Drug Shortages Predicted to Reach Record Levels

Roxanne Nelson

September 09, 2011

September 9, 2011 — Dealing with a cancer diagnosis is extremely difficult, to say the least. For some patients, the trauma is heightened considerably when they are told that their treatment will be delayed — for an undetermined amount of time.

The reason? The medicine cabinet is empty and the drugs they need are not available.

The United States is facing an unprecedented shortage of drugs, including those used to treat cancer. Although the drug shortage has been ongoing for several years, as previously reported by Medscape Medical News, it is becoming progressively more acute, and more importantly, shows no sign of abating.

In fact, the situation is getting worse in terms of the number of drugs in short supply, explained Michael Link, MD, president of the American Society of Clinical Oncology (ASCO). "Starting at the beginning of the 21st century, there has been a crescendo effect of the number of drugs in short supply," he told Medscape Medical News. "We're on track this year to have a shortage of almost 300 drugs — including cancer drugs."

Most of the drugs are generic and off patent, but there are problems with nongeneric drugs as well.

The impact of a shortage of anticancer drugs is probably worse than for other classes of drugs. "For antibiotics, for example, there are usually — although not always — alternatives," he said. "There is often a work-around.... But when you look at the treatment of leukemia, there are really not that many alternatives," Dr. Link explained. "And for certain types of the disease, the shortage of drugs such as daunorubicin and cytarabine basically make it impossible to treat leukemia in both children and adults."

It really is a matter of life or death to patients.

"That really makes the impact on oncology devastating, he added, "because it really is a matter of life or death to patients."

Other oncologic drugs currently in short supply include vincristine, methotrexate, leucovorin, cisplatin, bleomycin, taxol, doxorubicin, mechlorethamine, busulfan, etoposide, and thiotepa.

Perhaps the most frustrating situation, reported Dr. Link, is the unavailability of potentially curative therapies. "There are different implications among the different patient populations, but for some of these cancers, we have available cures," he said. "We are not just prolonging life."

"That is the most deplorable situation," he said. "We know that we have the wherewithal to cure these diseases, but with drugs unavailable, we can't deliver."

Potentially curative drugs are currently in short supply for leukemia, Hodgkin's disease, non-Hodgkin's lymphoma, testicular cancer, sarcomas of bone and soft tissue, and several childhood cancers.

Short Supply Getting Shorter

In 2004, there was a shortage of 58 drugs, according to the University of Utah Drug Information Service, which monitors drug shortages for the American Society of Health System Pharmacists (ASHP). A record-breaking 211 medications became scarce in 2010, which was triple the number recorded 4 years earlier. The University of Utah has predicted that more than 360 agents will reach shortage levels by the end of this year, the highest count in history.

A survey released in July by the American Hospital Association (AHA) reported that 99.5% of hospitals had experienced 1 or more drug shortage in the previous 6 months, and nearly half of the hospitals reported 21 or more drug shortages. These shortages occurred in all treatment categories, and 3 of 4 hospitals reported rationing or implementing restrictions for drugs in short supply.

Delays in patient treatment were reported by 82% of hospitals in the survey, and more than half stated that they were not always able to provide the patient with the recommended treatment.

Costs to the System

The vast majority of all types of hospitals in the AHA survey reported increased drug costs as a result of shortages, and most were buying more expensive alternative drugs from other sources.

In addition, there are indirect costs to the healthcare system. A study released by ASHP, which was conducted in partnership with the University of Michigan Health System, showed that labor costs associated with managing shortages have an estimated annual impact of $216 million nationally (Am J Health Syst Pharm. 2011;68:e13-21).

"Pharmacists reported that it is taking up their time," explained Joseph Hill, director of federal legislative affairs at ASHP. "They are scrambling for products and spending a lot of time on the phone talking to other hospitals, the FDA [US Food and Drug Administration], or wherever — trying to locate drugs."

The survey also found that more than 90% of respondents agree that drug shortages are associated with more burden and higher costs than 2 years ago. In addition, one third reported that the reallocation of existing staff, including from patient care duties, to allow time to focus on managing shortages was common.

For cancer drugs, Dr. Link noted that the most likely impact is being felt in community practice. "They do not have ability to stock up on drugs; large cancer centers and institutions are in a better position to do that," he said. "They also can work with multiple distributors, which is usually not the case for community practice. The overwhelming number of cancer patients are treated in the community, and they are feeling this shortage the most — in terms of cost and availability."

Drivers of the Shortage

There isn't just 1 driver of the drug shortage; in fact, it is complicated by multiple issues, said Mr. Hill.

"One of the main drivers is quality problems in the manufacturing sector," he told Medscape Medical News. "The majority of these shortages are in the area of older sterile generic injectables, and the manufacture of these products is a highly complex process."

These products need to be evaluated for quality and integrity, and oversight has become a lot more rigorous and technical than in days past, Mr. Hill noted.

Companies [have] little incentive to keep making these drugs.

Dr. Link pointed out that not only is the manufacturing of these injectables complex, but that they are also costly to make, with little profit to show for it. "That gives companies little incentive to keep making these drugs," he said.

Another driver is consolidation within the industry itself. "We have seen company mergers, which means that there are fewer manufacturers," Mr. Hill said. " I'm not sure how much of a problem this is, but about 80% of the raw materials are coming from foreign sources. The FDA's reach doesn't extend into India and China, so it is worth exploring how we can secure better quality raw materials."

Mr. Hill acknowledged that such a plan would be difficult to put into practice, but is still worth considering.

Faulty Laws of Supply and Demand?

The irony is that the cancer drugs in short supply are all older, curative, and inexpensive drugs, with some costing as little as $3 a dose, writes Ezekiel J. Emanuel, MD, an oncologist and former White House adviser, in a New York Times opinion piece.

"The sad fact is, there are plenty of newer brand-name cancer drugs that do not cure anyone, but just extend life for a few months, at costs of up to $90,000 per patient," notes Dr. Emanuel, who is now a professor of medical ethics and health policy at the University of Pennsylvania in Philadelphia. Most of the older drugs in short supply have no substitutes; in some cases, physicians are being forced to replace these with brand-name agents, at more than 100 times the cost.

He points out that if the laws of supply and demand were in proper working order, a drug shortage would cause a rise in prices. This, in turn, would induce other manufacturers to fill the gap. "But such laws do not really apply to cancer drugs," he says, adding that this is primarily the result of an unintended consequence of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, which indirectly restricts prices from increasing by more than 6% every 6 months.

After a cancer drug goes generic, prices can drop by as much as 90% during the first 2 or 3 years as manufacturers compete for market share. If a shortage develops, prices should be able to increase again to attract more manufacturers, explains Dr. Emanuel.

But the 2003 Act effectively limits drug-price increases, preventing this scenario from occurring. Low profit margins put manufacturers in a difficult conundrum. They can either lose money producing a lifesaving chemotherapeutic agent, or switch their limited production capacity to a more lucrative drug.

"You don't have to be a cynical capitalist to see that the long-term solution is to make the production of generic cancer drugs more profitable," he writes. "Most of Europe, where brand-name drugs are cheaper than in the United States while generics are slightly more expensive, has no shortage of these cancer drugs."

Gray-Market Vendors

The emergence of so-called "gray-market" vendors has been a disturbing trend as the shortage of essential drugs continues. Gray-market vendors, through a supply channel that is unofficial, unauthorized, or unintended by the original manufacturer, offer drugs for sale at exorbitant mark-ups; in some cases, the products that are being offered are counterfeit, stolen, ineffective, or unsafe.

Premier Healthcare Alliance, an alliance of more than 2500 American hospitals and 75,000-plus other healthcare sites, conducted an analysis in April of the penetration of gray-market vendors. They surveyed all of their acute-care membership, requesting examples of unauthorized offers to sell products in short supply. During a 2-week period at the beginning of 2011, there were 1745 examples of gray-market offers recorded from 42 acute-care hospitals, and all of the products offered were either manufacturer back-ordered or unavailable. A total of 18 gray-market vendors were recorded.

The survey data showed that 96% of the drugs (n = 611) offered were at least double the normal price, 45% (n = 288) were at least 10 times the normal cost, and 27% (n = 171) were at least 20 times the cost.

The average mark-up was 650%, but higher prices were seen for drugs needed in critical-care areas, including oncology. The mark-ups were exorbitant for several drugs: leucovorin was marked up 3170% and dexamethasone 4 mg injectable was marked up 3857%. The highest mark up — for labetalol, used in cardiology — was 4533%.

Solutions in Sight?

At the current time, reporting drug shortages is voluntary. The FDA does not require manufacturers to report information about shortages to them, nor do they require that the reasons for shortages or the expected duration of shortages be reported.

Several healthcare organizations, including ASCO, ASHP, the AHA, the Institute for Safe Medication Practices, and the American Society of Anesthesiologists, have formed a coalition and are working to resolve the ongoing crisis. They convened a Drug Shortages Summit in November 2010, and invited representatives from the pharmaceutical chain manufacturers, supply chain companies, and the FDA.

They are also advocating for a number of legislative and regulatory actions to help address the crisis, including the establishment of an "early warning system" to help avert or mitigate drugs shortages. According to the FDA, in 2010, 38 shortages were prevented when they had early warning information from manufacturers.

Other actions include removing obstacles and allowing the FDA to streamline the approval of drugs in short supply, improving communication among stakeholders, and exploring incentives to encourage drug manufacturers to stay in, enter, or re-enter the market.

Pending federal legislation could help ensure that the FDA is given advance warning of a shortage. Two bills have been introduced this year — one in the Senate and the other in the House of Representatives (Senate 296; House 2245). The Senate bill (the Preserving Access to Life-Saving Medications Act) was introduced by Sens. Amy Klobuchar (D-Minnesota) and Bob Casey (D-Pennsylvania).

In a statement, Otis W. Brawley, MD, chief medical officer at the American Cancer Society, explained that this pending legislation would require a prescription drug manufacturer to notify the FDA "of a discontinuance, interruption, or other adjustment of the manufacture of a drug that would likely result in its shortage."

More specifically, the legislation requires that 6 months be given for any discontinuance or planned interruption or adjustment in manufacturing, and that notice be given as soon as practicable after becoming aware that these interruptions/adjustments will take place.

"Advanced notification to the FDA will enable them to better track and manage drug shortage issues and will allow the government, business, providers, and the public to more systematically analyze and understand the causes and develop appropriate solutions to minimize shortages in the future," said Dr. Brawley.


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