News of the Day ... in Perspective10/31/2004
Many drugs in short supply
On any given day, any of 50 to 80 drugs, some of them life-saving, may be in short supply in the United States–not just influenza vaccine.
“Drug supply disruptions in the United States have become routine,” writes Gardiner Harris in the New York Times of Oct. 31.
One reason is said to be high prices, making it prohibitively expensive to keep large supplies on hand.
Some economists blame insufficient government regulation. “No one is in charge,” said Mark Roberts, professor of political economy at Harvard.
“Princeton economist Uwe Reinhardt said that the government’s unwillingness to intervene to ensure supplies of crucial drugs stemmed from an American adulation for risk-taking,” writes Gardiner. Reinhardt claims that Europe’s “peaceful market,” where government plays a much larger role, “guarantees that supplies are available.”
On the other hand, Paul Ginsburg, president of the Center for Studying Health System Change blames interference with pricing mechanisms. “If you could just double or triple the price whenever the supply chain was disrupted, it might be worth it to have excess capacity,” Mr. Ginsburg said. “It is the inability of the price system to react to these disruptions that is what leads to the potential for shortages.”
HHS Secretary Tommy Thompson threatens to prosecute anyone caught “price gouging” on influenza vaccine. AAPS News of the Day archive 10/18/04.
According to Patricia Danzon of the Wharton School, drug prices are higher on average in Canada, Switzerland, Germany, and Sweden than in the U.S. (see Myth No.4, National Center for Policy Analysis Report No. 230, October 1999, www.ncpa.org/studies/s230/s230.html. The newest and most effective drugs may be unavailable in Europe and Japan (see Myth No. 7). In the U.S., Medicare and Medicaid switch and ration drugs, to the detriment of patients (see Myth No. 9).
New York Medicaid prevents use of brand-name drugs by prohibitive hassle factor (AAPS News, Feb. 2003, p.2, Mar. 2003, p. 4).
Gervais RP. The necessity of free-market prices for medical care. J Am Phys Surg 2004;9(2) 55-57. www.jpands.org/vol9no2/gervais.pdf.