Drug Shortages Compromise Oncology Research
Drug Shortages Compromise Oncology Research
The reasons for the drug shortages in the United States are multifactorial and have been reported by Medscape. But all experts interviewed for this article agree that the profit motive is one of the drivers and that the business model of generic companies needs to be reinvented and reinvigorated to encourage generic companies to stay in business.
Dr. Schilsky commented that the basic business model for generic production has to change to allow these companies to operate in response to supply and demand.
"Canada, Europe, and Japan do not have drug shortages," commented Laurence Baker, DO, chair of SWOG (formerly the Southwest Oncology Group) and Professor of Medicine and Pharmacology at the University of Michigan, Ann Arbor. "The laws in these countries don't create drug shortages, and supply and demand operate. We have 2 laws that have contributed to the problem: the Hatch-Waxman Act that made generics more widely available, and the Medicare reimbursement policy initiated in 2004that pays oncologists for injecting drugs into their patients. These drugs are purchased from a generic distributor, but the manufacturer may decide that it is more profitable to sell a different drug. The price of a generic drug cannot be lowered, because if that happens it cannot be raised again, so the laws of supply and demand don't operate. This pits generic companies against each other, and some companies simply stop making the drug."
In contrast to cooperative group trials, industry-sponsored trials seem to be in less trouble. Investigational drugs are not in short supply, and sometimes pharmaceutical companies planning clinical trials will stockpile drugs needed for the control arm.
According to Dr. Baker, pharmaceutical companies are ahead of the cooperative groups in terms of finances at every level. "A drug company will pay about $25,000 per patient enrolled in a clinical trial for drug approval, but a cooperative group will pay about $2000 per patient for the same type of study. This is a 10-fold difference. The government does not engage in profit-making," he stated.
"Whether clinical trials are undertaken by cooperative groups or industry, the drug shortage creates huge problems. Overall, everybody is in trouble," Dr. Cheson said.
Profit Motive Is an Issue in Shortages
The reasons for the drug shortages in the United States are multifactorial and have been reported by Medscape. But all experts interviewed for this article agree that the profit motive is one of the drivers and that the business model of generic companies needs to be reinvented and reinvigorated to encourage generic companies to stay in business.
Dr. Schilsky commented that the basic business model for generic production has to change to allow these companies to operate in response to supply and demand.
"Canada, Europe, and Japan do not have drug shortages," commented Laurence Baker, DO, chair of SWOG (formerly the Southwest Oncology Group) and Professor of Medicine and Pharmacology at the University of Michigan, Ann Arbor. "The laws in these countries don't create drug shortages, and supply and demand operate. We have 2 laws that have contributed to the problem: the Hatch-Waxman Act that made generics more widely available, and the Medicare reimbursement policy initiated in 2004that pays oncologists for injecting drugs into their patients. These drugs are purchased from a generic distributor, but the manufacturer may decide that it is more profitable to sell a different drug. The price of a generic drug cannot be lowered, because if that happens it cannot be raised again, so the laws of supply and demand don't operate. This pits generic companies against each other, and some companies simply stop making the drug."
In contrast to cooperative group trials, industry-sponsored trials seem to be in less trouble. Investigational drugs are not in short supply, and sometimes pharmaceutical companies planning clinical trials will stockpile drugs needed for the control arm.
According to Dr. Baker, pharmaceutical companies are ahead of the cooperative groups in terms of finances at every level. "A drug company will pay about $25,000 per patient enrolled in a clinical trial for drug approval, but a cooperative group will pay about $2000 per patient for the same type of study. This is a 10-fold difference. The government does not engage in profit-making," he stated.
"Whether clinical trials are undertaken by cooperative groups or industry, the drug shortage creates huge problems. Overall, everybody is in trouble," Dr. Cheson said.