A variety of generic pills and capsules.
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The Federal Trade Commission said Wednesday it is examining the role drug wholesalers and companies that buy drugs for U.S. health care providers play in the shortage of generic drugs that make up the bulk of U.S. prescriptions.
The move follows unprecedented shortages of vital medicines, from injectable cancer therapies to generics or cheaper versions of brand-name drugs, over the last year that have forced hospitals and patients to ration medications. Issues from quality control in manufacturing to spikes in demand can lead to supply issues.
But the Biden administration is focusing on other players in the drug supply chain to uncover the “root causes and potential solutions” to the ongoing shortages.
In a joint request for information, the FTC and the Department of Health and Human Services are seeking public comment on the contracting practices, market concentration, and compensation of two types of intermediaries. These are group purchasing organizations that broker drug purchases for hospitals and other health care providers, and drug wholesalers that purchase drugs from manufacturers and distribute them to providers.
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The request for information examines whether these intermediaries have abused their market power to reduce the prices of generic medicines to such an extent that manufacturers no longer make a profit and are forced to stop production and that rival suppliers are prevented from competing in the generic medicine market.
“The FTC is interested in looking at this market because on one side of the market there are patients who are desperate for the right drug and would pay a very high price for that drug if they could. And on the other side of the market.” “There are manufacturers that can’t get more than a few dollars per dose of the same drug,” Doug Farrar, director of the FTC’s Office of Public Affairs, told CNBC.
“So this negative outcome for patients was the reason the FTC wanted to investigate this market,” he added.
The FTC and HHS did not name specific companies. But Vizient, Premier and HealthTrust are among the largest hospital purchasing groups Cencora, Cardinal Health And McKesson are responsible for approximately 90% of prescription drug sales in the United States.
The public has 60 days to submit comments to Regulations.gov, the FTC said.
Group purchasing organizations and wholesalers have received limited attention on Capitol Hill, although curbing high drug costs has become a key priority for lawmakers in both chambers.
As part of efforts to reduce the cost of medications, lawmakers have… have called for more transparency about their business practices from pharmacy benefit managers who negotiate drug discounts on behalf of insurance companies and other payers.
PBMs claim that manufacturers are responsible for high drug prices, while drugmakers claim that the rebates and fees charged by these middlemen force them to increase list prices for products.
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2024-02-14 17:54:16
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