Trade & Channel Strategies 2024: A Deep Dive into Drug Shortages

Trade & Channel Strategies' “Actions Needed to Mitigate and Prevent Drug Shortages" session

Another session along Trade & Channel Strategies’ supply chain, distribution, and logistics track focused on “Actions Needed to Mitigate and Prevent Drug Shortages.” The presentation by Amy Sonderman, senior director of US advocacy and stakeholder engagement, US Pharmacopeia (USP), aimed to understand the sources of shortages; offer approaches to holistic solutions; and find ways how that pharma supply chain stakeholders can work with Congress and one another to help mitigate and prevent shortages in the United States.

USP, an independent, scientific nonprofit organization focused on building trust in the supply of safe, quality medicines, strives to support the entire supply chain in this regard. The company determined four factors that are directly correlated with shortages:

1. Low prices
2. Manufacturing complexity
3. Production concentration
4. Quality concerns

In fact, the organization publishes an annual “Drug Shortage Report” featuring drug products that are listed on the FDA’s drug shortages database. Among various elements, medications were mapped based on location, units, and prices with the help of its Medicine Supply Map, but it’s important to note that biologic shortages tracked by the Center for Biologics Evaluation and Research were excluded from this report.

According to USP research, 2023 was a year that saw the highest number of shortages in a decade, with 125 of them being monitored by the FDA. That same year, the average drug shortage duration was over three years, and there are currently six shortages that have lasted a decade or longer.

So which drugs have the highest shortage risk? Perhaps it makes sense that low-priced meds would be the ones, demonstrated by medications in the injectable and oral solid categories. A couple of eye-opening statistics include that sterile injectable meds that are in shortage cause 8.5 times less than those that are currently not in a shortage—to put it into perspective, imagine $46/unit compared to $392/unit. As for solid orals in shortage, they cost five times less than those not in shortage, which would be $3.40/unit compared to $17.50/unit.

These types of factors are contributing to discontinuations of these products, a concept that increased by 40% last year. Sonderman put it into perspective by offering a real-life example.

“Think about that—if you have a child who needs ADHD medicine and your pediatrician prescribed it, you go to the pharmacy and they don't have it. You then spend hours as a caregiver calling around to pharmacies. The pediatrician has to then spend hours calling around to the pharmacy. The pharmacist, who should be assisting other patients, is spending hours calling wholesalers, calling hospitals. This is a huge waste of resources. It's a huge time stop for the healthcare industry to just try to mitigate one shortage.”

This is why, Sonderman added, evidence-based reforms are critical. This involves identifying risks with an early warning system; incentivizing resilience by rewarding manufacturers for investing in quality; diversifying manufacturing with an incentive for expanding their geography; and bolstering capacity with the help of advanced manufacturing technologies that can improve manufacturing efficiency, while lowering production costs.

From a regulatory perspective, in order to strengthen the supply chain and reduce these shortages, organized action is needed from Congress, administration, and regulators. Beyond that, there is also a need for collaboration among the industry, its thought leaders, and patient advocacy.

Reference

Sonderman A. Actions Needed to Mitigate and Prevent Drug Shortages. December 11, 2024. Trade & Channel Strategies, Philadelphia. https://informaconnect.com/trade-channel/