Monday, November 01, 2004

In American Health Care, Drug Shortages Are Routine

In American Health Care, Drug Shortages Are Chronic:
ANGRY about not getting a flu shot? Imagine being unable to find supplies of a medicine that limits damage from a spinal cord injury, a medicine that improves the health of a premature baby, or a medicine that fights systemic bacterial infectious.

Each of these drugs, and dozens of others, are in shortage in the United States right now. On any given day, 50 to 80 drugs, many of them life-saving, may be difficult or impossible to find. Some patients die waiting for them, or because a frustrated doctor substituted another drug without having adequate training.

The larger story behind the flu vaccine shortage is that drug supply disruptions in the United States have become routine.”

…causes are myriad - drug company mergers, production snags, low and high prices, even outbreaks of mad cow disease. But some economists say that they all stem from one central feature of the nation's public health system: no one is in charge.

…where governments play a much larger role in managing health care, shortages are much less common. For example, while America's supplies of flu vaccine have been short in three of the last four years, Europe's have not. "Europe's peaceful market guarantees that supplies are available," said Uwe Reinhardt, professor of health economics at Princeton University.

But there is so little political support for government intervention in the health care market in the United States that Senator John Kerry took pains in a recent presidential debate to say that his plan for expanding access to health insurance would not create a new government program. And some economists say that the disadvantages of the European model of heavy intervention outweigh the advantages.

Paul Ginsburg, president of the Center for Studying Health System Change, argued that drug shortages happen in the United States not because the government fails to intervene but because the health care market has a conscience that overrides market logic.

"If you could just double or triple the price whenever the supply chain was disrupted, it might be worth it to have excess capacity," Mr. Ginsburg said. But such price increases would be decried as unseemly profiteering. "It is the inability of the price system to react to these disruptions that is what leads to the potential for shortages," he said.

American hospital pharmacists say that chronic shortages have obliged them to become crisis managers. Every day, Scott Mark, director of pharmacy for the Children's National Medical Center in Washington, posts a three-page computer list of drugs in short supply, and every day the list is different. Some shortfalls last days, others years.

One reason they are so common is linked to the high prices of many drugs, especially new ones. At every point in the chain, from manufacturer to distributor to hospital and drug store, the cost of keeping significant supplies of drugs on hand can be prohibitively expensive.

For older drugs, the problem may be the opposite: once generic versions are available, prices may fall so low that a major supplier may suddenly decide to drop out, and rivals may be slow to take up the slack.

In most European countries, the government runs the health care system and buys the drugs that hospitals use. Prices for branded drugs are typically set lower than in the United States, while generics are higher. Hospitals have incentives to keep larger supplies on hand. And regulators keep closer tabs on supply issues.

The Food and Drug Administration has a special team that deals with drug shortages in the United States, but the team has few powers. Federal law requires that sole suppliers of life-saving medicines must give six months' notice before voluntarily discontinuing production, but a company that merely supplies most of a crucial drug can stop any time without notice.…

http://www.nytimes.com/2004/10/31/weekinreview/31harri.html


con·cept: In American Health Care, Drug Shortages Are Routine