On June 21, 2023, The Hamilton Project at Brookings hosted a webcast discussion, “Addressing Urgent Challenges for the Healthcare Supply Chain,” about recently exposed supply chain vulnerabilities and steps to make the prescription drug supply chain more resilient.
The event coincided with the release of a new Hamilton Project proposal: “Federal Policies to Address Recent Generic Drug Shortages” by Marta E. Wosińska and Richard G. Frank.
The event commenced with opening remarks from Hamilton Project Director Wendy Edelberg, followed by a fireside chat between Co-Director of the Healthcare Transformation Institute at the University of Pennsylvania Ezekiel Emanuel and Founding Director at the Duke-Margolis Center for Health Policy at Duke University Mark McClellan. The chat was moderated by Edelberg.
The chat began with both McClellan and Emanuel emphasizing that through their careers they have witnessed some of the same kinds of persistent drug shortages. Emanuel stated that the very first op-ed he was able to write in 2011 “was all about shortages of cancer drugs, at that time, creating the need to ration care. That’s 12 years ago, and we haven’t made progress. In fact, we’ve slipped behind.”
When asked whether international manufacturing and collaboration would realistically help the drug shortage issue, McClellan said, “Let’s not lose sight of what the underlying source of the problem is. It’s not just whether they’re manufactured in the U.S. or elsewhere, it’s is the manufacturing reliable and do we have reliable ways of measuring that and can we engage our healthcare purchasers in paying a little bit more?”
“Just because it’s domestic doesn’t make it high quality,” said Emanuel in agreement. “We have to have all three: domestic, high quality, and the willingness to pay the marginal extra cost … That is going to require legislation and regulation, and I think that’s something we shouldn’t kick down the road for another 20 years. I do think one of the advantages of the moment is the turning up of the political pressure.”
“I do think one of the advantages of the moment is the turning up of the political pressure.”
– Ezekiel Emanuel
Following the fireside chat, Edelberg moderated a panel between experts Brian McCormick, vice president, chief regulatory counsel, and head of global regulatory policy at Teva Pharmaceuticals and Marta Wosińska, senior fellow with the USC-Brookings Schaeffer Initiative for Health Policy.
“Quality and manufacturing issues are not the root cause [of the drug shortages]. The financial situation in the global generic drug industry is the root cause,” said McCormick. “It’s incumbent upon us to target our solutions to the problem, to the lack of financial sustainability in the global generic marketplace … If you’re not attacking the root cause, if you’re attacking, say, quality issues or if you’re attacking offshoring… you’re making the problem worse… What you’re doing in the policy choices is you’re adding cost to an already overburdened industry.”
“There is actual a connection between price and quality,” Wosińska replied. “The race [to get drugs from manufacturers to patients] does result in deteriorating quality which in turn leads to disruptions in production.” Wosińska’s proposal addresses this problem. “The most important element in the proposal is aimed at hospitals in trying to address how they buy and how they procure product,” she said.
“I think we are in a time of crisis with the number of shortages that are happening and where those shortages are happening.”
– Marta Wosińska
The event concluded on a hopeful note from Wosińska: “The window is open right now for policy,” she said. “When we have seen Congress really step up is in time of crisis. I think we are in a time of crisis with the number of shortages that are happening and where those shortages are happening. It is also a bipartisan issue, and relatively speaking, it’s not nearly as expensive as a lot of other things we are trying to fix. So, I am hopeful—maybe not optimistic, but I am hopeful.”