Just the thought of drawing a road map to minimize drug shortages and bring pharma manufacturing home to US has been, can be and is a daunting task in the current environment. It can give all of us shivers. US is excellent to accept any challenge that has come its way. However, it has failed miserably to minimize shortages and put forth policies to bring at least generic and essential drug manufacturing home. Our inaptitude is very evident from the fact that we have been discussing these issues for more than TEN years and done nothing. Executive Orders have been ignored (1, 2, 3). Roadblocks are our current systems and ways drugs are sold under a mutually subsidized healthcare system.
I am proposing a pathway to overcome these challenges, obstacles and resolve conflicts. I am confident that improvements can be made to assure drug shortages are alleviated and pharma manufacturing comes home. My conjecture is that a totally outlandish outlier effort is needed.
I propose that the application filed for a generic drug be granted or denied in 90 days of filing. This is bold and very different from the current unknown time that could be anywhere between 3-4 years. Unless such steps are taken to resolve the issue of drug shortages and bringing manufacturing home, the current landscape is not going to change. Details are discussed later.
Proposed plan is of significant value to pharmaceutical companies as they will have start having return on their investment compared to multiple years it takes now. This will allow companies to meet the challenge and eliminate shortages. This program could be used by the companies to invest in new manufacturing technologies and methods (4,5) to improve their profits and compete for market share as is done in any free economy. Companies will have tested their manufacturing processes and systems to start production of quality products as soon as they receive FDA approval.
I have no vested interest in the outcome of the effort other than minimizing agony of fellow citizens to have food and staying healthy rather than making a choice between either (6).
Again, we as a country, have done nothing to eliminate drug shortages and bring their manufacturing home. Vested interests and the current participants/players including legislators have prevented anything meaningful to happen. No one wants to jeopardize their profits and vested interests. It is time we act as one country. Even with this effort profits are not going to go away. They will get just get redistributed.
Food and Drug Administration (FDA), Federal Trade Commission (FTC), US Legislators and other regulatory bodies will have to spearhead, support to create systems and implement what is necessary for the 90 day plan to work. Unless these entities act together in US’s national interest with the mission to eliminate shortages and bring manufacturing home, we will continue to have legislative hearings that are meaningless (too many to cite).
Across the board team effort would be needed to adopt the suggested system. Trust between the regulated and the regulators to supply approved quality drugs is critical. Any company that participates in the outlined effort should be trusted to supply FDA approved drugs. Any failure would be a cause for they not be able to supply generic drugs to the US market for the next five years.
Effort made here is not perfect but is a start. I am not against profits but in the current landscape drugs are distributed through selected channels with no open competition. No one knows the real price of drugs they use is THE problem. It has to change. In US’s mutually subsidized healthcare system price truth is lost and patients suffer. My conjecture is that the current drug distribution practices are THE bottleneck and THE problem.
For success of the proposed alternate pharma companies will have to commit to participate for at least five years. If they fall short on delivering product quality and/or stop supplying drugs within the year of their approval and/or collude with any other company (manufacturing or distributor) they will be barred from supplying drugs to the US market and/or establishing a manufacturing plant in US and its territories for the next five years even if they are a current supplier to the US market. With higher than current profits and US’s open market and size companies will be continually vying for entry. This will be an excellent opportunity for generic pharma companies. Purpose of short filing and approval times is necessary as it will minimize shortage time and companies will realize faster and higher return for their investment.
Companies who participate in eliminating shortages and producing generic drugs in US will have to abide by extremely strict code of conduct and compete in open market. Like any other competitive business only the best will survive. They will use internal cost and profitability analysis (4) to determine their participation. Companies will compete for the customers through open market competition i.e. competitive pricing and drug efficacy. Use of innovative technologies and their application and methods (4,5) will guarantee them cost advantage. Knowledge and creativity of company personnel could be put to test. Companies will have to shed technologies that have been used for the last 60+ years (4,5). No one would like to admit this but the current manufacturing methods are mortar and pestle technologies of yester years and need to be upgraded. It is time and challenge here might get them there.
Use of drug tier (7) system, an unnecessary bureaucracy, is a needless drug segregation system. It limits competition between companies who produce FDA approved drugs. It needs to be abolished. Direct competition between companies to cure the same disease will keep the quality high and prices competitive. Again better manufacturing technologies and creativity will be a win for the patients.
Generic drug producers will sell directly to the patients through mail order or similar channels thereby bypassing the existing channels that are controlled by limited distribution companies. Use of existing distribution channels is company’s choice.
US’s mutually subsidized healthcare system camouflages the real drug price to patients. We have to remember that the mission of the current channels is to maximize their profits at the expense of patients. Affordability and shortages are not a consideration.
Information exchange between companies and regulators:
Implementation of the proposed program could be a challenge for the regulators and the regulated. For its success, current ways, methods and information required by FDA and submitted by each individual company may have to be modified. Participating companies will have processes that will deliver quality product as soon as their submission is approved in 90 days (8,9,10,11). This approval time is the KEY to the success of the proposed program. Process information and methods submitted will be used to produce the approved product.
90 day approval requirement is a quantum change from the current practices. USFDA might have to modify its current ways and methods for the companies to submit information about their drug manufacturing methods, their efficacy and performance. There could be significant resistance within FDA and pharmaceutical companies. However, these changes are necessary if US wants to minimize shortages and wants to bring pharmaceutical manufacturing home. We have procrastinated for too long and overlooked needs of its population and national security.
For program’s success information required by FDA and/or other regulators has to be such that its personnel (chemists, chemical engineers, quality control) based on their experiences can envision every detail of the process (process, equipment, operating instruction, test methods and product quality specs etc.) without visiting the production site. FDA might have to create information templates (10, 11). These will make the basis for complete information and may allow FDA to ask for any additional information within 10 days of submission of the application. FDA will have 90 days to grant and/or deny from the date of filed application with clear explanation of every denial. Any falsified information submitted by the company will be grounds for barring the company to be in the US market for five years.
FDA (Food and Drug Administration) publishes performance standard for each drug’s dispensable form. They should be available to every manufacturing entity who would like to produce and supply the drugs to the US market.
It is expected that company’s staff is proficient in process development, manufacturing practices and product quality requirements from the onset. Same is expected at every filing company. Each participating company would have to test its chemistry, process and methods so that the production of quality product is flawless. In their application they will have to include process equipment, manufacturing process, operating instructions, test methods, product specifications and other quality information etc. for their active pharmaceutical ingredient (API) manufacture and formulation methods and proof that the product meets FDA established finished performance standards. Again, information submitted by the company should be sufficient, clearly stated and would be used for every individual generic drug approval submission. Good Manufacturing Practices have to be followed.
It is critical that every manufacturing company provides necessary details that will allow the application reviewer adequate information so that the s/he can envision the process, the equipment and various test methods to grant and/or deny the filed application. If the information asked and provided does not provide the necessary data, it could result in denial of commercialization of the drug. An oversupply of information is always helpful.
Using the filed information regulators from day of receipt will have 10 days to respond for every submitted application to the company for its completeness. If all of the information is not submitted from the onset, application most likely would be rejected in 10 days from the day of receipt. Thus, it is very critical that FDA creates near perfect information submission system that companies will use for application submission and evaluation. If complete 90 days from the filing date FDA will have to grant and/or deny their application. It will have to give definitive reasons for rejection.
If the company is to produce the same drug at more than one site, it has to submit individual application and the results of the produced product from each site in their application. Any inaccurate information that will influence approval of the application will become ground for rejection and bar the company from any subsequent filing for the same drug to USA for ONE year.
Compiling information can be a challenge but in the interest of customer safety and product performance, accuracy is a MUST. Perfection of information is expected as life depends on them when used. Regulators will have no hand holding meetings with companies as it is done today.
To assure companies are producing and distributing drug per their approved filing FDA would randomly check the distributed finished drugs against the quality claims of each company. Independent labs can be used to test products that is being sold. Any deviation/discrepancy will be grounds for disbarment for supplying drugs to the US market for the next FIVE years. Regulators will randomly perform unannounced inspection of the facilities producing drugs being distributed in USA. Company cannot prevent unannounced inspections in their respective countries.
For the outlined roadmap to succeed it is extremely critical that the information exchange between the regulator and the regulated is very accurate. This will allow each side to have an accurate understanding of the process being used to produce the desired product. There cannot be any ambiguity as inaccurate information will not allow approval of the process and significant monies will be lost. Core competencies and perfection of each team would be tested.
Each pharmaceutical company that can supply approved drugs should use distribution channel of their choice to compete and sell the drugs to the directly to patients. Direct sales are the key to the success of the proposed plan. Each finished drug product manufacturer like automobiles, smart phones or laptop computers that have equivalent functioning will compete on performance and price. Current distributors can participate but cannot prevent entry of others distribution channels as long as USFDA approved products are being distributed.
Since there will be no drug tier (7) system competition between drug companies for the sale of their FDA approved product/s, patient with the advice of their healthcare provider and product price can decide on the drug they want to use.
If any company is found to be colluding with any other drug producer, distributor or channel to limit availability of the drug and/or increase the selling prices each would be barred from supplying drugs to the US market for the next FIVE years. FTC and each US state can investigate. Companies being investigated cannot distribute or sell any approved drug/s during the course of investigation. Companies for every frivolous investigation would be reimbursed equivalent of ONE year’s revenue for that drug. Use of ombudsman might be necessary for any conflict resolution.
Companies opting to produce/establish manufacturing facilities in USA using the FOUR State Model (8) should be given preference.
It is expected that the companies who compete directly for the customers will innovate their manufacturing technologies (4) and methods and compete based on product quality. Open competition will benefit US population. My conjecture is that it will lead to manufacturing technology innovation, higher profits and higher quality products for the producing companies. This will be for US in general as it will bring new employment to the selected areas.
My speculation is that what has been proposed here could be strongly objected by FDA, FTC, drug conglomerates and members of current distribution system. Legislators should back and take a lead for such proposal. I expect that in an open market, quick approval and competitive drug distribution system, drug efficacy and price would level the playing field, reduce shortages, bring pharmaceutical manufacturing home and make drugs affordable. US being the largest generic market, companies would compete on the basis of drug quality, performance and price. It will be a win for US patients and best of the generic pharmaceutical manufacturing companies. Procrastination and meaningless talk about drug shortages and bringing manufacturing home has to end. It is TIME.
Girish Malhotra, PE
1. Executive Order 13588 Reducing Prescription Drug Shortages, October 31, 2011, Accessed August 31, 2020
2. Executive Order 13944 https://www.govinfo.gov/content/pkg/FR-2020-08-14/pdf/2020-18012.pdf Accessed April 26, 2022
3. Executive Order on America’s Supply Chains https://www.whitehouse.gov/briefing-room/presidential-actions/2021/02/24/executive-order-on-americas-supply-chains/ Feb. 21, 2021 Accessed May 30, 2022
4. Malhotra, Girish: Active Pharmaceutical Ingredient Manufacturing: Nondestructive Creation Accessed February 28, 2022
- Malhotra, Girish: Chemical Process Simplification: Improving Productivity and Sustainability John Wiley & Sons, February 2011
6. Malhotra, Girish: Drug Prices: Food vs. Medicine - A Difficult Choice for Some Profitability through Simplicity June 16, 2011
7. Understanding Drug Tiers Accessed October 22, 2023
8. Malhotra, Girish: ONE PAGE Road Map to Reduce Drug Shortages, Assure Quality and Improve Affordability,Profitability through Simplicity December 6, 2019
9. Malhotra, Girish: US’s Self Sufficiency for Generic Drugs: A Supply Dilemma and Potential Solutions, Profitability through Simplicity March 31, 2022
10. Malhotra, Girish: Can the Review and Approval Process for ANDA at USFDA be Reduced from Ten Months to Three Months? Profitability through Simplicity, March 25, 2017
11. Malhotra, Girish: Strategies to Increase Generic Drug Competition and Bring Manufacturing to The United States of America, Profitability through Simplicity, March 16, 2020