America’s Life-Threatening Drug Shortages Reach Record Highs

Last year, Americans spent over $600 billion on prescription drugs. That’s more than ever before — and more than any other country in the world.

Yet despite all those dollars, the number of drugs in shortage rose to a near-record total of 301 active medication shortages at the end of 2023. That’s according to the American Society of Health-System Pharmacists. Millions of Americans, including many children, have to go without essential medicines to treat illnesses ranging from routine infections to potentially fatal cancers.

Two of the most widely used cancer treatments — cisplatin and carboplatin — have been in shortage for much of the past two years. When business professor Laura Bray learned that her 9-year-old daughter, Abby, had leukemia and that the hospital treating Abby had none of the cancer drugs she needed, Laura called over 100 hospitals and medical suppliers until she found a supply of the medicine. Once Abby recovered, Laura set up a nonprofit, Angels for Change, to help other families with drug shortages.

America’s drug shortage crisis stems from an excessive dependence on imported pharmaceuticals, especially those produced in China and India. A Coalition for a Prosperous America analysis of the latest data from the federal government shows that a record 57.6% of U.S. pharmaceutical imports (measured by weight) came from China and India in 2023.

This dependence on drugs from China is not just a health issue. It’s also a national security issue. In the event of a military confrontation or rising international tensions, China’s government could decide to ban drug shipments to the U.S. — and to intermediate suppliers that produce drugs destined for the U.S.

A Department of Defense study found that China accounts for 95% of ibuprofen imports, 91% of hydrocortisone imports, 70% of acetaminophen imports, and 40% to 45% of penicillin imports. The production of these and many other generic and over-the-counter medications is dependent on China. According to one industry expert, roughly 100 drugs prescribed in the U.S. are dependent on a single factory in China.

The source of the problem is that the U.S. health system, especially hospitals, pushes hard to reduce the price of every pharmaceutical. This has driven production offshore, especially to China and India. Those countries have lower costs, in part because their governments subsidize drug production and drug exports.

Another important reason that China and India have lower costs is that their governments make it hard for Food and Drug Administration officials to inspect production sites in those countries. The result is a much higher rate of safety violations and unsafe products shipped from China and India.

A Bloomberg report documented the dangers of India’s generic drug production, observing that “India is scandalously short on regulatory oversight” and “its generic cough syrups have killed dozens of children, its eye drops have caused blindness, and its chemotherapy drugs have been contaminated.”

The Indian drug producer Aurobindo Pharma has been cited repeatedly by the FDA for unsafe manufacturing practices, including “significant deviations” from safety protocols, “repeated failures” to address safety concerns, and “contamination at levels above the acceptable limit.”

In Congress, Rep. Claudia Tenney, New York Republican, is addressing the problem with the Producing Incentives for Long-term Production of Lifesaving Supply of Medicines Act introduced last October. Following the model of the Inflation Reduction Act, the PILLS Act would rebuild U.S.-based pharmaceutical production by providing tax credits to U.S. companies that invest in the production of finished drugs and active pharmaceutical ingredients.

The problem is not with branded prescription drugs, where treatments can cost thousands of dollars a month. America’s drug shortage problem is with generic medicines and some over-the-counter medicines. These products are now so inexpensive that supply is overly dependent on only a few sources, most of which are offshore.

The long-term solution is to ensure there are enough suppliers and enough redundancy in the system to eliminate shortages. However, the immediate problem is reducing America’s dependence on China and India. Ms. Tenney’s PILLS Act would be a good start to address this.