When Stock-outs Bring Death — Why Certain Drugs Remain in Short Supply

Kudos to Bob Ferrari for continuing to feature in-depth coverage of the life sciences and pharmaceutical supply chain on his site, Supply Chain Matters. Even though Bob addresses a range of supply chain and procurement-related topics, his continued investigation of risk and supply disruptions in the pharmaceutical market provide critical and much-needed coverage of a critical topic to keep in the trade and business headlines. In a recent post, Bob covered how two "additional" suppliers of cancer drugs have been forced to cut back on production oweing to "the unplanned shutdown of contract producer" facilities and in response, how the FDA has authorized the "temporary importation of [a] replacement drug."

While such a move may be a temporary boon for drug manufacturers whose products have not gone through the clinical approvals process in the US, Bob references an FDA press release that suggests such activity is actually quite uncommon. To wit, the FDA has noted that the "temporary importation of unapproved foreign drugs is considered in rare cases when there is a shortage of an approved drug that is critical to patients and the shortage cannot be resolved in a timely fashion with FDA-approved drugs." Beyond the approval of alternative and unapproved products for treatment -- which are likely, incidentally, to cause additional headaches on the payer side of the equation, given the limbo the reimbursement limbo the FDA has created for unapproved products -- Bob also references other actions the FDA has taken recently that go beyond its usual activities.

These include "working with other drug producers to free-up additional supplies" as well as issuing "additional guidance to drug manufacturers regarding more detailed requirements for both mandatory and voluntary notifications to the FDA regarding future drug shortages or potential drug shortages." In other words, the FDA appears to be attempting to create a supply risk information clearinghouse of sorts that aims to proactively pinpoint supply vulnerabilities based on pharmaceutical company-provided information. However, as anyone in the supply risk management profession knows, the quality of vendor-provided information, especially when it involves insights extending to lower-tier suppliers, is highly variable.

Perhaps we also need some FDA-imposed guidance -- or maybe even standards -- when it comes to how, when and what types of multi-tier production, inventory and related information are made available. This is a task that potential solutions such as Aravo, e2Open and SAP Supplier InfoNet could collectively begin to tackle together if their IP were tweaked, customized and combined to support multi-tier API and broader direct supply chain pharmaceutical visibility and risk management. This collaboration couldn't come a moment too soon.

- Jason Busch

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