Food and Drug Administration officials acknowledge that its established system for ensuring the quality of medical products
marketed in the United States cannot cope with the soaring volume of pharmaceuticals and active ingredients coming into the
country from all over the world. Because of the potential for consumer harm from intentional adulteration, fraud, and counterfeiting,
these developments require major changes in the way FDA does business. Instead of sending inspectors abroad to scrutinize
foreign facilities or trying to examine more products at US borders than before, agency officials seek to collaborate more
with other regulatory authorities, to make greater use of third-party auditors, and to establish global-information networks
that can better alert officials to potential safety hazards.
The call for a new approach to food and drug regulation will have a notable impact on FDA field inspections and compliance
operations. The Office of Compliance (OC) in FDA's Center for Drug Evaluation and Research (CDER) has reorganized to heighten
its focus on supply chain and international issues. At the same time, manufacturers are supporting new approaches and collaborative
efforts to prevent drug theft, diversion, and distribution of counterfeit products around the world. These changes also reflect
FDA's need to cope with increasingly tight resources at government agencies and healthcare organizations. FDA faces a potential
$250-million reduction in its budget for fiscal year 2012, which begins Oct. 1, 2011, as Congress moves to cut funding for
most federal programs. Such a cut would severely limit funds for FDA field inspections in all regions and limit the increased
oversight of food producers and imports that has been mandated by new food-afety legislation.
The lines between domestic and foreign production are increasingly blurred. The difficulties of ensuring the safety and quality
of imported food and drugs in such a world are outlined in the report, "Pathway to Global Product Safety and Quality," which
FDA Commissioner Margaret Hamburg unveiled in June 2011. Although the report contains few really new proposals for overseeing
food and drug imports and outsourced production, the document is noteworthy for providing a comprehensive overview of the
forces reshaping biopharmaceutical product development.
In the face of pressure to cut costs and increase productivity, pharmaceutical companies are shifting manufacturing to foreign
locations and searching for less expensive ingredients. The cost of formulating an active pharmaceutical ingredient (API)
is 15% to 40% less expensive in India, than in the US. Consequently, drug manufacturers now import 80% of APIs, primarily
from China and India. Imports of pharmaceutical products have increased about 13% per year for the past seven years. This
shift is boosting the US trade deficit in pharmaceutical products, which has jumped from less than $2 billion in 2000 to $18
billion in 2008.
Additional overseas outsourcing, however, fragments the drug-production process. Contract manufacturing has more than doubled
during the past decade to an estimated $46 billion business in 2010. China and India now have the largest number of foreign,
FDA-registered drug manufacturing establishments. These and other emerging nations also are producing more complex, high-risk
biologics, and vaccines and are becoming more prominent in biopharmaceutical research and development (R&D). India and China
already have more than 30% of the world's drug master files, and more clinical trials are taking place in these regions. With
a growing volume of foreign manufacturers and producers to monitor, FDA concedes that it is not viable to scale up its current
regulatory model, even if it had the resources to do so.
These developments inevitably open the door to more economically-motivated abuse, drug counterfeiting, fraud, and intentional
adulteration. The FDA report observes that it has become "difficult to identify the 'source' of a product and to ensure that
all players along the supply chain meet with safety and quality responsibilities." The US already has suffered the consequences
of adulterated heparin and counterfeit glucose-monitoring strips, and low-quality counterfeit medicines are widely available,
particularly in developing countries. Americans feed illegal operators, moreover, by purchasing pharmaceuticals online, often
from unknown sources and without oversight and safeguards.