Reducing Prescription Drug Shortages

Executive Order 13588 of October 31, 2011

Reducing Prescription Drug Shortages

By the authority vested in me as President by the
Constitution and the laws of the United States of
America, it is hereby ordered as follows:

Section 1. Policy. Shortages of pharmaceutical drugs
pose a serious and growing threat to public health.
While a very small number of drugs in the United States
experience a shortage in any given year, the number of
prescription drug shortages in the United States nearly
tripled between 2005 and 2010, and shortages are
becoming more severe as well as more frequent. The
affected medicines include cancer treatments,
anesthesia drugs, and other drugs that are critical to
the treatment and prevention of serious diseases and
life-threatening conditions.

For example, over approximately the last 5 years, data
indicates that the use of sterile injectable cancer
treatments has increased by about 20 percent, without a
corresponding increase in production capacity. While
manufacturers are currently in the process of expanding
capacity, it may be several years before production
capacity has been significantly increased.
Interruptions in the supplies of these drugs endanger
patient safety and burden doctors, hospitals,
pharmacists, and patients. They also increase health
care costs, particularly because some participants in
the market may use shortages as opportunities to hoard
scarce drugs or charge exorbitant prices.

The Food and Drug Administration (FDA) in the
Department of Health and Human Services has been
working diligently to address this problem through its
existing regulatory framework. While the root problems
and many of their solutions are outside of the FDA's
control, the agency has worked cooperatively with
manufacturers to prevent or mitigate shortages by
expediting review of certain regulatory submissions and
adopting a flexible approach to drug manufacturing and
importation regulations where appropriate. As a result,
the FDA prevented 137 drug shortages in 2010 and 2011.
Despite these successes, however, the problem of drug
shortages has continued to grow.

Many different factors contribute to drug shortages,
and solving this critical public health problem will
require a multifaceted approach. An important factor in
many of the recent shortages appears to be an increase
in demand that exceeds current manufacturing capacity.
While manufacturers are in the process of expanding
capacity, one important step is ensuring that the FDA
and the public receive adequate advance notice of
shortages whenever possible. The FDA cannot begin to
work with manufacturers or use the other tools at its
disposal until it knows there is a potential problem.
Similarly, early disclosure of a shortage can help
hospitals, doctors, and patients make alternative
arrangements before a shortage becomes a crisis.
However, drug manufacturers have not consistently
provided the FDA with adequate notice of potential
shortages.

As part of my Administration's broader effort to work
with manufacturers, health care providers, and other
stakeholders to prevent drug shortages, this order
directs the FDA to take steps that will help to prevent
and reduce current and future disruptions in the supply
of lifesaving medicines.

Sec. 2. Broader Reporting of Manufacturing
Discontinuances. To the extent permitted by law, the
FDA shall use all appropriate administrative tools,
including its authority to interpret and administer the
reporting requirements in 21 U.S.C. 356c, to require
drug manufacturers to provide adequate advance

notice of manufacturing discontinuances that could lead
to shortages of drugs that are life-supporting or life-
sustaining, or that prevent debilitating disease.

Sec. 3. Expedited Regulatory Review. To the extent
practicable, and consistent with its statutory
responsibility to ensure the safety and effectiveness
of the drug supply, the FDA shall take steps to expand
its current efforts to expedite its regulatory reviews,
including reviews of new drug suppliers, manufacturing
sites, and manufacturing changes, whenever it
determines that expedited review would help to avoid or
mitigate existing or potential drug shortages. In
prioritizing and allocating its limited resources, the
FDA should consider both the severity of the shortage
and the importance of the affected drug to public
health.

Sec. 4. Review of Certain Behaviors by Market
Participants. The FDA shall communicate to the
Department of Justice (DOJ) any findings that shortages
have led market participants to stockpile the affected
drugs or sell them at exorbitant prices. The DOJ shall
then determine whether these activities are consistent
with applicable law. Based on its determination, DOJ,
in coordination with other State and Federal regulatory
agencies as appropriate, should undertake whatever
enforcement actions, if any, it deems appropriate.

Sec. 5. General Provisions. (a) Nothing in this order
shall be construed to impair or otherwise affect:

(i) authority granted by law to an agency, or the head thereof; or

(ii) functions of the Director of the Office of Management and Budget
relating to budgetary, administrative, or legislative proposals.

    (b) This order shall be implemented consistent with
applicable law and subject to the availability of
appropriations.
    (c) This order is not intended to, and does not,
create any right or benefit, substantive or procedural,
enforceable at law or in equity by any party against
the United States, its departments, agencies, or
entities, its officers, employees, or agents, or any
other person.

    (Presidential Sig.)

THE WHITE HOUSE,

    October 31, 2011.