The Administration and Congress

President Obama proposes to fix this problem by requiring drugmakers to notify the FDA six months — half a year! — before a shortage occurs. He has already taken steps in this direction. In October 2011, the president issued an executive order recognizing that shortages are becoming more severe and frequent.[58] The order claimed, “[T]he root problems and many of their solutions are outside of the FDA’s control,” but nevertheless demanded that the FDA:

  1. increase the burden on manufacturers to notify the FDA of forthcoming shortages;
  2. expedite the regulatory review of new drug suppliers and facilities;
  3. tell the Department of Justice when it suspects stockpiling or price gouging (“exorbitant prices”).[59]

In February, the FDA issued preliminary guidance explaining how it would execute these new responsibilities. The new guidance appears to push the limits of FDA administrative powers over manufacturers.[60] Current law mandates that only a “sole manufacturer” of drugs that are “(A) life-supporting; (B) life-sustaining; or (C) intended for use in the prevention of a debilitating disease or condition” is required to give the FDA six months’ warning of an impending shortage.[61] The assumption seems to be that if the FDA knows about a potential shortage, it can then fix the problem.

The recent guidance clearly calls upon all the FDA’s considerable powers to motivate manufacturers to report voluntarily all forthcoming shortages. The guidance encourages manufactures to be “over-inclusive” in defining these terms.[62] “Discontinuance,” which used to mean permanently ceasing production, now includes temporary stoppage (if it will disrupt supply).[63] The FDA appears to acknowledge that manufacturers cannot always predict six months in advance and provides for short-term warnings in certain urgent situations.[64]

Legislating this expansion of FDA power by giving the FDA clear authority to demand a six-month notice from all drug makers is a current political priority. As of this writing, the Prescription Drug User Fee Act renewal legislation, which is poised to pass Congress with an overwhelming majority, contains this provision.[*], [65]

Both the president and Congress are influenced by a recent analysis produced by the U.S. Government Accountability Office. The analysis concluded that the FDA does not yet have a systematic way of gathering data on shortages, but rather just maintains individual files that are not reliable, easily retrieved or routinely recorded.[66]

Despite this inability to execute basic record-keeping that can provide useful information, the FDA asserts that early notification, even as narrowly practiced today, has allowed it to respond by expediting review of new products for approval or exercising regulatory flexibility.[67] The FDA asserts that early warnings helped it to mitigate 23 injectable-drug shortages in 2006, and that this increased steadily to 132 in 2010.[68] In February, the FDA asserted that it had prevented 114 shortages just since last October’s executive order.[69] In May 2012, six months after the President’s executive order, the FDA claimed to have prevented 128 shortages in that half year. It also claimed that 42 new drugs were reported in shortage in 2012, versus 90 at the same time in 2011.[70]

These claims of shortages “prevented” have not been independently verified.

[*] This is called the Food and Drug Administration Safety and Innovation Act.