Thursday, February 16, 2012

Averting Critical Drug Shortages, Pharmaceutical Supply Chains, and the FDA

I have been sharing the news regarding the drug shortages -- most recently of pediatric cancer drugs, with the students in the Humanitarian Logistics and Healthcare class that I am teaching this term at the Isenberg School of Management at UMass Amherst.

When there are shortages of life-saving drugs that can help cancer and other patients, from the very young to the old, it is unconscionable. Those in weakened physical shape should not have to endure the added stress of not being able to obtain life-saving medicines and the uncertainty of how the unavailability of such medicines will impact their survival.

There has been much discussion as to the reasons for the shortages, and we have written a paper, A Supply Chain Generalized Network Oligopoly Model for Pharmaceuticals Under Brand Differentiation and Perishability, Amir H. Masoumi, Min Yu, and Anna Nagurney, that is in press in the journal, Transportation Research E. In the paper, we develop a pharmaceutical supply chain network model that captures competition and demand for generic versus brand drugs as well as the perishability of pharmaceuticals. Clearly, if there is only one manufacturing plant and the product gets adulterated or there is some other type of processing failure or economic failure (a firm can no longer recover its costs and make a profit) then the impact on those who need the vital medicines is immense.

I was pleased to see that the US Food and Drug Administration (FDA), as reported by numerous newspapers, including The Chicago Sun Times, has managed to avert a “crisis” for children with cancer by preventing a looming shortage of the lifesaving drug methotrexate, a mainstay of treatment for a type of childhood leukemia. It was expected that the country would run out of methotrexate by the end of next week. According to The Chicago Sun Times, the shortfall arose when one of the four U.S. makers of methotrexate, Ohio-based Ben Venue Laboratories, shut down production late last year because of “manufacturing and quality concerns,” FDA spokeswoman Shelly Burgess said. The shortage is the latest in a series of serious shortages of cancer medications and other drugs that have frustrated doctors and patients over the past year and a half.

The shortage is an issue of life or death for the 3,500 kids diagnosed each year with acute lymphoblastic leukemia, or ALL. They endure two to three years of punishing therapies but are nearly always cured of their disease.

The FDA worked with the three remaining manufacturers that make preservative-free methotrexate, and all have agreed to ramp up production.

In this case, the media outcry led to some important and decisive action.

We need processes and systems in place to guarantee that quality pharmaceuticals can be produced and delivered to those who need them in a timely manner.