Decide withdraws from Medicare drug worth case after inventory possession is revealed

Ohio Governor Mike DeWine, right, shakes hands with Judge Thomas Rose of the U.S. District Court Southern District of Ohio after taking his oath of office, Monday, Jan. 14, 2019, in Cedarville, Ohio.

John Minchillo | AP

A federal judge on Friday withdrew from a case that could block Medicare from negotiating over drug prices, just hours after a watchdog group revealed his ownership of stock in two pharmaceutical companies that would be directly impacted by the new program.

Judge Thomas M. Rose of the U.S. District Court for the Southern District of Ohio withdrew from the case on the same day that the Revolving Door Project, a nonprofit, sent him a letter raising questions about his ownership of stock in Johnson & Johnson and AstraZeneca.

“Given the ethics concerns that your apparent conflict of financial interests in the pharmaceutical industry raise, we call on you to recuse yourself,” wrote the group.

J&J’s blood thinner Xarelto and AstraZeneca’s Type 2 diabetes drug Farxiga are among the 10 drugs that will be subject to price negotiations this year, according to a list unveiled Tuesday by the Biden administration.

Rose, who was appointed by Republican president George W. Bush, owns between $15,000 and $50,000 worth of J&J stock, and shares in AstraZeneca worth up to $15,000, according to his 2022 financial disclosure form. He also owns Moderna stock worth between $15,000 and $50,000, the filing shows.

Until he withdrew on Friday, Rose was the presiding judge in a lawsuit brought in June by the U.S. Chamber of Commerce against the Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid services (CMS). The suit asked the court to rule that for Medicare to negotiate drug prices would be unconstitutional.

The pharmaceutical industry has unleashed a torrent of lawsuits this summer in an effort to strip Medicare of its new powers. Merck, Bristol Myers Squibb, Johnson & Johnson, Boehringer Ingelheim, AstraZeneca and the drugmaker lobby PhRMA have all filed complaints in different districts courts.

Legal experts say the drugmakers are scattering their complaints across the country to increase the odds that the litigation will ultimately end up before the Supreme Court.

Merck CEO Robert Davis confirmed on an earnings call earlier this month that the company plans to take its lawsuit all the way to the high court.

“As we look forward, we’re going to take this to the fullest, which means we’ll take it through District Court and, if need be, into Circuit Court and ultimately to the Supreme Court,” Davis said. “So, really that’s the strategy.”

The Chamber had asked Rose to block the program by Oct. 1, the deadline set for drugmakers to sign agreements to participate in the negotiations.

Primary Road confidence tanking once more, particularly in banks and Biden

As President Biden begins to more forcefully build a reelection case citing Bidenomics, Wall Street forecasts and actual GDP data are supportive, as are recent improving sentiment scores from consumers and CEOs. But on Main Street, small business owners remain a difficult group for Biden to win over.

Small business confidence is back at an all-time low, according to the just-released CNBC|SurveyMonkey Small Business Survey for the third quarter. That’s nothing new for Biden, as small business confidence has hung around a low throughout his presidency. In fact, the latest decline in the confidence index to a score of 42 out of 100 matches the all-time low from exactly one year ago.

With a business owner demographic that skews conservative, the twin economic issues of inflation and rising interest rates have compounded the general concerns about a Democratic administration. But at a time when signs are pointing to progress in the fight against inflation and a potential though by no means certain end to Federal Reserve interest rate hikes, the Q3 data presents more specific — and potentially more troubling — concerns for the president.

Even with a resilient economy, with interest rates at a multi-decade high, the number of small business owners who say they can easily access the capital needed to operate their firms continues to decline, now at under half (48%) versus 53% last quarter. This should not come as a surprise, as higher interest rates make banks stricter when it comes to lending requirements, a dynamic that tends to disproportionately punish small businesses, and linger or even intensify the longer a higher rate environment persists. Even for businesses that can secure loans, double-digit percentage rates are a cash flow challenge.

Data released on Monday from small business trade group NFIB reported similar difficulty among business owners attempting to access capital, with over half (58%) who borrowed or tried to borrow reporting high interest rates as their biggest complaint, and 40% of owners saying interest rates were a significant issue in the ability to access capital.

Wall Street banks and Main Street lending

The latest monthly report from alternative lending firm Biz2Credit from earlier this month shows small business loan approval percentages at banks with over $10 billion in assets at 13.3% in July, an approval rate that has been falling steadily and, pre-pandemic, had been as high as 28.3% in February 2020.

Rohit Arora, CEO of Biz2Credit, noted in a release on his firm’s data that as regulators raise capital requirements at some large banks in the years ahead, steps being taken today to prepare include more hesitancy to lend to smaller companies, since these loans can often range from five to seven years in term length.

Beyond recent concerns about the stability of regional banks, rating agencies say that even the largest Wall Street banks are on downgrade watch, most recently a warning issued by S&P on Tuesday, not a situation in which banks are likely to be more accommodating to the capital needs of small firms, and in fact, the CNBC|SurveyMonkey data recorded a sharp drop in financial system confidence among business owners who work with large banks.

When it comes to accessing capital, small firms that hold accounts with large banks recorded the largest drop quarter-over-quarter, a 10% decline, from 59% saying it was easy for them to access business capital down to just 49% now. That was a much larger decline than among business owners who bank with a regional bank (down 2% quarter over quarter) and those who work with a community bank (down 4%). The largest group of small businesses (41%) conduct their business with large banks.

SurveyMonkey’s analysis of the data pointed to a gap between business owners who express confidence and a lack of confidence in banks that has widened from just 1 percentage point in Q2 (49% confident, 50% not confident) to 9 points now (45% confident, 54% not confident) this quarter.

“These data are a good reminder that the general economy for small business owners can often be very different from the economy that consumers on one side or large corporations on the other are experiencing,” said Laura Wronski, research science manager at SurveyMonkey.

The CNBC|SurveyMonkey Small Business Survey was conducted among over 2,000 small business owners across the U.S. between August 7-August 14.

While concerns across the economy about the banking crisis have lessened since the last quarter, that is not reflected in the conditions that small businesses are facing.

“Banking concerns have become even more top-of-mind for small business owners now, with their confidence in the U.S. banking system weakening and their ability to access needed capital hampered,” Wronski said.

Biden’s business supporters are increasingly negative

The CNBC|SurveyMonkey quarterly confidence index includes a series of core sentiment indicators related to policy that contributed to the decline back to the all-time low, with more small business owners saying they expect immigration policy and tax policy to be a negative. 

That’s notable, according to SurveyMonkey analysis of the results, with these index components that had the largest drag on the overall scores not those tied to hiring or economic conditions, but “two factors that fall squarely within the remit of the president and Congress.”

Business owner expectations for revenue and hiring were largely unchanged, and the percentage that describe economic conditions as “good” changed only slightly, from 40% to 38%. More describe conditions as “middling,” up from 43% to 46% this quarter. But only 15% describe business conditions as “bad.”

“Small business owners seem to be more heavily factoring the political environment into their confidence estimations than the economic environment. The economy has shown promising growth over the last quarter, with fewer concerns about a recession economy-wide now and less immediate threat from a banking crisis,” Wronski said.

In the confidence index scoring, rather than broader survey questions, there was a notable drop for Biden. According to SurveyMonkey, overall approval of the president now matches the same level as Q3 2022 survey, with 31% saying they approve and 68% saying they disapprove of the way Joe Biden is handling his job as president. The small business survey data matches the overall trend in the recent FiveThirtyEight polling average.

But Wronski said, “What’s really surprising is that general confidence among small business owners is falling now for the first time among Biden’s supporters.”

With the overall confidence index back at the all-time low of 42, the gap in confidence index scoring specifically between Biden’s supporters and his detractors is now a record-low 18 points, according to SurveyMonkey (55 versus 37). Among survey respondents who identify as Democrats, the quarterly confidence score declined from 58 to 52, the lowest it has been since Biden became president. Among independents, the decline was from 49 to 42, the lowest it has been among these respondents since the first quarter of 2021. Republican confidence moved the least, declining from a score of 39 to 37.

Biden WH Publicizes $450 Million in New Funding To Save Overdose Epidemic Lives

On International Overdose Awareness Day, the Biden-Harris administration announced more than $450 million in new funding that will help to reduce overdose deaths, support in recovery efforts, crack down on illicit drug trafficking and invest in information campaigns aimed at young people.

The funds will go to strengthen prevention, harm reduction, treatment, and recovery support services. In 2022, over 100,000 lives were lost to overdose.

President Biden declared August 27 through September 2 as Overdose Awareness Week, to focus attention on the damage caused by illicit fentanyl and other drugs. The administration is working to provide funding directly to support city, county, and territorial health departments, which is a first according to their fact sheet provided to PoliticusUSA.

Another example of how the funds will be spent is more than $80 million will go to rural communities in 39 states to fund the distribution of naloxone (an opioid antagonist) to prevent fatal overdose, as well as creating and expanding treatment sites and expand access to behavioral health care for young people.

The funds will also spend nearly 19 million for High Intensity Drug Trafficking Areas programs (HIDTA) to help communities stop drug traffickers and prevent drug related gun crimes.

Read more details here: Overdose Awareness Day Fact Sheet

Fentanyl deaths increased in 2022, though it is a “slowing increase,” which is why the administration says the continued resources are necessary. Senior Administration Officials said the deaths are increasing because supplies are more lethal.

In terms of how bad this crisis is, the CDC says the number of people who died from a drug overdose in 2021 was more than six times the number in 1999, more than 16% from 2020 to 2021, and over 75% of the nearly 107,000 drug overdose deaths in 2021 involved an opioid.

“Behind each of these lives are friends, families, and communities torn apart by overdose,” White House Domestic Policy Advisor director Neera Tanden said on a call with reporters Thursday morning.

As we fight one source of overdoses, a new form pops up to replace the old. The CDC reports from 2020 to 2021:

Opioid-involved death rates increased by over 15%.
Prescription opioid-involved death rates remained the same.
Heroin-involved death rates decreased nearly 32%.
Synthetic opioid-involved death rates (excluding methadone) increased over 22%.

The DEA describes fentanyl as “a potent synthetic opioid drug approved by the Food and Drug Administration for use as an analgesic (pain relief) and anesthetic. It is approximately 100 times more potent than morphine and 50 times more potent than heroin as an analgesic.”

Mixing fentanyl with other drugs, including xylazine, heroin, cocaine and methamphetamine, increases risk of overdose and is sometimes done without the user’s knowledge.

“We know the overdose epidemic is a national crisis,” Second Gentleman Doug Emhoff said on a call with reporters Thursday morning. “Far too many families have lost loved ones, their children, their siblings and their partners and there’s so many more Americans who knows someone that has been impacted by this horrible epidemic. Substance abuse disorders impact families across all of our nation and cities and rural areas red states blue states. In short, this impacts everyone.”

Previously, the administration has spent $83 billion on helping people get treatment, save lives and reach recovery, which is a 42% increase over the previous four years, according to a senior administration official.

What else have they done? “We’ve also put a record number of sanctions on cartels and Chinese companies and individuals, primary source of fentanyl shipping to the U.S. We’ve also had a record number of seizures as well as expansion of treatment with telehealth provisions, which are not accessing health to the most marginalized communities in terms of addiction, people who are in rural communities and communities of color,” a senior administration official reported.

Asked why President Biden isn’t using the bully pulpit more to discourage China, which is a primary source of shipping fentanyl to the U.S., a senior administration official told us, “The fact is that I think this President has been tougher in China in terms of making sure that the illicit actors, the private sectors that are shipping these chemicals are – we’re going after. This is why not only did he expand through an Executive Order the ability to not only go after traffickers, but also the enablers. This includes the amount and number of sanctions that are being placed against Chinese chemical companies and Chinese individuals, in addition to Mexican cartels.”

Biden declared fentanyl trafficking a national emergency in a December 15, 2021 Executive Order.

Later this afternoon, the Administration will host family members who have lost loved ones to a drug overdose to listen and collaborate on efforts to save lives. This is said to be a top priority for the Biden-Harris administration, and we know that President Biden has seen the devastation of drug addiction in his own family. It’s sadly likely that almost everyone knows someone who has been impacted in some way.

The drug overdose epidemic is a national crisis ripping through our families and communities, in addition to posing a national security threat. If you or someone you know needs help, SAMHSA’s National Helpline is a 365-day-a-year treatment referral and information service (in English and Spanish): 1-800-662-HELP (4357).

Hurricane Idalia slams into Florida, heads to Georgia

Hurricane Idalia barreled in southern Georgia after hitting Florida’s Gulf Coast with life-threatening storm surges, leaving at least two people dead and hundreds of thousands without power.

More than 280,000 people in Florida were without power as of early afternoon, according to PowerOutage.US. At least two people died in weather-related car crashes in Alachua and Pasco counties, police said. 

At least 30 of Florida’s 67 counties issued some type of evacuation order prior to the storm. People who did not evacuate should shelter in place, according to the state’s emergency management agency.

Idalia made landfall in the morning as a catastrophic Category 3 storm at Keaton Beach on the Big Bend coast, less than 90 miles southeast of the state capital of Tallahassee. The hurricane has since weakened to a Category 1 storm with maximum sustained winds of 90 miles per hour, according to the National Hurricane Center. 

Idalia is expected to weaken further as it moves inland but will remain a hurricane as the storm moves across southeastern Georgia and southern South Carolina this afternoon or evening, according to the latest forecast. 

Makatla Ritchter (L), and her mother, Keiphra Line, wade through flood waters after having to evacuate their home when flood waters from Hurricane Idalia inundated it in Tarpon Springs, Florida, Aug. 30, 2023.

Joe Raedle | Getty Images

Idalia is expected to become a tropical storm by the time it heads toward the coast of North Carolina on Wednesday night and Thursday, according to the forecast.   

The river gauge at the small town of Steinhatchee on the Big Bend coast surged from 1 foot to 8 feet in an hour, according to the National Weather Service in Tallahassee. Life-threatening storm surges will remain through the afternoon, according to the NWS. 

“Don’t mess with this storm, don’t do anything that’s going to put yourself in jeopardy,” Florida Gov. Ron DeSantis said at a morning press conference.

The Florida National Guard is currently conducting search and rescue operations in Florida’s western coastal counties, said Maj. Gen. John Haas, who leads the force. The Guard is fully mobilized with more than 5,000 service members supporting the emergency response, Haas said at a press conference. South Carolina and Tennessee are sending additional National Guard forces to help with the response, he said.

American Airlines has suspended operations in Tampa; Sarasota; Tallahassee; Gainesville; and Savannah, Georgia, with 167 flights canceled so far. The airline is planning to continue normal operations in Ft. Myers, Key West, Orlando and Daytona Beach.

A truck passes through flooded streets caused by Hurricane Idalia passing offshore in Tarpon Springs, Florida, Aug. 30, 2023.

Joe Raedle | Getty Images

DeSantis said Tampa airport will reopen at 4 p.m. today to incoming flights and fully reopen at 3 a.m.. Gainesville airport will reopen tonight and Tallahassee airport will first thing in the morning, the governor said.

President Joe Biden approved an emergency declaration Monday for Idalia in anticipation of the hurricane making landfall. The declaration allows the U.S. Department of Homeland Security and the Federal Emergency Management Agency to coordinate disaster relief efforts.

FEMA Administrator Deanne Criswell said she will travel to Florida Wednesday, where she will meet with DeSantis Thursday to see first hand how much damage Idalia has left in its wake.

Criswell told reporters during a briefing at the White House that it will take several days to get an initial assessment of how much damage Idalia has done.

Listed below are the Eight trades and three price-target modifications we made throughout a busy week

Traders work during the opening bell at the New York Stock Exchange (NYSE) on Wall Street in New York City on August 16, 2022.

Angela Weiss | AFP | Getty Images

Our portfolio experienced a flurry of adjustments in a week dominated by Nvidia’s (NVDA) quarterly results Wednesday evening and Federal Reserve Chairman Jerome Powell’s Jackson Hole address Friday.

Here’s a day-by-day look at the trades and price-target changes, and what motivated each decision.

TV Stars Who Returned to the Hit Exhibits They Left

After Kim Cattrall‘s shocking cameo in the And Just Like That season two finale, we couldn’t help but wonder: What other major TV stars have returned to the shows that made them famous?

Given Cattrall’s infamous decision not to reprise her iconic Sex and the City character Samantha Jones for a third movie or the first season of its Max spinoff, fans weren’t expecting to see the 67-year-old back in the Big Apple. And yet, Samantha had a small but pivotal role in the Aug. 24 episode, despite not interacting with Sarah Jessica Parker or any of her other former co-stars. 

Samantha made her grand return via a phone conversation with Carrie, calling her old friend to let her know she wouldn’t be able to make her flight from London to New York City to attend “the Last Supper,” a.k.a. the final party Carrie was throwing in her apartment.

Despite not being able to attend the event, Samantha still wanted to pay her respects, asking Carrie to put her on speaker phone. “Thank you for everything,” Samantha said, “you f–king fabulous, fabulous flat.”

Hey, we’ll take what we can get.

China uncommon earths dominance makes U.S. provide chains susceptible

China’s dominance in rare earths makes U.S. supply chains vulnerable, U.S. Trade Representative Katherine Tai said in an exclusive interview Saturday with CNBC’s Martin Soong.

Rare earth metals are used in high-tech products such as electric car motors. Over the decades, China has built up its ability to process the metals — giving it enormous pricing power in a critical global market.

“What I want to draw your attention to is not just the vulnerabilities around China’s investments [overseas], but the fact that China’s dominant position in the world market now in [rare earths] means that it is able to turn on the faucet and turn off the faucet,” Tai said.

“And until we are able to access and create additional supply chains we remain entirely vulnerable to that leverage,” the U.S. trade representative said. Tai was speaking in New Delhi, India, on the sidelines of B20, the official business dialogue forum of the G20.

Tai pointed out that about a decade ago, China raised rare earths prices so high that some U.S. mines were able to operate in the industry again, only to have to close once China cut prices.

The U.S. held a majority stake in the rare earths metals market prior to the 1980s. But lower labor costs overseas, as well as less pressure on environmental standards, helped send the rare earths industry out of the U.S.

Meanwhile, Beijing supported the industry.

“The advantage in terms of China’s dominance isn’t necessarily a natural advantage,” Tai said. “It’s not that they have more rare earths but that they were able to pursue coordinated industrial and trade policies that allowed them to corner the market.”

The Chinese government sets economic plans at least every five years, with some goals — such as boosting self-sufficiency in technology and reaching carbon neutrality — set years earlier in advance.

While such top-down planning isn’t guaranteed to achieve results, the electric car industry has become an example of where Chinese industry has been able to capture significant market share across the supply chain, including the end product.

The level of U.S. reliance on China-based manufacturing came to the forefront during the Trump administration, and accelerated when the Covid-19 pandemic in 2020 disrupted global supply chains. The Biden administration has announced multibillion-dollar initiatives to encourage companies to develop and manufacture critical technologies in the U.S.

“Where we are in terms of our supply chains today is not where we want to be,” Tai told CNBC on Saturday. “We know that we’re vulnerable. Where we want to be is in a place where our supply chains are more diversified, where we have more confidence in them, where we just have more options.”

Australia's trade with China won't return to normal until restrictions are removed, minister says

In the case of rare earths, Tai pointed out that China has a monopoly in the global market. She noted that in the case of Australia’s lithium production, China is also the only buyer — giving Beijing another point of market leverage.

While lithium is a key component of electric car batteries, it isn’t one of the 17 metals scientifically categorized as rare earths.

This year, U.S. and European government officials have talked of de-risking, or reducing the level of dependency on China alone. In a speech to global business leaders in June, Chinese Premier Li Qiang said de-risking is a false proposition because global economic interests are so entwined.

‘Phase one’ trade agreement

Just before the pandemic began, the U.S. and China signed a “phase one” trade agreement which called for China to increase its purchases of U.S. goods as a way to offset the massive U.S. trade deficit with China.

When asked Saturday about where the agreement stands, Tai said the U.S. is still looking at China’s shortfalls in meeting those purchase targets.

She said another aspect to that discussion is the degree to which U.S. trade with China is “imbalanced.”

Official U.S. data said the country’s trade deficit with China rose by 8.3% to $382.9 billion in 2022.

U.S. Secretary of Commerce Gina Raimondo is set to visit China from Sunday to Wednesday, as high-level U.S. official trips to the country have resumed this summer after a lull.

U.S.-India relations

Tensions between the U.S. and China have escalated over the last several years, starting with trade and spilling over into tech and finance.

Many businesses have increasingly started to look for opportunities in India, while the country’s relationship with the U.S. has improved.

On Saturday, Tai also met with India’s Minister of Commerce and Industry Piyush Goyal, and raised concerns about India’s import license requirements for tech equipment, a release said.

“The stars really are aligning between the United States and India and that’s across all of the policy areas,” Tai told CNBC. She described the relationship as “experiencing new heights.”

She said in her area of economics and trade, the potential for working more with India was always there, but previously, “we just couldn’t figure out how to tap it.”

— CNBC’s Samantha Subin contributed to this report.

ADHD drug market faces back-to-school provide pressure

Ten milligram tablets of the hyperactivity drug, Adderall, made by Shire Plc.

Jb Reed | Bloomberg | Getty Images

It’s been 10 months since the Food and Drug Administration first announced a nationwide shortage of Adderall — one of the most widely used medications for attention deficit hyperactivity disorder — and the supply strain could potentially worsen in the months ahead.

While some supply issues have improved, many Americans are still struggling to find and fill prescriptions for the drug and other medications for ADHD that they often rely on to stay focused and complete daily tasks.

Drug-shortage experts told CNBC that it’s extremely difficult to forecast how much longer the shortages will last because of the lack of transparency in the pharmaceutical industry — and some are concerned about market conditions as children, who are commonly affected by ADHD, head back to school. 

“Unfortunately, we might see the shortage worsen. We are heading into back-to-school time, so I am worried about it worsening as we go into that season,” Erin Fox, a pharmacist at the University of Utah and leading expert on U.S. drug shortages, told CNBC.

Adderall is one of more than 300 drugs in short supply in the U.S. as of June, according to a list from the American Society of Health-System Pharmacists, which represents pharmacists in a variety of health-care settings. That list also includes Adderall alternatives like methylphenidate, which is commonly known under the brand names Ritalin or Concerta. 

Adderall and alternative ADHD medications apart from other drugs are Schedule 2 controlled substances. 

That means the federal government regulates how those drugs are made, prescribed and dispensed because they’ve been deemed to have a high potential for abuse and could potentially lead to severe psychological or physical dependence. The designation also means that patients need to get new prescriptions for those drugs every one to three months. 

Millions of Americans in the U.S. use the drugs to help them concentrate, control their impulses and manage their schoolwork, employment or relationships with others. ADHD is usually diagnosed in childhood and often lasts into adulthood.

An estimated 6 million children have been diagnosed with ADHD, and 60% were being treated with medication as of 2016, according to the Centers for Disease Control and Prevention. Meanwhile, around 8 million adults have been diagnosed with the condition, but only about a quarter of that number are getting treatment for it.

Back-to-school supply strain 

Many children and young adults with ADHD often take the summer off medication and primarily rely on it during the school year. That could lead to even more demand in the months ahead that may not be met. 

Historically, prescriptions for ADHD medications increase as the school semester starts around the U.S. — and “there is no indication this year will be different,” according to David Margraf, a pharmaceutical research scientist at the University of Minnesota’s Center for Infectious Disease Research and Policy. 

Some drugmakers have said they expect to resupply a few ADHD products in August or September, according to an FDA database on shortages. But Margraf said “we need to be cautiously optimistic” because drugmakers don’t disclose exact numbers of how much stock they’ll have available by then. 

30mg tablets of Shire Plc’s Adderall XR.

Jb Reed | Bloomberg | Getty Images

That reflects a bigger issue with the ongoing shortages. It’s nearly impossible to know when they will end — or what exactly can be done to resolve them — because of the lack of transparency in the pharmaceutical industry. 

“Very little factual information is out there. I think this is one of the biggest issues,” says Ozlem Ergun, a mechanical- and industrial-engineering professor at Northeastern University and an expert in pharmaceutical supply chains. “When you don’t have transparency or information sharing, how can you understand and resolve a problem that is complex?” 

“This really, really hurts the users and the hospitals and the health-care system. They have pretty much no vision of what the future looks like,” Ergun added.  

Teva Pharmaceuticals, Amneal Pharmaceuticals, Novartis’s planned spinoff Sandoz and Purdue Pharma subsidiary Rhodes Pharmaceuticals, which all manufacture drugs targeting ADHD, don’t need to publicly share information about where they manufacture medications, how much of them they make, where ingredients are sourced and their overall production capacities. 

And the Drug Enforcement Administration — the federal agency that regulates controlled substances — shares little information about the production quotas it sets for each manufacturer of Adderall and other ADHD medications.

The DEA specifically limits the amount of raw ingredients, such as amphetamine, a drugmaker can get to manufacture those drugs.

“We don’t have the quota amount that each company is given. And we also don’t have the amount that each company is actually producing and if they’re meeting those quotas,” said Fox of the University of Utah. “There’s no way to understand which company maybe isn’t doing the job and which companies are, so we just don’t know exactly what’s going on.” 

Production limitations

Ending the shortages of Adderall and other ADHD medications is no easy task.

“It’s not as simple as a free market where you just boost up production and meet demand,” said Michael Ganio, the senior director of pharmacy practice at the American Society of Health-System Pharmacists. 

Many manufacturing plants operate at or near capacity and create multiple drug products. That means increasing the production of one drug could potentially require reducing production — and potentially impacting supply — of another drug, according to Ergun. 

“In general, it is difficult to increase the manufacturing capacity for a drug,” she said. “There isn’t much unutilized capacity anywhere.”

It’s even harder to scale up the production of tightly controlled ADHD medications.

Drugmakers can request for the DEA to increase their production quotas if necessary, but it takes “a lot of push” for the agency to actually approve that, according to Margraf. 

And even if the DEA does approve a quote change, it could take months to do so: “It’s not just flipping a switch and boosting your output by 20%,” ASHP’s Ganio said. 

Members of the Drug Enforcement Administration raided two homes side-by-side, in an assumed illegal marijuana operation, on January 31, 2019 in Commerce City, Colorado.

RJ Sangosti | MediaNews Group | The Denver Post via Getty Images

Some drugmakers have suggested that DEA quotas are contributing to the ADHD medication shortages or making it harder to alleviate them. That includes Aytu BioPharma, which makes an ADHD drug that used to be in shortage. 

In a CNBC op-ed in February, Aytu CEO Josh Disbrow said the DEA could potentially cause widespread drug shortages if it underestimates demand and fails to increase quotas in a “timely manner in response to new information.” 

However, the DEA and FDA pointed to a different problem in a joint letter released earlier this month. 

The agencies said an internal analysis found that drugmakers fell 30% short of meeting the full quota for amphetamine medications in 2022, leaving about 1 billion potential drug doses on the table. They added that there’s a “similar trend” occurring this year. 

The DEA and FDA said they called on manufacturers to confirm they are working to increase production to meet their allotted quotas.

“There’s obviously a lot of finger-pointing going on here between the agencies and manufacturers,” Fox said. 

Surging demand for Adderall

The shortages of Adderall and generic versions of the drug kicked off last August, when major manufacturers reported that their medications were on back-order. 

Manufacturers are required to notify the FDA of a shortage, but not the cause of the interruption. However, the FDA pointed to “ongoing intermittent manufacturing delays” at Teva when it first announced the Adderall shortage. 

Teva previously said the manufacturing slowdown was partly tied to a labor shortage, which was quickly resolved. Teva did not immediately respond to CNBC’s request for comment about the state of its Adderall manufacturing. 

A surge in demand for Adderall and other ADHD medications seems to have played a significant role, too. 

U.S. prescriptions for Adderall rocketed to 41.4 million in 2021, a more than 10% increase from 2020, according to IQVIA, a health industry analytics firm. 

One possible factor sending demand up, according to experts, was the increased use of telehealth services during the Covid public health emergency that may have allowed for more relaxed prescribing standards for ADHD medications.

The pandemic also created a perfect storm of distractions — such as the shift to remote work and a thrum of anxiety, stress and grief over the uncertainty of Covid — that may have exacerbated some ADHD patients’ symptoms or convinced more people that they have the condition, prompting them to seek treatment. 

The increased demand for Adderall amid shortages of the drug likely resulted in a domino effect, too, with health-care providers and patients being driven to turn to alternative medications, triggering shortages of those drugs as well.

CDC expects new photographs to be accessible in mid September

A sign advertises COVID-19 (coronavirus) vaccine shots at a Walgreens Pharmacy in Somerville, Massachusetts, August 14, 2023.

Brian Snyder | Reuters

The Centers for Disease Control and Prevention expects updated Covid vaccines from Pfizer, Moderna and Novavax to be available to the public in mid-September, an agency official told reporters Thursday. 

That amounts to the most specific timeline to date. Federal officials have said the new shots could arrive around September. CDC Director Mandy Cohen had previously provided a later timeline, telling NPR that the vaccines could be available by the “early October time frame.”

Those shots still need approvals from the Food and Drug Administration and the CDC, which will set eligibility guidelines for the jabs. An independent panel of advisors to the CDC is meeting on Sept. 12 to vote on a recommendation for those guidelines. 

Officials from the CDC and FDA said the agencies will encourage Americans to receive an updated Covid shot and other key vaccines ahead of the fall, when respiratory viruses typically begin to spread more widely. That includes the annual flu shot and recently approved jabs that protect older adults and infants from respiratory syncytial virus.

“Our goal, our imperative, our task is to make sure we’re using those tools,” the CDC official said. “Vaccination is going to continue to be key this year because immunity wanes and because the Covid-19 virus continues to change.”

A staff member draws up a syringe with the Comirnaty vaccine from Biontech and Pfizer adapted to the Omicron-BA.1 variant at the Mainz vaccination center.

Sebastian Christoph Gollnow | dpa | Picture Alliance | Getty Images

The arrival of updated vaccines offers some reassurance to Americans as the U.S. sees a slight uptick in Covid cases and hospitalizations. But those metrics remain below the summer peak that strained hospitals last year, the CDC official noted. 

The current surge appears to be fueled by newer strains of the virus like EG.5, or Eris, an omicron subvariant that accounted for 17.3% of all cases as of last week, according to the CDC. 

Pfizer, Moderna and Novavax designed their updated vaccines to target the omicron subvariant XBB.1.5, which is slowly declining in prevalence nationwide. But initial trial data from all three drugmakers suggest the new shots will still protect against EG.5. 

“One of the manufacturers have already made it clear that when testing their vaccine against the EG.5 that it looks like the neutralization is robust,” an FDA official told reporters Thursday. 

But it’s unclear how well the new shots will protect against another new omicron strain of the virus called BA.2.86, which has been identified in a very small number of cases in the U.S., U.K., Denmark and Israel.

“I think it’s too early to know for sure about BA.2.86 in terms of exact data,” the FDA official said, adding that more information will be available in the coming weeks. 

However, the official noted that the new vaccines will likely protect against any severe outcomes from catching the Covid virus.

Last week, the World Health Organization and the CDC said they are tracking BA.2.86 because it has 36 mutations that distinguish it from XBB.1.5. So far, there is no evidence that BA.2.86 spreads faster or causes more serious infections than previous versions. 

CVS Well being, Sandoz companion on low cost Humira biosimilar

Rafael Henrique | Lightrocket | Getty Images

CVS Health is partnering with drugmaker Sandoz to produce a near identical version of the blockbuster arthritis treatment Humira that will sell for 80% below the price of the brand-named drug.

The move is part of the company’s new venture focused on securing, and in some cases co-producing, biosimilar drugs, which are the equivalent of generic versions of complex gene or protein-based therapies known as biologics.

“We’ve invested in committing to certain volumes for the U.S. marketplace so that we have a durable supply of product. We want to ensure that once we bring this into the U.S. marketplace, we don’t have any supply issues, we have a high-quality biosimilar product available, and it’ll be launched at a much lower … price than the originator molecule that exists,” said Prem Shah, CVS Health EVP and chief of pharmacy.

CVS is already one of the leading players when it comes to sourcing generic drugs through Red Oak, its joint venture with Cardinal Health. But it’s looking to strengthen its foothold in the biosimilars market, which is expected to grow to $100 billion over the next six years.

The company said Wednesday it’s launching a new subsidiary called Cordavis, which will specialize in securing supply of the new biosimilar drugs and will partner with Novartis Pharmaceuticals‘ generic manufacturing unit, Sandoz.

Sandoz, currently a unit of Novartis, is expected to be spun off as an independent publicly traded firm later this year.

CVS did not disclose the terms of the agreement for the new biosimilar, trademarked Hyromiz.

The company pledges that the list price of Cordavis Hyromiz will be more than 80% lower than the current list price of Humira, which is made by drugmaker Abbvie. It will launch in the first quarter of 2024.

The first FDA-approved biosimilar for Humira, Amgen’s Amjevita, went on sale in January. Eight more biosimilars are expected to come online within the next year, including Hyromiz.

Amgen executives have said demand for the company’s biologic appears to be growing, but that securing coverage from health insurers has posed a challenge.

“We’re obviously very early innings still in this biosimilar market with Amjevita. And we’re seeing clearly what is new payer behavior in light of such a large product having biosimilar competition,” said Murdo Gordon, Amgen EVP of commercial operations, on the company’s second-quarter earnings call. “The clarity of how pharmacy benefit works with biosimilar uptake, or lack thereof, is becoming clear to us and to other biosimilar manufacturers and other onlookers.”

Abbvie reported more than $4 billion in Humira sales in its most recent quarter, which was slightly better than expected. The company says it continues to be offered on health insurer plans at parity with the new biosimilars.

The launch of Cordavis has long been in the works, before the news last week from Blue Shield of California that it was dropping CVS as its pharmacy benefits manager and switching to Mark Cuban’s Cost Plus Drug Company, Amazon Pharmacy and others in an effort to save on drug costs.

The news sent CVS shares plunging, but analysts like John Ransom of Raymond James say the selloff was overblown. 

At this point, the potential threat from upstarts is not as big as some might fear, especially when it comes to the current biosimilar market for drugs like Humira, Ransom said.

“They either get a big rebate from Abbvie, or they get a big discount from one of the competing biosimilar manufacturers. And that’s really where they have the advantage,” said Ransom.

Cuban’s Cost Plus doesn’t have the scale to buy generic or enough shelf space from the manufacturers, he said.

Correction: CVS Health subsidiary Cordavis will partner with Sandoz on biosimilar drugs. An earlier version mischaracterized the relationship.