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Obama Issues Order to Resolve Drug Shortages

In November, President Obama initiated an executive order to tackle the growing shortages of medicines used to treat some forms of cancer and other diseases.

BY Jeanne Erdmann
PUBLISHED December 21, 2011

In November, President Obama initiated an executive order to tackle the growing shortages of medicines used to treat some forms of cancer and other diseases. The order instructs the Food and Drug Administration to hasten applications for companies to produce these drugs, to report on potential shortages of other drugs and to supply the Justice Department with evidence of companies that price gouge.

The order comes after months of disagreements in Congress on how to settle this issue. More than 22 chemotherapy drugs, about 35 to 40 percent of the total cancer drugs, are in short supply. Injectable generics are especially scarce. These shortages don’t count supportive care medications used in oncology, such as injectable anti-nausea drugs.

While there are many reasons for these shortages, a major factor includes regulatory and manufacturing issues. In 2010, two manufacturing plants that produce injectable generics voluntarily closed to correct quality control issues identified by the Food and Drug Administration. Other manufacturers cannot pick up the slack because of their own production demands. In some cases, one or two companies may be the only producers of a drug.

Monetary factors also contribute to the shortage. The federal Medicare Prescription Drug, Improvement, and Modernization Act, enacted in 2003, keeps the price of drugs low by restricting the amount Medicare can reimburse prescribing physicians for generic drugs. If the price of generics erodes, some companies may choose to cease production of the less profitable drug in favor or manufacturing one that is more profitable.

Shortages of oncology drugs bring serious ramifications. When first-line medications are unavailable, physicians may need to delay treatment or opt for alternative treatments. In some cases, the alternatives are brand name drugs that raise treatment costs, have toxicity issues or may be less effective than the first-line drug.

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