A worker walks past the pharmacy in a new Walmart Express store in Chicago
John Gress  /  REUTERS
There are over 200 scarce medicines this year alone, up from 56 in 2006, according to the FDA.
msnbc.com news services
updated 10/31/2011 9:08:54 AM ET 2011-10-31T13:08:54

President Barack Obama is directing the Food and Drug Administration to take steps to reduce drug shortages, action he says will help stop a "slow-rolling problem" that puts patients at risk and raises the potential for price gouging.

Obama signed an executive order in the Oval Office on Monday instructing the FDA to take action in three areas: broadening its reporting of potential drug shortages; accelerating reviews of applications to change production of drugs facing potential shortages; and giving the Justice Department more information about possible instances of collusion or price gouging.
Patient deaths have been blamed on the shortages, which tend to affect cancer drugs, anesthetics, drugs used in emergency medicine, and electrolytes needed for intravenous feeding. Hospitals have been forced to buy from secondary suppliers at huge markups. Surgeries and cancer treatments have been delayed.

"Even though the FDA has successfully prevented an actual crisis, this is one of those slow-rolling problems that could end up resulting in disaster for patients and health care facilities all over the country," Obama said.

The president ordered the new steps without congressional approval, saying his administration refused to wait for lawmakers to act on similar legislation pending on Capitol Hill. The measure is part of a White House effort to use executive action to get around congressional Republicans.

Obama said the White House would continue to push lawmakers to pass bipartisan legislation to prevent drug shortages, but said "we can't wait for action on the Hill, we've got to go ahead and move forward."

The president was joined in the Oval Office by Health and Human Services Secretary Kathleen Sebelius, FDA Commissioner Margaret Hamburg, pharmacy manager Bonnie Frawley, and Jay Cuetara, a 49-year-old San Francisco cancer patient who told an FDA workshop last month how he grappled with a shortage in his chemotherapy drug.

There are over 200 scarce medicines this year alone, up from 56 in 2006, according to the FDA. Most of them are cheaper generic drugs that have been around for years, but yield low profit margins for their manufacturers. Others are said to be quality or manufacturing problems, or delays in receiving components from suppliers. The FDA does not have authority to force drug makers to continue production of a drug.

In the worst known case linked to the shortages, Alabama's public health department this spring reported nine deaths and 10 patients harmed due to bacterial contamination of a hand-mixed batch of liquid nutrition given via feeding tubes because the sterile pre-mixed liquid wasn't available.

Distributors in the so-called "gray market" are suspected of exploiting the situation to peddle the drugs at hundred-fold mark-ups, according to lawmakers investigating the situation.

The order largely mirrors what is already contained in separate bills in the House of Representatives and the Senate, and Obama is also expected to give his support to that pending legislation.

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The administration acknowledged the steps Obama approved won't solve a growing problem. Shortages have tripled in recent years and show no signs of slowing.

But Hamburg said, "We can make a very real and meaningful difference by expanding our network of early warnings."

Indeed, officials said the FDA has managed to prevent 137 drug shortages over the past 21 months when companies told regulators they were having trouble. Options include getting other manufacturers to ramp up their own production, helping to find alternative suppliers of key ingredients, even sometimes allowing temporary importation of competitors usually only sold abroad.

The executive action is part of a larger push by the White House to portray Obama, who is facing re-election, as an effective counterpoint to congressional Republicans blocking his jobs legislation. Last week, he issued an executive order to help homeowners refinance at lower mortgage rates and to allow college graduates to simplify and lower their student loan payments. On Friday he directed government agencies to shorten the time it takes for federal research to turn into commercial products in the marketplace.

The Associated Press and Reuters contributed to this report

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