While the availability of critical prescription drugs has improved slightly since record shortages occurred earlier this year, persistent shortfalls continue to plague our health care system and pose an enormous threat to public health.
The AMA continues to lead the fight against drug shortages by stressing the need to diversify pharmaceutical manufacturing processes and making the supply chains supporting those processes more resilient and adaptable.
We also support new and innovative strategies to stabilize the generic drug market, such as exploring government-operated manufacturing of generic drugs that are or have been in short supply, with the goal of reducing our overreliance on a small number of offshore producers. The thin profit margins that surround the manufacture of commonly prescribed generics dissuade investment in their production. This can deepen and prolong shortages when only a single firm or a handful of manufacturers—typically located overseas—are making a given drug.
In my office and even in the operating room, I have seen shortages of commonly used medications that are essential to patient care. In some cases, the available alternatives are not equivalent, and patient care has to be rescheduled, causing inconvenience and potentially affecting outcomes.
In recent years, the five classes of drugs most frequently in short supply are central nervous system drugs, fluids and electrolytes, antimicrobials, chemotherapies and hormones. Shortages in each of these categories put patients and our nation at risk. Shortages of some of the most basic and essential products, such as sterile saline, lidocaine and amoxicillin, have persisted for years—with no end in sight. In addition, the average drug shortage now lasts for more than three years, up from about two years in 2020.
This is unacceptable in a health care system like ours, and the AMA is committed to helping implement new strategies to better protect public health.
Factors driving shortages
The economics of generic drug production are one of three primary issues fueling persistent drug shortages, as identified by the AMA Council on Science and Public Health, along with an ever-evolving prescribing landscape and demand challenges created in part by direct-to-consumer advertising of pharmaceuticals—which has become a $6 billion industry.
The council delivered a comprehensive update of drug shortages (PDF) to the AMA House of Delegates last fall, which also explored potential solutions such as preemptive purchasing and stockpiling. Delegates promptly adopted new policy to combat practices that aggravate the crisis, such as excluding patient-appropriate drugs in adequate supply from approved pharmacy formularies in favor of drugs in short supply. The council will issue an updated report this fall.
Search for solutions
Complex issues such as persistent drug shortages require a comprehensive, multifaceted response. The highly opaque nature of the pharmaceutical supply chain poses problems of its own to first identify the root causes, which are plentiful. The search for solutions is hampered by the fact that the reason behind a particular shortage was unknown, or the manufacturer declined to provide it, for 60% of drug shortages in 2023.
The decadeslong “race to the bottom” in generic drug prices means that buyers—including pharmacy benefit managers (PBMs), group purchasing organizations, wholesalers and health plans—consider cost alone in their purchasing decisions.
Of course, this prompts generic drug manufacturers to lower their prices to maintain or expand their market share. Doing so cuts their margins and increases their financial instability, reduces their ability to refine or expand manufacturing operations, and forces some to close their doors. This yields a highly vulnerable supply chain prone to disruption due to any number of factors.
Concentration in purchasing power also leads to anticompetitive behavior that fuels shortages. The AMA supports the ongoing inquiry by the Federal Trade Commission (FTC) on the influence that pharmacy benefit managers have on both the price and availability of prescription drugs. An FTC interim staff report released in July shows that PBMs make “critical decisions about access to and affordability of life-saving medications without transparency or accountability to the public.”
Drug shortages harm patients and the physicians who care for them, and must be addressed by regulators and policymakers. This reform should begin with far greater transparency of the drug supply chain and all those who operate within it. The AMA remains committed to working cooperatively with all stakeholders to put this critical public health problem behind us.
