For the past year, there has been an exceptionally severe dearth of generic medications available to Americans, forcing millions to ration or, in many cases, simply go without prescriptions. Surely, the pharmaceutical industry has not been immune from supply chain woes that have bedeviled virtually all aspects of the American economy. But such macro forces may not be the only culprit behind this pressing matter.
Earlier this month, the Federal Trade Commission (FTC) and the Department of Health and Human Services, behind the strong backing of the Biden administration, began assessing the role that drug wholesalers, those who purchase medications from manufacturers and disseminate them to providers, and corporations purchasing medicines for hospitals and health care providers – otherwise known as group purchasing organizations (GPOs), the most prominent of which include Vizient, Premier and HealthTrust — have had in this historic shortfall of generic prescriptions. The FTC and Department of Health and Human Services were particularly interested in learning more about the business practices to determine whether such middlemen in the pharmaceutical drug supply chain industry have disincentivized rival drug suppliers from competing in generic markets and compelled manufacturers to halt production.
In an exclusive interview with CNBC, Doug Farrar, director of the FTC's Office of Public Affairs, remarked, "The FTC is interested in looking at this market because on one side of the market, you have patients that are desperate for the right drug and would pay a very high price for that drug if they could. And on the other side of the market, you have manufacturers that can't get more than a few dollars per dose of that same drug."
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