IMS advises risk-based warning system for drug shortages

The IMS Institute for Healthcare Informatics has weighed in on the drug shortages issue, finding that more than 100 suppliers are involved, in contrast to many reports that generally attribute the problem to far fewer suppliers. The healthcare market watcher advises policy-makers that an early warning system for drug shortages is needed. That system should be based on risk identification (targeting low-cost, technically challenging and critical medicines), continuous demand forecasting, a volatility index of monthly supply changes at hospitals, and predictive modeling to anticipate shortages.

In its report, Drug Shortages: A Closer Look at Products, Suppliers and Volume Volatility, IMS finds three distinct supply patterns among the drugs in short supply compared with the period 2006 to 2009: First, 75 of the 168 short-supply products studied are in decline, with volume dropping more than 20% compared with the earlier period. Fifty-six drugs, by contrast, are stable, exhibiting levels within 80% to 120% of historical supply. Finally, 31 drugs are experiencing rising demand, exhibiting volume increases greater than 20%.

The researchers find also that 50 of the 168 products have only one supplier. And two-thirds have three or fewer suppliers, according to the report.

The shortage drugs are currently supplied by 98 companies controlled by 88 corporations, the researchers counted. Nine, however, supply 20 or more of the products, with Hospira ($HSP), Teva ($TEVA), Boehringer Ingelheim and Fresenius Kabi ($APCVZ) each supplying more than 50.

In September 2006, by contrast, the 168 drugs were supplied by 87 companies controlled by 77 corporations.

- read the release
- see the report (reg. req.)
- here's the exec summary
- and here's a 3-minute video summary

Special Report: Top drug shortages by treatment category

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