An industry analyst with the National Coalition of Pharmaceutical Distributors testified today to the U.S. Senate Committee on Commerce, Science & Transportation that small distributors are an important and necessary part of the health care supply chain. Patricia Earl, who spoke on behalf of NCPD, was one of five industry experts invited by the committee to testify during the hearing, which was convened to review short-supply prescription drugs.
“I cannot emphasize enough the value that small – or secondary – pharmaceutical distributors bring to the health care system,” Earl, a pharmaceutical distribution specialist with more than 25 years of experience, told the committee. “These organizations are there when no one else is – in the middle of the night, on the weekends and in remote parts of the country where no one else wants to deliver because it’s not considered profitable. As a result, small distributors help save lives every single day. They save lives by making it their business to ensure that quality medicines reach a patient in the safest, fastest and most cost-effective way possible – no matter the time or location. Few others can say the same thing.”
The hearing, “Short-Supply Prescription Drugs: Shining a Light on the Gray Market,” started with a presentation led by Rep. Elijah E. Cummings (D-Md), a ranking member of the U.S. House Committee on Oversight and Government Reform. Cummings presented a report outlining what he considered to be issues in the industry, including accusations of price gouging, multiple companies handling products before they reach the final customer and fake pharmacies.
“These allegations are not grounded in reality,” Earl said in her testimony. “What’s more, these characterizations fail to reflect one basic fact of this market: There are thousands of small distributors that work with hospitals across the nation. To remain competitive, they must comply with all laws, follow pedigree and handling requirements to the letter, and still offer an economical price point that allows for only a modest profit margin. If they engaged in the types of activities you accuse them of, they would not be in business very long.”
Earl provided the committee with stacks of emails from hospital customers, including the National Institute of Health, thanking small distributors for the help they provide finding medicine or delivering it at the last minute to save a life – a function typically only performed by this sector of the distribution chain. NCPD’s position was supported by Dr. John Costner, senior vice president of government affairs with the National Community of Pharmacists Association, which represents independent community pharmacies in the United States. Costner told the committee that small distributors are a necessary part of the U.S. supply chain.
“The pharmaceutical supply chain is a complex system with multiple players, including small and large distributors, group purchasing organizations, manufacturers and pharmacies. Each play a vital role in ensuring quality medicines reach patients,” said Karen Moody, NCPD president. “Small distributors handle less than 1 percent of all pharmaceuticals delivered in the U.S., supply hospitals in areas often considered to be the least profitable regions of the country, and are required to pay the highest prices for drugs in the U.S., putting us at a competitive disadvantage. Despite these realities, small distributors face repeated scrutiny over our work, which makes it difficult for us to reach our ultimate goal – to help hospitals and physicians provide the best care possible to patients.”
The National Coalition of Pharmaceutical Distributors is a national trade association representing the wellbeing and interests of the independent and specialty pharmaceutical distribution industry. NCPD is dedicated to securing the pharmaceutical supply chain and is aggressively working to help enact federal legislation to revamp the nation’s chain of custody laws for prescription pharmaceutical products.