Six Things to Know About Drug Shortages

A recent article from Becker’s Hospital Review addressed some questions raised by the FDASIA drug shortage provisions.  The article noted six things hospital leaders should know about the drug shortage provisions in FDASIA.  The article was written by Wayne Matelski, JD, Arent Fox’s senior pharmaceutical and medical device attorney.

1. More drug manufacturers will need to report shortages.  Prior to the new law, shortage reporting only occurred under the most extreme circumstances where there was a discontinuance of a “sole source, medically necessary” drug.  Now, manufacturers of drugs that are life-supporting, life-sustaining or intended for use in the prevention or treatment of a debilitating disease or condition, including any such drug used in emergency medical care or during surgery — excluding radiopharmaceutical drug products — must notify the FDA of a permanent discontinuance in the manufacturing of the drug or an interruption of the manufacturing of the drug that is likely to lead to a meaningful disruption in the supply of that drug in the United States, and the reasons for such discontinuance or interruption.

A “meaningful disruption,” according to the law, refers to a change that is reasonably likely to lead to a reduction in supply.  The manufacturers will need to report serious shortages to the FDA at least six months prior to the date of discontinuance, or as early as is practical, according to the law.  Key to this provision will be how FDA defines
“reasonably likely” to lead to a supply reduction, and what constitutes a “life-supporting” and “life-sustaining” drug, as well as drugs intended for use in the  “prevention or treatment of debilitating diseases.”

2. Hospitals can repackage drugs in short supply.  The new law allows hospitals to repackage drugs if they are in short supply, though this does not apply to controlled substances.  Hospitals will thus be able to distribute the drugs in smaller amounts to extend the life of drugs in short supply.

“Before the signing of this new law, a hospital was technically not allowed to repackage drugs without registering with the FDA and explaining exactly how they divvy up the drugs.”

A provision in the new law allows hospitals and health systems to repackage and share drugs that are on the FDA-issued drug shortage list, and up to 60 days after a drug is taken off the list.  However, there's a caveat: the provision only applies to the repackaging of drugs within the same health system.  “Because of this, it's debatable if accountable care organizations (ACOs) can share drugs — the statute is vague and this will have to be the subject of further guidance from the FDA,” Mr. Matelski says.

3. Hospitals can request expedited drug approval.  To quell drug shortages, the law also allows hospitals and other stakeholders to request the FDA expedite approval of any new drug applications (NDAs) if the pending drugs may remedy shortages, Mr. Matelski says.

4. The FDA must notify appropriate organizations about shortages.  Organizations that should be notified include physicians, other providers and patient organizations. However, manufacturers’ trade secrets or confidential information are protected under the law.  “It will be up to the FDA to figure out what that confidential information is,” Mr. Matelski says.  Further, the law requires the FDA to have “effective communication with outside stakeholders.”  As Mr. Matelski points out, this includes a wide range of people involved in healthcare, from manufacturers to providers to patients.

5. Expect more federal reports on drug shortages.  Under the newly signed law, the FDA is required to complete and submit to Congress an annual report detailing the major actions it's taken to prevent or mitigate drug shortages, including expediting the review of pending applications.  Additionally, the Comptroller General has been tasked with studying the cause of drug shortages and formulating recommendations on how to prevent or alleviate such shortages in the future.

6. The law creates an FDA drug shortage ‘Task Force’.  Under the law, a new FDA drug shortage Task Force will be created to investigate drug shortages and develop and implement a strategic plan for moving forward.  The Task Force will be required to submit the plan within 12 months.

Further, the FDA is required to look for alternative treatments to help alleviate drug shortages and recruit outside stakeholders to help in the brainstorming process.  Mr. Matelski says hospitals have the knowledge to play a crucial role in suggesting alternative treatments to the FDA, but that hospitals, being busy places under tight budgets, may not have the time or resources to devote to working with the FDA on this.

He also addresses a deeper concern: the likelihood that the FDA will not actually have the resources and time it needs to deliver the added service asked of it in the law.  “The FDA is given all these new responsibilities in the new statute, and they are almost certainly not going to get the resources to put them all in place,” he says.  “These provisions are a good start, but I'm not sure they are going to be that effective, at least right away.”