2 April 2012 Submission: Health Committee Re Drug Shortages, J. M. Duffin, MD Phd

2 April 2012 Submission: Health Committee re Drug Shortages, J. M. Duffin, MD PhD

Thank you for inviting my submission. I am delighted that The Standing Committee on Health is examining the drug shortage.On behalf of my cancer patients, I have been following the problem for two yearsand with growing concern.I launched an information website in summer 2011: This site is a clearing house for information;it is run entirely by myself as a volunteer with no funding.There, I track the problem, linking all information,and posting stories of difficulties sent to me by readers. I hope it may be useful to the Health Committee.

Here is a summary of my position on the drug shortages.

1. The drug shortage did not arise with the crisis at Sandoz, Boucherville—it has been going for two years or more. The recent crisis finally drew wider attention to the matter.

2. The drug shortage is a global problem.

3. It involves many drugs –injectables and pills and topical agents. The one common factor is that these products are older, off-patent generics.

4. We cannot solve this problem without identifying and addressing all the causes.

5. Many causes are possible– some or most lie outside Canada. All may be partly true to some extent. The most plausible hypotheses include the following:

• Pharmaceutical industry lets generics wane to favour more profitable, brand-name drugs.
• Prices of generic drugs are too low to make them profitable.
• Pharmaceutical industry decides not to invest in plant maintenance in order to keep profits high; provoking a decline in manufacturing standards. These decisions may have been aggravated by the 2008-9 recession.
• The American FDA has tightened inspections and standards, tripling the number of warnings sent to manufacturers between 2008 and 2009.
• Slowdowns arise when a factory must stop to make repairs to meet the new (or newly enforced) standards. Even plants in Canada that sell to the USA must meet these standards.
• Shortage of raw materials, many of which come from outside Canada. If true, this should also affect the making of brand-name drugs—so raw material shortage cannot be the whole explanation.
• Developing countries are becoming more affluent and providing market competition for limited numbers of product.
• Single-purchasers, especially the large Group Purchasing Organizations (GPOs) in the United States—force industry to serve one large buyer, neglecting others.U.S. anti-trust laws have been broken by GPOs.*Market distortion elsewhere will affect other smaller markets, like Canada.

6. It is the role of the federal government to find out the relative weight of each of these causes. Why?

• Patent Law protecting research-based pharmaceuticals in return for their investment in Canadais federal;
• The Canada Health Act, with its pillar of access, is federal;
• Health Canada assures safety of drugs; surely Health Canada knows which products are vulnerable to single-supplier slowdowns.
• “Duty to supply”should be part of every license to market.

7.Therefore, federal government engagement with this issue would be part of its responsibility. It would not be interfering with provincial jurisdiction.

Consequences

The greater costs of substitute drugs will fall to the taxpayer, as many people taking drugs include seniors, those in hospital, and those on welfare who have their drugs paid for.

The working poor will suffer with illness if they cannot afford the replacements. People are already suffering serious side effects from the shortages.The taxpayer will pay for the health consequences too in terms of lost income taxes and health care expenses.

The government has a role to help contain health costs and maintain health of citizens.

Solutions – how can they be found?

Fast-tracking and advance notification about shortages are welcome, but they are merely stopgap measures. They will not solve the problem, because they do not address the causes.

The provinces did not cause this problem.Many causes,if not all,lie outside Canada.

The federal government needs to acceptresponsibility to determine the causes and explore their relative weight. Health Canada cannot do it alone. Given that the problem involves multinational manufacturers and internal business decisions, the ministries of industry, finance, and foreign affairs should also be involved.

Accepting that responsibility is not the same thing as accepting blame. It is the federal government’s role to identify the causes on behalf of all Canadians and find solutions.

Finding answersto the following questions would helpidentify solutions.

Questionsfor Industry and Government

• Why can we not start making the missing generic drugs in Canada?
• Why can we not encourage enterprising Canadians to createnew industries heremaking us independent of market swings and supply problems elsewhere?
• Can the practices of single buyerGPOs be altered to help this problem in Canada?And the USA?
• What proportion of generics used in Canada are made in Canada?
• What proportion of generics made in Canada are sold elsewhere?
• What is wrong with the pricing of generics that companies put scarce raw materials into more expensive drugs?
• Do industries accept a “duty to supply” in licensing contracts?
• Would the $150M of taxpayer money recently given to the research-based pharmaceutical industrynot be better placed in stimulating our manufacturing capacity for generic drugs?
• What has been the topic of the increased number of pharmaceutical lobbying events at the House of Commons since 2010?

Respectfully submitted:

JacalynDuffin, MD FRCPC PhD,

hematologist & historian,

Hannah Professor, Queen’s University,

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