Experts Believe Cheap Generic Drugs Are Hurting the U.S. Supply Chain

The prices of generic drugs in the U.S. are too low to be sustainable, experts say, causing some biotech and pharmaceutical companies to experience losses or go out of business entirely.

According to The Guardian, Inmaculata Hernandez, a professor at the University of California San Diego’s Skaggs School of Pharmacology, said that the prices of generic drugs are so low that manufacturers lack incentives to continue producing the generic versions of important medications.

“Drug manufacturing is a business first, so they’re always looking to maximize their products,” said Erin Fox, the associate chief pharmacy officer at the University of Utah. “It can get to the point where it’s not profitable to make those products anymore, and manufacturers start leaving.”

As more and more manufacturers are pushed out of the pharmaceutical sector by low profit margins and even losses on some drugs, experts find the U.S. is left with a drug supply chain that is susceptible to simple disruptions as well as natural disasters.

“At the heart of the issue is the market does not reward quality and reliability,” said Marta Wosinka, a senior fellow at the Center on Health Policy at the Brookings Institution in Washington D.C. “The price pressure on manufacturers is tremendous and certain types of drugs, especially generic sterile injectables, are particularly vulnerable.”

Erin Fox claimed that the most recent drug shortages in the U.S., including short supplies of Adderall, Methotrexate injections and fludarabine, are the “worst” she has seen in a decade.

“Just about 10 years ago we had serious chemotherapy shortages and physicians having to ration care for chemotherapy,” Fox said. “We’re there again.”

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• Source: https://www.supplychainbrain.com/articles/38875-experts-believe-cheap-generic-drugs-are-hurting-us-supply-chains