FDA and large vs small scale drug manufacturing oversight

A New York Times article (April 4, 2011) describes the impact of decisions by the FDA not to regulate “compounding pharmacies” that make versions of drugs not commonly available (for example liquid forms of tablet medications).  The expectation is that these compounding pharmacies produce small volumes, so that FDA compliance would significantly raise costs and thus prices. But, as the article describes, for a drug taken to prevent premature birth, the branded manufacturer of a drug called Makena, that is subject to FDA oversight, decided to warn compounding pharmacy producers that they were in violation of the law.  The FDA decided that such warnings were not appropriate. But the separate reports of deaths of nine patients in Alabama suggest that the balance between regulatory compliance and cost reduction requires a balance of risk vs cost.  Should all pharmaceutical manufacturers, regardless of volume, be regulated by the FDA ? Should “caveat emptor” be the approach, with demands to let the customer no that the drug has been manufactured without FDA oversight ?

About aviyer2010

Professor
This entry was posted in Operations Management, Service Operations, Supply Chain Issues and tagged , , , , . Bookmark the permalink.

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