A lack of transparency in the US pharmaceutical supply chain has limited the government's ability to predict and address the nation's rising number of critical drug shortages, according to a new report from the Senate Committee on Homeland Security and Governmental Affairs.
In today's report, the committee noted that the shortages, which peaked at 295 at the end of 2022, include both prescription and over-the-counter drugs and range from those used in hospital emergency departments to those bought at community pharmacies to relieve children's cold and flu symptoms.
"Neither the federal government nor industry has end-to-end visibility of the pharmaceutical supply chain—from the key starting materials, APIs [active pharmaceutical ingredients], finished dosage and various other manufacturers that are 'upstream'—to the 'downstream' suppliers, which include purchasers and providers," the committee said.
The report is a follow-up to one released in 2019, just months before the COVID-19 pandemic further ravaged supply chains, from the same committee headed by Sen. Gary Peters, D-Mich.
Neither the federal government nor industry has end-to-end visibility of the pharmaceutical supply chain—from the key starting materials, APIs, finished dosage and various other manufacturers that are 'upstream'—to the 'downstream' suppliers, which include purchasers and providers.
"Drug shortages are not new and have been reported for more than 25 years, since 1995 or before," said Stephen Schondelmeyer, PharmD, PhD, director of the Resilient Drug Supply Project at the University of Minnesota's Center for Infectious Disease Research and Policy (CIDRAP), publisher of CIDRAP News. Schondelmeyer testified before this Senate committee in May 2021.
Government lacks list of single-source drugs
In addition to a lack of visibility into the supply chain, economic causes and continued US overreliance on foreign and geographically concentrated sources for drugs and their raw materials can all contribute to supply scarcity.
"These shortages have cascading effects on patient care, causing delays in treatment, increasing the risk of medication errors, and requiring the use of less effective alternative treatments," the committee wrote. "Hospitals have also experienced increased costs, medication waste, and limited staffing capacity to address and remedy shortages."
The Food and Drug Administration (FDA) averted a record number of medication shortages in 2021, but substantial gaps remain in supply chain visibility and domestic manufacturing of critical drugs.
These shortages have cascading effects on patient care, causing delays in treatment, increasing the risk of medication errors, and requiring the use of less effective alternative treatments.
For example, the Administration for Strategic Preparedness and Response (ASPR) estimates that up to 95% of generic sterile injectable medications used in critical care depend on the sourcing of key raw materials from China or India. From 2010 to 2015, the number of Chinese-based API makers that registered with the FDA more than doubled, from 188 to 445, according to the report.
The percentage of critical medications with fewer than three makers or which rely on a single API source is unknown, because the FDA and Department of Defense (DoD) lack a list of these drugs, instead relying on the commercial market for information.
While some generic drugs may appear to have more than one supplier, they may actually rely on the same API source or manufacturer, the committee noted. "As a result, the universe of actual suppliers for a particular drug may be much smaller than it appears, increasing the risk of shortage if that API source or manufacturer withdraws supply," the authors wrote.
Key findings on drug supply chain
- Medication shortages are increasing and lasting longer. From 2021 to 2022, new shortages rose by nearly 30%, with the average shortage lasting 1.5 years. More than 15 critical drugs, however, have been scarce for more than 10 years.
- Currently, drug manufacturers aren't required to report increased demand or export limitations for critical drugs to the FDA. Nor are group purchasing organizations (GPOs) or distributors mandated to report decreases in hospital fill rates.
- The FDA does maintain files on raw ingredients; however, the data aren't provided or stored in a format that could increase supply chain visibility. "The FDA acknowledged that it has been unable to use this data to conduct analyses or predictive modeling because the information is 'unstructured' and 'buried in PDFs within individual drug applications.'"
- The FDA doesn't have the authority to recall most drug products, instead relying on voluntary recalls of potentially unsafe products.
The committee called for Congress, the Executive Branch, academia, and industry to collaborate in securing supply chain visibility to identify vulnerabilities, invest in quality systems and advanced-manufacturing technology, and ensure supplier diversification through strategic onshoring of critical generic drugs that are regularly in shortage.
"A comprehensive drug supply map for the sources of US drug products and the key steps in their production is essential to ensuring that Americans have access to a resilient drug supply," Schondelmeyer said.
- Academia and industry should work together to create workforce education programs that bridge the gap between research and development and commercialization. "The federal government should also explore opportunities to engage in long-term contracts with diverse suppliers of critical generic drugs," the report said.
- Congress should require the US Department of Health and Human Services (HHS), the DoD, and the Department of Homeland Security to regularly perform joint risk assessments of the drug supply chain and cybersecurity threats. "The federal government, in coordination with industry partners should also regularly update the Essential Medicines list and use that as a guide for investing in critical drug products in the US," the committee wrote.
- Require manufacturers of critical drugs to report rising demand and export limitations to the FDA and mandate that GPOs and distributors report low hospital fill rates.
- The FDA should act to make its data on key raw materials more usable and to document how it will use manufacturer volume data to identify supply chain risks and predict shortages.
- The federal government should better guide integration of data sharing between agencies and industry through a single project to map the end-to-end supply chain, using digital technologies to routinely perform predictive analyses and identify susceptibilities.
- Congress should give the FDA the authority to recall all potentially unsafe drugs.
The federal government, in coordination with industry partners should also regularly update the Essential Medicines list and use that as a guide for investing in critical drug products in the US.
"Until the federal government and industry strengthen efforts to jointly assess and address their underlying causes, drug shortages will remain a consistent health and national security risk," the report concluded.
Schondelmeyer noted that Americans depend on a safe, accessible, and affordable drug supply for both personal and public health. "The drug supply chain is critical infrastructure for the health and wellbeing of the entire country, as well as the world," he said.