FTC and HHS Launch Joint Inquiry into Generic Drug Shortages: Seeking Public Input on GPOs and Wholesalers

In a news release published on February 14, 2024, the US Department of Health and Human Services (HHS) issued a "Request for Information" in collaboration with the Federal Trade Commission (FTC). This request aims to gain insight into how group purchasing organizations (GPOs) and drug wholesalers may be contributing to shortages of generic drugs.

The release provides details on the need to receive comments from the public regarding large health care GPOs and drug wholesalers. They are also interested in receiving comments regarding their contracting practices to understand their potential impacts on the generic pharmaceutical market regarding pricing and availability of drugs. The FTC and HHS hope to uncover the true causes of drug shortages within the US and aim to identify potential solutions.

According to the New York Times, drug shortage concerns remain a prominent topic for lawmakers. Health experts and lawmakers have previously voiced concerns, most notably in Congressional hearings where oncology experts stated they were forced to ration chemotherapy drugs due to nationwide shortages.

"For years Americans have faced acute shortages of critical drugs, from chemotherapy to antibiotics, endangering patients," Lina M. Khan, FTC chairwoman, said in a statement published in the HHS news release.

Secretary Xavier Becerra also shared a statement, indicating the "devastating reality" Americans are living in because of these drug shortages. Secretary Becerra continues to emphasize that the Request for Information 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."

GPOs and drug wholesalers play crucial roles as intermediaries in the pharmaceutical industry, negotiating deals and facilitating the distribution of drugs to health care providers. The joint Request for Information aims to ensure that every consumer can access high-quality, affordable care by examining various aspects of the generic drug market.

The FTC and HHS are seeking public input on several topics related to generic drug markets, including compliance with legal obligations, the impact of market concentration on smaller healthcare providers, and the effects of the prevailing compensation model on manufacturers and suppliers. Interested parties are encouraged to submit their comments within 60 days through Regulations.gov, with all submissions being made publicly available on the site.

References

FTC, HHS seek public comment on generic drug shortages and competition amongst powerful middlemen. News release. HHS. Published February 14, 2024. Accessed February 16, 2024. https://www.hhs.gov/about/news/2024/02/14/ftc-hhs-seek-public-comment-generic-drug-shortages-competition-amongst-powerful-middlemen.html

Jewett C. U.S. agencies open inquiry into generic drug shortages. New York Times. Published February 14, 2024. Accessed February 16, 2024. https://www.nytimes.com/2024/02/14/health/drug-shortages-ftc-hhs.html