Prescription drugs in the United States must be considered critical infrastructure

To ensure the safety and integrity of the U.S. drug supply chain, it is important for all parties within it to view the drugs themselves as critical infrastructure for the entire country, not just the pharmaceutical industry. With a large portion of drugs’ active pharmaceutical ingredients (APIs) being imported from other countries such as India and China, drug shortages have become an increasingly significant issue that threatens the fabric of critical infrastructure in the United States.

“The first point I would like to make is that drugs are an important infrastructure and drug shortages are a real challenge for us. When you think about being a pharmacist, being a healthcare worker, or just being an American, we assume that when you need a medication, it’s either at the corner pharmacy when you walk in, or at the Pharmacy on site will be hospital if you go there. We just can’t imagine it not being there,” said Stephen Schondelmeyer, PharmD, PhD, FAPhA, professor and director at the PRIME Institute.¹

Medicines are critical infrastructure as they must remain constantly accessible. When a patient needs a life-saving medication, they expect that medication to be available at every pharmacy they visit. However, when essential, life-saving medications are not available, drug shortages occur. According to Schondelmeyer, drug shortages are caused by parties within the supply chain failing to treat pharmaceuticals as critical infrastructure.

While there isn’t necessarily any one party in particular that is collectively responsible for the drug shortages continuing, there is an intricately designed system in place to take drugs and get them into the hands of patients across the country. Schondelmeyer mentioned the gaps in this system that have led to drug shortages, a problem that has persisted in the United States recently.

Before we delve into the drug shortage statistics and possible causes in the United States, it is important to understand the varied definitions of the term “drug shortage.” According to Schondelmeyer, there are two key definitions of drug shortages – one that focuses on the manufacturer and another that focuses on the patient.

READ MORE: Drug shortages more likely in US than Canada

“The FDA defines drug shortages as a period during which demand or projected demand for the drug in the United States exceeds supply. Quite simply: demand exceeds supply. Now, [American Society of Health-System Pharmacists (ASHP)] also has a definition, and its definition is a supply issue that affects how the pharmacy prepares or dispenses a medicine or affects patient care when prescribers use an alternative remedy,” he continued.¹

Because the FDA focuses only on the supply and demand of prescription drugs, its definition focuses on the manufacturer or the market. Because ASHP puts the patient first, Schondelmeyer described her definition as workflow-focused, showing that drug shortages can have a significant impact on the way pharmacy operations are run.

He then presented current drug shortage statistics according to ASHP. From 2014 to the present, drug shortages in the United States have gradually but steadily increased, peaking at 323 shortages in late 2023/early 2024. Additionally, 220 is the lowest number of medications facing shortages since 2018.²

To explain why drug shortages in the U.S. have reached such unprecedented levels, Schondelmeyer discussed the differences in the upstream and downstream drug supply chains within the pharmaceutical industry. He described the phenomenon that as U.S. consumers we don’t know exactly where our medications come from.

“We know a lot about downstream drug supply. Shortages have occurred due to shortages in downstream drug supply, but this is not the primary cause of drug shortages in the United States. While it causes some things, some things can be prevented, the root cause is upstream, and yet it is the side we are most blind to,” he said.

In the downstream supply chain, a drug begins with the manufacturer, is marketed and repackaged for dispensing, and finally is shipped to a pharmacy and administered to the patient. In the upstream supply chain, the ingredients of the drug are prepared and the drug itself is formulated into a product. It is then packaged, labeled, approved and finally ready to enter the US drug market.

Schondelmeyer compared the two sides of the pharmaceutical supply chain and noted that outsourcing of upstream supply chain activities in the United States has led to drug shortages. In fact, for branded drugs, 100% of the downstream supply chain for branded drugs is handled in the US, while 53% of the upstream supply chain for branded drugs is handled in the US. Even more concerning is that 100% of all activity in the upstream generic drug supply chain occurs outside the US.

Much of the upstream U.S. drug supply chain was handled in India and China, which also brings with it some troubling geopolitical implications. One of the few drugs that was almost entirely manufactured in the U.S., both upstream and downstream, was the opioid class of drugs, showing that U.S. companies will follow suit when money is on the line and demand is high, according to Schondelmeyer .

“This is an unacceptable performance by the market and the drug supply system. We have to do something. “We need to change the way we operate our drug delivery system and encourage it to be better,” concluded Schondelmeyer.¹

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References

1. Schondelmeyer SW. Drug Shortages and Building a Resilient Drug Supply Chain: An Examination of National Security Issues and Policy Solutions. Presented at: Seminar “Developments in Pharmaceutical Law 2024”; 7th–10th November 2024; Phoenix, AZ.

2. Fox ER, Ganio M. Drug shortage statistics. American Society of Health System Pharmacists. 2024. Accessed November 6, 2024.