Federal Spending Freeze Could Threaten Supply-Chain Security
The economic recession—recovering or not—was bound to affect FDA at some point. In his 2010 State of the Union address, President Obama proposed a spending freeze for US government agencies and programs that are not tied to national security. Entitlement programs such as Social Security and Medicare also would not be affected. “Like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don’t,” said the President in his speech.
If the freeze goes through (and it’s likely it will, considering that the President mentioned the use of the veto in his speech), the freeze will begin in FY 2011. Since FDA is neither tied to national security (at least, in the direct military sense) nor entitlement programs, its budgets are likely to be put into a status-quo state.
Such a freeze could gravely threaten FDA’s plans to improve global pharmaceutical supply-chain security. Over the past couple of years, the agency has been trying to amp up foreign inspections through its Beyond our Borders program, its joint-inspection pilot program with the European Medicines Agency and Australia’s Therapeutic Goods Agency, and its pending Supply Chain Security pilot program. The agency also has been establishing overseas offices to increase global collaboration. As a starting point for all these efforts, the agency requested a 19% budget increase for FY 2010, to a total of $3.2 billion. The new budget relies heavily on industry user fees, including $141 million in new proposed user fees.
FDA needs additional funding increases over the next few years to see through its goals successfully. Without money to increase staff or to carry out its programs between 2011 and 2014, the agency will either have to sacrifice some of its plans or cut into other budget areas, such as R&D for vaccines (of note, the President has said he does not want to sacrifice R&D in any area).
We all know that the agency has been cash-strapped—and resource-strapped—for several years. It’s been widely reported that while the agency’s duties have grown significantly (almost scarily so), its budget has not. Last year’s budget boost was helpful, but it was a drop in the bucket compared with what the agency needs to carry out a global agenda.
Various analysts note that the potential federal budget savings resulting from the spending freeze would be about $250 billion over a 10-year-period. That’s less than 3% of the estimated $9 trillion in deficits that the government is likely to accumulate over the next decade, reports the New York Times. So I’m wondering—as are many other Americans, I assume—whether this freeze is worth it?
Over the past few years, the global pharmaceutical supply chain—as well as the food supply chain—has been contaminated with melamine, diethylene glycol, and other adulterated ingredients. Counterfeiting of pharmaceuticals is at an all-time high. These breaches in quality and security for the drug industry have led to many unfortunate illnesses and deaths.
Obama’s new budget, which will include more details about the proposed freeze, is expected to be released on Monday, February 1. But, I don’t see how any amount of money can justify leaving our supply chains open to more potential harm.