Anatomy of a drug shortage.

A long time has passed since I last gave chemotherapy, but I have not been immune to the news about the drug shortages in the past few years. Therefore, I wanted to explore what was behind the headlines like “U.S. facing cancer drug shortage: Ariz. doctors rationing supplies; FDA allowing India imports” in the February 22nd Arizona Business News (Alltucker, 2012). You may have been more directly involved in the stories behind these headlines. What dilemmas have you faced related to drug shortages? Drug shortages are defined in Tyler (2002) as “a change in the drug supply that has the potential to compromise patient care” (p. 1). Two articles were published in the New England Journal of Medicine describing the multifactorial issues contributing to our current chemotherapy shortages (Chabner, 2011; Gatesman & Smith, 2011). Reasons cited for drug shortages cover the supply chain process (see Figure 1), including raw material supply, manufacturing issues and delays, product modification, market withdrawal, and increased demand (U.S. Food and Drug Administration [FDA], 2012). The cascade of events leading to these shortages has been linked to the 2003 changes in Medicare reimbursement for chemotherapy drugs, the majority of which are delivered in the outpatient or office setting. Prior to 2003, physicians’ offices purchased chemotherapy at 66%–88% of the average wholesale price (AWP), and were reimbursed at 95% (consider AWP the manufacturer-suggested retail price of a car). The resulting profit margin was used to pay for chemotherapy nurses and practice costs associated with chemotherapy administration. Since 2006, Medicare now reimburses at average sales price (ASP) (consider ASP to be the dealer’s invoice for a car), plus a 6% markup to pay for these expenses. For example, the reimbursement for a generic version of a chemotherapy drug may be so low as to not cover practice costs. When a company develops a drug, the right to market the drug is given exclusively as a way to recoup the research and development costs. When that exclusivity period ends (usually around seven years later), others can make generic versions of the drug that usually are much cheaper. Generic manufacturers also may be making business decisions about the financial viability of making generic drugs for sale in the United States. Prior to 2011, no requirement existed for the manufacturer to report a stoppage in production of a drug when such an action occurred. According to Wagner (2011), drug shortages have been steadily rising every year since 2006, but have only recently been receiving media attention. Fiftysix drugs were reported to be in short supply in 2006. That number more than tripled to 178 in 2011. As of February 28, 2012, 110 drugs are listed on the FDA Web site, including at least 14 commonly used cancer chemotherapy drugs (e.g., bleomycin, cisplatin, daunorubicin, doxorubicin, doxorubicin liposomal, etoposide, fluorouracil, leucovorin calcium, leucovorin, methotrexate, mitomycin, mustargen, paclitaxel, thiotepa, vinblastine) and supportive care drugs. You can find more information and current drug shortage listings by accessing www.fda .gov/Drugs/DrugSafety/DrugShortages/ default.htm. In the fall of 2011, the Oncology Nursing Society (ONS) and the National Coalition for Cancer Research provided Congressional testimony about the impact of drug shortages on patient care and clinical research. On October 31, 2011, President Obama issued Executive Order 13588—Reducing Prescription Drug Shortages (WhiteHouse.gov, 2011), which directed the FDA “to take steps that will help to prevent and reduce current and future disruptions in the supply of lifesaving medicines” (p. 1), require a According to the U.S. Food and Drug Administration (FDA), market withdrawals are a firm’s removal or correction of a distributed product that involves a minor violation that would not be subject to legal action by the FDA or which involves no violation. FIGURE 1. Drug Supply Change From Supplier to Patient Note. From U.S. Food and Drug Administration, 2011. Suppliers Manufacturer Wholesale Distributor (primary) Pharmacy or Hospital Patient