OPINION:
Despite some progress and a decline in the number of new shortages, critical prescription-drug shortages continue to jeopardize patient access to medications. Unfortunately “When shortages strike medical supplies” (Web, March 14) is long on conspiracy theory and short on actual supply-chain experience or solutions.
The U.S. Food and Drug Administration has repeatedly identified quality-control problems, manufacturing issues and barriers to getting new suppliers on-line as the primary causes of drug shortages.
Group Purchasing Organizations (GPOs) are the sourcing and purchasing partner to virtually every U.S. hospital, as well as to the vast majority of long-term care facilities, surgery centers and clinics. Although GPOs do not manufacture, compound or take title to any drugs, they are working tirelessly alongside health-care providers, manufacturers and distributors to help maintain a safe and reliable supply of products.
The GPO contracting process, which is voluntary, provides predictability and stability to the market. GPOs help hospitals source and safely migrate to alternate products when shortages arise, track data on potential shortages, communicate with suppliers about product demand, evaluate supplier reliability when awarding contracts, and allow suppliers to adjust contract prices when they experience shocks to production.
GPOs are a market-based solution to rising health costs. They save hospitals, Medicare and Medicaid, and taxpayers up to $55 billion annually. The former chairman of the Federal Trade Commission recently examined group purchasing and found that GPOs reduce costs and are vigorously competitive, and that a change to the GPO model would increase costs to hospitals.
GPOs will continue to work with all supply-chain stakeholders to mitigate the impact of drug shortages and advocate for policy solutions that remove regulatory barriers to entry and increase competition and innovation in the generic-drug market.
TODD EBERT
President and CEO
Healthcare Supply Chain Association
Washington
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