There are some interesting takeaways from this piece, including some perspective on the ongoing market conditions between Spectrum Pharma's (SPPI) Fusilev (levoleucovorin) and generic leucovorin.
"In a survey from the Institute for Safe Medication Practices, 25% of clinicians indicated that an error had occurred at their site because of drug shortages. Many of these errors were attributed to inexperience with alternative products — for instance, incorrect administration of levoleucovorin (Fusilev) when used as a substitute for leucovorin or use of a 1000-mg vial of cytarabine instead of the usual 500-mg one, resulting in an overdose"
"The main cause of drug shortages is economic. If manufacturers don't make enough profit, they won't make generic drugs. There have been some manufacturing problems, but manufacturers are not required to report any reasons or timetable for discontinuing a product. Contamination and shortages of raw materials probably account for less than 10% of the shortages. In addition, if a brand-name drug with a higher profit margin is available, a manufacturer may stop producing its generic. For instance, leucovorin has been available from several manufacturers since 1952. In 2008, levoleucovorin, the active l-isomer of leucovorin, was approved by the Food and Drug Administration. It was reportedly no more effective than leucovorin and 58 times as expensive, but its use grew rapidly. Eight months later, a widespread shortage of leucovorin was reported."
Generic leucovorin costs $32 per dose, whereas Fusilev costs $1284 - these extreme price differences also exist between other older generics (paclitaxel and doxyrubicin also cited) and their brand name competitors. This cost disparity contributes to the lack of commitment to generics in another way - the way that oncology drugs are purchased by doctors and then reimbursed by the healthcare payers. These rules were changed in 2003 to be a fixed 6% above cost - this provides incentive to prescribe the higher priced drugs since they make more money for the oncology practice.
The article goes on to discuss various reform possibilities that would address this and other issues in the healthcare system - I'll leave those discussions for another day!
SNY call quotes:
"So the issue in the U.S. is that there is an extreme shortage of certain older generic injectible drugs, principally. This appears to be a result of the fact that, as the FDA is busy becoming more demanding on inspections throughout the industry, including the generic sector. We all know that you have to continuously invest in injectible manufacturing technology. This is some of the most sophisticated and demanding production in the biopharmaceutical space. And it appears that some companies are finding that the upgrades to manufacturing are not really justified, given the really low margins on some products. So a number of companies appear to have gone out of stock.
I encountered this in meetings with the FDA in the U.S. I was actually surprised to learn that this isn’t really a short-term issue, this has been going on for a minimum of a year. So – and you’ve seen that the president has actually asked the FDA – it’s the first, I think, executive order that president of the United States has given the FDA in over 40 years – to actually look actively at how the FDA can facilitate others to come into the market and supply some of these products. Some of these are Sanofi products that we produce in Europe and around the world. And so we have made an offer that we could potentially – if there was a regulatory path, that we could potentially provide product. But at this stage, there’s nothing concrete to report and not clear whether the FDA will in fact provide that regulatory pathway."