Drug Shortages are National Security Risk: Califf
FDA commissioner Robert Califf says he and the agency are spending way too much time on addressing continuing drug shortages, to the tune of about 200 shortages, or what he calls “plugging holes,” each year. “I did not come back to FDA to spend all my time on the supply chain, but that’s what’s happened, and I feel like I know a lot about it and I'm pretty fired up to do something about it,” Califf told an 8/22 Alliance for a Stronger FDA webinar. Plugging over 200 holes a year is not good for society, Califf continued, adding that it’s a huge national security risk and better information from industry is needed to get a more complete picture of what's in the supply chain so the agency can help respond.
While FDA has become pretty good at plugging holes when a shortage occurs, the fundamental problem, Califf said, boils down to drug pricing — innovator drugs are priced too high, and generics are priced too low. Of course, Califf acknowledged that pricing is not in “FDA’s lane,” but he said that some generics are priced below their cost and this is creating a big problem.
“What I mean by that is that the price has been driven down below the cost of manufacturing and distributing the drug,” he told the Alliance. The generic drug industry is continuing to leave the U.S. because it's not viable to run their business, he said. “And even in India, companies are saying they can’t invest in the manufacturing because there's not enough of a margin, if any, to attract investors to go into it. And that's been driven by the success of the generic laws, which I'm a big fan of.” Currently over 90% of prescriptions are generics, he noted.
Califf said it’s time for a “modification in the market so that the industry can be sustained.” There’s not a balance of where the market responds to shortages by fixing the pricing issue that has caused some manufacturers to stop making certain unprofitable drugs, Califf said, adding that some of the profits are needed to keep facilities up to date. “That’s not happening and that needs to be fixed, but it’s not the FDA’s job to fix that… So, I think like the banking industry, ultimately over time we’re going to need to have a way for a government agency to delve in and do stress testing, and when there’s an impending shortage [to] intervene,” he said.
Additionally, Califf briefly mentioned that FDA is on the “road to more transparency” in two arenas — inspections and the quality management framework. He said FDA soon will make inspections of facilities more available on the Internet and easier to find. Regarding the quality management framework, Califf was vague about the transparency details, but he said it had to do with the “elements of the supply chain that are doing the manufacturing” and whether they have a “quality system and diversification of their own supply chains, redundancy in the supply chain, etc.”