Drug Shortages in the U.S. – A Serious Issue with No End in Sight

Drug shortages in the U.S. have been prevalent for years. Although there have been attempts to mitigate the issue, it’s still a serious problem that has only gotten worse over time. In this post we explore some of the causes/effects of drug shortages and what is currently being done to combat the problem. We also present a way to better manage shortage items in your healthcare institution.

According to an article in Manufacturing.net, there are approximately 265 drugs experiencing a shortage in the U.S. This represents an increase of 74% over the last five years. Factors thought to contribute to drug shortages are:

  • Manufacturing delays including recalls
  • Not enough production capacity or raw materials
  • Long and involved FDA approval process for new drugs, averaging 12 years
  • Spike in demand when a disease breaks out
  • Not enough alternative medications due to a decreasing number of pharmaceutical companies in the U.S.

One of the reasons this issue has been so difficult to resolve is about half of the shortages are attributed to unknown causes.

Effects on Hospitals, Physicians and Patients

Drug shortages affect both physicians and patients, leading to:

  • Patients having to travel long distances to get their medications
  • Doctors not as freely prescribing those meds, even to patients with serious illnesses

The shortage is also causing additional expense to hospitals, upwards of $230 million a year, as they try to find alternative treatments. Unfortunately, these alternatives do not always yield the same efficacy, leading to lower cure rates and sometimes death.

As with most supply/demand situations, the shortage is causing the cost of these drugs to rise. These higher prices have resulted in increased demand for less expensive generic drugs, contributing to a shortage in that area as well.

In addition, some institutions choose to deal with gray market companies which purchase shortage drugs are bought from wholesalers and pharmacy licensees. The drugs are resold several times before they are purchased by a hospital at exorbitant prices. This is another less than desirable option as it presents patient safety concerns. Providers cannot be certain of the authenticity of gray market drugs, nor the integrity, since, for example, the drugs may not have been properly stored.

What Is Being Done?

The FDA plays a role in stopping shortages but can’t control all the drugs in short supply. To help combat pricing issues, they’re now required to alert the Justice Department to drug shortages so manufacturers do not stockpile those drugs or spike their prices. Additionally, in 2012 the FDA started requiring drug makers to give them earlier notice about potential shortages in order to alert healthcare professionals.

The commitment and cost to produce drugs are thought to be major impediments to creating alternatives to drugs consistently in short supply. Some feel that the extremely high cost to invent a compound and take it through clinical trials, along with the fact that only 1 in 5,000 new drugs makes it to market, is discouraging the larger pharmaceutical companies from taking risks. If there was a way to guarantee that pharmaceutical companies would recoup their investments, it could make them less risk averse. But, as of now, there are no such programs in place.

How Pandora Analytics Helps Pharmacy Manage Shortages

To aid pharmacy in managing shortage items, Omnicell’s Pandora Financials analytics application includes a feed to the ASHP drug shortages database, which provides real-time information as shortages are posted by the manufacturer. The software also includes an Item Locator function that lets you easily see where inventory is located across the facility for a given item, group of items, or specific locations (e.g. central pharmacy, OR, nursing units).

Combining these two tools can help pharmacy substantially cut the amount of time spent on inventory management of shortage items. Stormont-Vail HealthCare in Kansas has reduced shortage item tracking from hours to minutes. “We estimate a time savings of 20 minutes daily for each item we track with this feature,” said Jennifer Dunham, PharmD, Medication Safety Coordinator.

The fact that drug shortages exist and present a dangerous problem for both healthcare professionals and patients is well-known. Although steps are being taken, there’s still a long way to go to tackle this serious issue.

Related Articles:

California Healthline


Wall Street Journal

National Association of Boards of Pharmacy

Read about additional ways to manage drug shortages in our previous post.

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