Among the hundreds of medicines now in short supply are popular drugs used for weight loss such as Ozempic
By Liz Essley Whyte and Peter Loftus of The WSJ.
I liked that this article mentions that price increases are part of the solution, something that usually does get mentioned. A shortage means that current price is below the equilibrium price so that quantity demanded is greater than quantity supplied. If markets are allowed to work freely, prices will rise.
Excerpts from the article:
"Shortages of drugs in the U.S. have risen to an all-time high.
Supplies are low for everything from lifesaving injections to diabetes medications"
"A total of 323 drugs were in shortage in the first quarter of 2024, up from the previous high of 320 in 2014"
"some patients must visit several pharmacies to find a drug or wait longer to receive a key treatment or get second-choice substitutes or pay more if a generic drug is unavailable but the brand is."
"Lilly said “an unparalleled surge in demand” for Mounjaro and a cousin drug, the anti-obesity treatment Zepbound, have limited their availability. The company also has seen supply disruptions for an older diabetes drug, Trulicity."
"health economists have pinned most shortages on a broken pharmaceutical supply chain that makes it difficult for generic-drug makers to earn a profit and stay in business."
"Many generic-drug makers have left the business or offshored production to countries where labor is cheaper, such as India. Shortages can result, and linger, if a factory pauses production. There are few suppliers to pick up the slack, and it isn’t easy to jump-start manufacturing of a particular drug, especially the sterile injectables that are so tricky to make and that hospitals use so often."
"Continuing shortages reached a similar peak in 2014, then abated for several years. They have been on a mostly steady upswing since 2021."
"Fixing the problem will probably involve changing the business model, including taking steps that would increase the prices of generic medicines so sales can support manufacturers and attract additional companies, according to researchers and policymakers."
Related posts on supply and demand and shortages:
Record Cocoa Prices Are Making Sweet Cravings Expensive (2024)
Firms (that make EVs) lower prices when demand is less than expected (2024)
Orange Juice Prices Are at Record Highs—and Could Keep Climbing (2023)
Apartment Rents Fall as Crush of New Supply Hits Market (2023)
Why has the price of eggs risen so much? (2023)
Egg Prices Surge to Records as Bird Flu Hits Poultry Flocks (2022)
Is There A Booze Shortage? (2022)
Drivers Throttle Back as Gasoline Prices Rise (2022)
Cold Snap Sparks Record Rise in Natural Gas Prices in Asia (2021)
Are Expectations Helping To Raise The Price Of Lithium? (2021)
Used vehicle prices up as supply sinks, but relief is coming (2021)
Car makers face ‘chipageddon’ (2021)
Does the U.S. have a firefighter shortage (2021)
There is no truck driver shortage in the US (2021)
Is there a shortage of homes? (2020)
Farmers might be reducing supply of corn now in expectation of higher prices this fall (2019)
What Chocolate Shortage? Cocoa Prices Steady as Record Output Projected (2019)
Why honey prices have climbed about 25% since 2013 (2019-This post is featured in Introduction to Microeconomics by Luís Cabral. He is chair of the economics department at New York University.)
Introduction to Microeconomics by Luís Cabral
Is there really a shortage of construction workers (2019)
Was there really a shortage of meatless burgers? (2019)
Supply, Demand and the High Price of Vanilla (2019)
Egg market seems to act just the way supply and demand predict (2019)
How Supply Means Producing A Good And Customers Being Able To Purchase It (2018)
India sets a price floor for sugar and gets a surplus (2018)
Supply And Demand Have Affected Beef Prices Recently (2017)
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