Drug Shortage Prevention and Mitigation Act - Comment Letter

Dear Chairman Wyden, Ranking Member Crapo, and members of the Committee,

The Duke-Margolis Institute for Health Policy (“Duke-Margolis” or “the Institute”) appreciates the Committee’s ongoing work to address chronic drug shortages, as well as ongoing opportunities to provide feedback to the Committee on its proposals.  

The Duke-Margolis Institute’s mission is to improve health, health equity, and the value of health care through practical, innovative, and evidence-based solutions. Duke-Margolis has conducted years of research and stakeholder engagement aimed at promoting drug supply chain reliability and preventing drug shortages, most recently including the work of the Duke-Margolis ReVAMP Drug Supply Chain Consortium that was founded in 2023. Through the Consortium, we’re working to generate effective policy solutions that promote a reliable drug supply chain to improve patient outcomes by reducing the frequency and severity of drug shortages. 

The recommendations herein do not necessarily represent the views of Consortium Members and are not intended to limit the ability of Consortium members to provide their own comments on behalf of their independent organizations but are informed by the Institute’s work with Consortium Members.

While we recommend some modifications to the draft “Drug Shortage Prevention and Mitigation Act” below, we generally support the Senate Finance Committee’s proposed approach to address drug shortages through the implementation of new demand-side policy steps. These steps, with some modifications, would promote a collaborative approach where all supply chain stakeholders – payers, providers, group purchasing organizations, wholesalers, manufacturers, and others – jointly share in the responsibility to prevent drug shortages on behalf of patients. The Committee’s proposal shares many common features with the approach proposed in our recent Health Affairs article on this topic. If designed and implemented effectively, this approach can save providers time and money by preventing shortages that leave them scrambling for scarce medicines, enable group purchasing organizations, wholesalers, and others to expand committed contracting models while reducing provider burden through streamlined and aggregated reporting, and allow manufacturers of essential generic medicines more stability and certainty of a robust market for their products. Most importantly, this approach can help to ensure patients have access to the drugs they need when they are needed.

Below is a summary table of our recommendations and a rationale for implementing demand-side steps to address drug shortages. Our full recommendations are included in our full comment letter.

We look forward to engaging with the Committee and other stakeholders as the draft legislation continues to be refined.

Sincerely,

Stephen Colvill 
Thomas Roades
Cameron Joyce
Gerrit Hamre
Mark McClellan