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Mitigating the US Drug Shortages Through Pareto-Improving Contracts

机译：通过帕累托改进合同缓解美国药物短缺

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摘要

Drug shortages have been a major challenge facing the US pharmaceutical industry and government in recent years. Although the problem has drawn tremendous attention from the government and media, limited academic research has been devoted to this problem, and few solutions have been proposed based on rigorous research. This study addresses the drug shortage problem from a supply chain perspective, a key aspect missing in the literature, and proposes to mitigate shortages through drug purchase contracts. By modeling the drug supply chain, we capture the objectives of various supply chain parties, and investigate Pareto-improving contracts that mitigate drug shortages, improve drug manufacturer's and group purchasing organization (GPO)'s profits, and cut government spending and healthcare providers' costs. We explore structural properties of key supply chain decisions and the Pareto-improving contracts, and conduct scenario analysis with realistic industry data to evaluate shortage mitigation solutions. Our analysis shows that increasing drug prices only, a solution advocated by many, is not very effective in shortage mitigation. Price increases must be paired with strengthened failure-to-supply clauses (called the IPS approach) to achieve consistent and significant shortage reduction as well as Pareto improvement. Across all scenarios tested, a 30% price increase under IPS can lead to a minimum, average, and maximum shortage reduction of 25%, 53%, and 70%, respectively. Our analysis also shows the impacts of IPS on different parties in the supply chain and the impacts of various model parameters on shortage mitigation. The IPS approach rewards reliability of drug supply, which is in line with the FDA's strategic plan to reward quality, but is easier to achieve in this regulation-based industry. Interactions with the government and industry practitioners indicate that IPS also challenges the current mindset in pharmaceutical contracting.
机译：近年来，药品短缺一直是美国制药业和政府面临的主要挑战。尽管该问题已经引起了政府和媒体的极大关注，但是对此问题的研究仅是有限的，基于严格的研究提出的解决方案很少。这项研究从供应链的角度解决了药物短缺的问题，这是文献中缺少的一个关键方面，并建议通过药品购买合同来缓解药物短缺。通过对药品供应链进行建模，我们捕获了各个供应链方的目标，并研究了改善帕累托的合同，以减轻药品短缺，改善药品制造商和团购组织（GPO）的利润，并削减政府支出和医疗保健提供者的收入。费用。我们探索关键供应链决策和帕累托改进合同的结构特性，并使用现实的行业数据进行情景分析，以评估缓解短缺的解决方案。我们的分析表明，许多人主张的仅提高药品价格的措施在缓解短缺方面不是十分有效。价格上涨必须与强化的“不予供应”条款（称为IPS方法）配合使用，以实现一致且显着的短缺减少以及帕累托改进。在所有测试的方案中，IPS下价格上涨30％可以分别使最小，平均和最大短缺量减少25％，53％和70％。我们的分析还显示了IPS对供应链中各方的影响以及各种模型参数对缓解短缺的影响。 IPS方法奖励药品供应的可靠性，这与FDA奖励质量的战略计划是一致的，但在这个基于法规的行业中更容易实现。与政府和行业从业者的互动表明，IPS还挑战了当前制药合同的观念。

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