Here’s what the Food and Drug Administration says about drug shortages:
Drug Shortages can occur for many reasons, including manufacturing and quality problems, delays, and discontinuations. Manufacturers provide FDA most drug shortage information, and the agency works closely with them to prevent or reduce the impact of shortages.
which is not particularly illuminating. I think a big part of the answer is supply chain problems. Relatively few pharmaceuticals are made in the United States from components made entirely in the United States. That is particularly true of generics. Most generics are manufactured either in China or India from components at least some of which are manufactured in China. That introduces many problems including that China has been subsidizing its pharmaceutical sector for the last 40 years which places China at a competitive advantage and Chinese pharmaceutical companies have been known to manipulate supply and prices to preserve market share. I suspect that Indian and American pharmaceutical companies are not above such shenanigans.
The United States both subsidizes and penalizes its pharmaceutical sector. Our very expansive patent system, for example, is a subsidy while our approval and health, safety, and environmental regulations are penalties.
The White House’s strategy for dealing with pharmaceutical shortages is described here. I doubt that the headline measures (creation of a Council on Supply Chain Resilience and using the Defense Production Act to make more pharmaceuticals in the U. S.) will have much short term effect.
BTW this article from the NIH is interesting.
This has been an issue I have followed for years and a number of individual specialties have investigated. Note that shortage rarely occur with drugs under patent. This is mostly an issue with older, generics. While drugs under patent are generally the most expensive in the US generic drugs in the US are among the cheapest. Markets have worked to drive down the costs to the lowest possible. This means that most fo these drugs were moved overseas where it’s cheaper to make them and it means that often, 40% of the time according to one study, you get down to one producer. Even when it’s not just one it’s usually only 2 or 3. There is little redundancy in the system so a glitch in one company has large effects, especially since everyone uses just in time inventories. (In reality most people do have some reserves but it costs money to have those so they arent large.)
On geography it should also be remembered that most of the components used to produce drugs in India come from China. And it’s not just drugs. Remember the hurricanes that hit Puerto Rico? Turns out a lot of our normal saline bags came from there. When they got hit there was an interruption and we had shortages of salt water of all things. We can change this but it would cost us money. Alternatively, we decide to pay the drug companies in the US what other countries pay for drugs. Since pharma kind of owns Congress dont see that happening.
Steve