacity.

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The structure of the sterile injectable market, the recent expansion in volume and scope, and the consequent very high level of capacity utilization, means that small disruptions to supply - such as may occur because of quality problems - which would otherwise be absorbed through diversion of capacity, can lead to cascading and persistent shortages. Moreover, high rates of capacity utilization may also limit the ability of manufacturers to perform routine maintenance and keep facilities in good order.

Quality problems in manufacturing are linked to a majority (54 percent) of shortages of sterile injectable drugs. Some of the largest manufacturers of sterile injectable drugs have had serious quality problems leading to the temporary voluntary closure or renovations of major production facilities. This means that quality problems that affect an entire plant may result in shortages for many drugs. This temporary closure of a large manufacturing facility can also lead to other facilities being unable to meet the increased demand for the drug due to the lack of excess capacity and the pressure of ramping up supply for multiple drugs in other facilities. [U.S. Department of Health And Human Services, October 2011]

FDA And HHS: “Quality Problems At The Drug Manufacturing Facility Resulting In Disruptions In Supply Were The Leading Cause Of Drug Shortages.” A review of medical product shortages released October 31 by the Food and Drug Administration and the Department of Health and Human Services concluded that quality problems at manufacturing facilitates was the single largest cause of supply disruptions. From the review:

Quality problems at the drug manufacturing facility resulting in disruptions in supply were the leading cause of drug shortages (see Figure 4), accounting for 43% of all shortages, followed by other delays in manufacturing or shipping (15%) and a shortage of the Active Pharmaceutical Ingredient (API; 10%). In general, inspection findings that have been followed by shortages have been serious in nature: glass shards, metal filings, and fungal or other contamination in injectable products that must be sterile and pure to be safe for patients. [Food and Drug Administration, 10/31/11]

• Graph Depicting “Drug Shortages By Primary Reason For Disruption In Production And Supply”:

[Food and Drug Administration, 10/31/11]

Health Care Groups Praised Obama's Executive Order

American Hospital Association: Executive Order “Is Welcome News For Hospitals And The Patients They Care For.” From a November 2 HealthLeaders Media article:

AHA Executive Vice President Rick Pollack said in a prepared statement that the order “comes at a critical time and is welcome news for hospitals and the patients they care for. The number of drug shortages has tripled in the last six years and the shortages are affecting patient care.”

An AHA survey this year found that nearly 100% of hospitals reported a shortage in the past six months, but that most of them rarely -- if ever -- received advance notification of these drug shortages.

“Clinicians need more notice from drug manufacturers so they have time to act to ensure that patient care is not disrupted,” Pollack said. “Hospitals are doing their best to reduce the impact of shortages by increasing inventories, buying alternative drugs and training clinical staff on how to deal with drug shortages.”

While AHA supports the president's order, Pollack says Congress must step up to pass bipartisan legislation that requires drug companies to tell the FDA as soon as possible of interruptions in supply or discontinuations.

“In addition, we believe that obstacles must be removed so that FDA is able to streamline approval of drugs in shortage,” Pollack said. [HealthLeaders Media, 11/2/11]

American Society Of Health-System Pharmacists “Applaud[ed] President Obama” For The Executive Order. From a statement by the American Society of Health-System Pharmacists:

The American Society of Health-System Pharmacists applauds President Obama for today's executive order taking action on the public health crisis of prescription drug shortages. The President's order directs the Food and Drug Administration (FDA) to broaden reporting of potential shortages, expedite regulatory reviews, and increases staffing resources for the FDA's Drug Shortages Program.

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“The President's leadership to address this public health crisis is an encouraging signal that we might fix the problems that are causing patients to go without life-saving drugs,” said Henri R. Manasse, Jr., Ph.D., Sc.D. “ASHP has been working hard to focus public attention on this national health crisis and we applaud President Obama for taking action today.”

The Executive Order reflects actions that ASHP has been advocating for some time, including requiring reporting of expected shortages and attention to the secondary market. “We hope this action today will help Congress move forward with the bipartisan legislation (H.R. 2245 and S. 296) as soon as possible,” said Manasse. ASHP has also been advocating for increased FDA funding to address this and other issues through its work with the Alliance for a Stronger FDA,. “The FDA has been working hard to address drug shortage for some time, but needs more people and more funding to address the broad-based issues that cause drug shortages,” added Manasse. [American Society of Health System Pharmacists, 10/31/11]