FTC and HHS Launch Probe of Ongoing Generic Drug Shortages

FTC

Pictured: Flag on Federal Trade Commission building/iStock, bpperry

With drug shortages in the U.S. not greatly improving, the Federal Trade Commission and the Department of Health and Human Services announced Wednesday that they are issuing a request for information to look at different groups involved in generic drug supply chains and evaluate how they may be contributing to persistent shortages.

The FTC and HHS are inviting public comments on market concentration and are gathering information on the contracting practices among wholesalers and group purchasing organizations (GPOs).

GPOs act as go middlemen between providers and manufacturers to negotiate the price of generic drugs. The request for information (RFI) also aims to determine the influence GPOs and wholesalers have on the overall generic drug availability and pricing.

“For years Americans have faced acute shortages of critical drugs, from chemotherapy to antibiotics, endangering patients,” FTC Chair Lina Khan said in a statement. “Our inquiry requests information on the factors driving these shortages and scrutinizes the practices of opaque drug middlemen. We look forward to public input as we assess how enforcers and policymakers can best address chronic drug shortages and promote a resilient drug supply chain.”

The public has 60 days to submit comments to regulations.gov, where they will be posted publicly.

“Today’s announcement is part of the Biden-Harris Administration’s work to tackle health care monopolies and lessen the impact on vulnerable patients who bear the brunt of this lack of competition. Today’s initiative is just one more action by HHS to best address shortages of generic drugs,” HHS Secretary Xavier Becerra said in a statement.

The news from the FTC and HHS comes as a GAO report last week detailed how the FDA continues to encounter challenges in overseeing drug manufacturing sites overseas due to staff shortages and other factors. Experts on drug shortages recently told BioSpace that several factors, from manufacturing quality issues to factory closures to more systemic problems, have all contributed to shortages. 

Tyler Patchen is a staff writer at BioSpace. You can reach him at tyler.patchen@biospace.com. Follow him on LinkedIn.

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