Introduction: The Drug Shortage Crisis

Since 2005, Americans have faced increasing shortages of key prescription drugs. The federal Food and Drug Administration reports that between 2005 and 2010 the number of drug shortages rose from 61 to 178 — nearly tripling. The figure leapt to more than 250 in 2011.[1]

This rise broke the positive trend of previous years. The number of shortages had dropped from 103 to 54 from 2001 through 2004.[*]

The proportion of drugs suffering shortages is less than 1 percent of all drugs available in a given year.[2] The shortages, however, are concentrated in a vital category of medicines. According to the FDA, 74 percent of the 178 drugs in short supply in 2010 were sterile “injectable” drugs.[3]

These injectable drugs are used in important treatments for cancer and other diseases. The drugs are not sold in pharmacies, but rather administered by health professionals in doctors’ offices, clinics and hospitals. They differ from the synthetically manufactured, small-molecule drugs usually dispensed as tablets by retail pharmacies in that they are not made from inert chemicals, but from living things, such as bacteria. In their natural state they can be infectious or poisonous. Therefore, manufacturing, storing and distributing these drugs demands significantly greater diligence and vigilance.

More than half the critical drug shortages reported between Jan. 1, 2009, and June 20, 2011, involved generic injectable drugs.[4] This is counterintuitive. A generic medicine is allowed on the market only after patents on the originally invented medicine that the generic copies have expired. Generic drugmakers are usually independent of the drugmakers that invented the drugs (the latter are known as “research-based” drugmakers). Generic drugs should thus be more readily available than patented drugs because competitors are free to market copycat versions, reducing prices.[†]

The IMS Institute for Healthcare Informatics, which has access to a proprietary database of pharmaceutical sales, analyzed the drugs listed as being in short supply by both the FDA and the American Society of Health-System Pharmacists as of Oct. 7, 2011. Remarkably, half of all generic injectable drugs were on the list.[‡]

So while the shortages may not appear important as a share of the entire portfolio of prescription medicines, they are certainly important to this segment. Two-thirds of the drugs were in five disease areas: oncology (cancer), anti-infectives, cardiovascular (heart disease), central nervous system and pain management.[5] Last year, 550,000 cancer patients were treated with at least one of these medicines.6

Health professionals believe these shortages are likely harming patients. Premier Inc., an organization that purchases supplies for a group of health care providers, surveyed 311 pharmacy experts representing 228 hospitals and other providers during the second half of 2010. A full 89 percent reported that they had experienced a shortage that might have caused a safety issue or error in patient care, and 53 percent suggested that this had occurred six or more times. Further, 80 percent experienced a shortage that resulted in a delay or cancellation of a patient-care intervention.[7]

A previous 2010 survey of health care practitioners and pharmacists reported that one-third of respondents observed “near misses” and one-fifth reported adverse patient outcomes due to shortages.[8] Another 2011 survey of managers in 820 hospitals also reported a troubling frequency of drug shortages.[9] Nearly all hospitals – an astonishing 99.5 percent – reported one or more drug shortages in the last six months, and nearly half reported 21 or more.[10] These shortages have also disrupted randomized clinical trials for experimental cancer treatments because the patients assigned to the control groups supposed to receive the standard drugs could not get them.[11]

[*] “Drug Shortages: FDA’s Ability to Respond Should Be Strengthened,” (Government Accountability Office, 2011), 16, (accessed May 17, 2012). The shortage data are voluntarily reported by manufacturers to the FDA when they are unable to produce enough drugs to meet demand. Another source of data for drug shortages is the American Society of Health-System Pharmacists, which collaborates with the University of Utah to gather reports of shortages submitted via a website; see “Drug Shortages: Current Drugs,” (American Society of Health System Pharmacists), (accessed June 5, 2012).

[†] A generic drug producer’s manufacturing processes are subject to strict regulation, however, a point that will be discussed in the main text below.

[‡] “Drug Shortages: A closer look at products, suppliers and volume volatility,” (IMS Institute for Healthcare Informatics, November 2011), 4. Because the analysis combined two lists that use different sources, the intersection of both comprised only 168 products.