Dana Goldman–my colleague at PHE and a professor at USC–offers three suggestions on how to prevent generic products from increasing their prices drastically as occurred in the EpiPen saga. In Stat News, he makes three recommendations:
First, Congress should mandate that the Federal Trade Commission report on the availability of all such drugs and devices by identifying all the companies that make them and how they are being supplied to hospitals and pharmacies.
Second, the Food and Drug Administration should examine the FTC report to discover which essential products have competition or supply issues. When supplies are limited — epinephrine has been on a drug shortage list since 2012 — the FDA should be given new authority to allow foreign imports to solve the immediate crisis. In the case of the EpiPen, that would result in prices roughly one-quarter of Mylan’s US listed retail charge.
Finally, the Centers for Disease Control and Prevention, which has experience buying vaccines to prevent supply problems, should be authorized to begin buying essential generic drugs and devices on behalf of federal users, including Veterans Affairs, Medicaid, and Medicare.
Fostering competition is the best approach for driving down the price of generics. When that fails–perhaps due to the prescence of a natural monopoly or limited number of suppliers–then some additional government oversight may be necessary.