Government, industry are responsible for ensuring supply stability

There has been a prolonged shortage of generic drugs, which are cheaper than their brand-name equivalents. The government and manufacturers must implement urgent measures to avoid a situation in which necessary drugs do not reach patients.

A series of scandals involving manufacturers are behind the supply shortage.

Kobayashi Kako Co., a generic drug maker based in Fukui Prefecture, was forced to withdraw from the business after it was found in 2020 that the firm accidentally mixed an ingredient used in a sleep-inducing agent into a drug to treat such conditions as onychomycosis, a fungal nail infection.

Nichi-Iko Pharmaceutical Co., a major generic drug maker based in Toyama City, was ordered to suspend operations after it was discovered to have crushed tablets that had failed quality tests and reprocessed them. As a result, the company’s business deteriorated and it was forced to file for an out-of-court turnaround process known as alternative dispute resolution, a type of private liquidation.

Amid such circumstances, there have been delays in the production of generic drugs. As of the end of August last year, there were already shortages of about 3,000 generics. In a questionnaire survey by a drug store trade association, 75% of pharmacists said distribution had deteriorated compared to June last year, with no signs of improvement in sight.

Drug stores are coping with shortages by switching to expensive brand-name drugs and other generics, according to the survey. In addition to increasing the financial burden on household budgets, changing medication could increase the risk of taking the wrong drug. There is an urgent need to resolve the supply shortage.

Some manufacturers and wholesalers are said to be keeping excessive inventories to prevent supply disruptions. In March, the Health, Labor and Welfare Ministry urged manufacturers to stop adjusting shipments of about 2,000 items. Distribution snags need to be resolved as soon as possible.

In the United States, a database of information on drugs with supply concerns is publicly available. If the distribution process was made transparent in Japan, the need to maintain inventories would diminish. It is advisable for the government and the drug industry to work together to introduce such a system.

A series of scandals have undermined public trust in generic drugs. The industry must be reminded that the safety of medicines is a matter of life and death for patients, and work on legal compliance and quality control to prevent recurrences of similar incidents.

In order to do that, human resource development and capital investment are important. Even the largest generic drug manufacturers have yearly sales of less than ¥200 billion, and many of them are small and midsize companies with weak corporate strength. It is also important to strengthen their foundations through corporate realignment.

The government, which has promoted the spread of generic drugs, also bears a heavy responsibility. It has been pointed out that manufacturers have been unable to keep up with the rapid expansion of the market and have continued to produce drugs without a proper system in place.

A generic is chosen for 80% of drugs for which generics are available. They are a foundation that supports medical care services. The government also should work to strengthen inspections of manufacturers in order to ensure a stable supply.

(From The Yomiuri Shimbun, May 20, 2022)