Landmark legislation designed to alert consumers to where their drugs were made is headed for a full Senate vote, but safety experts say the transparency bill has been stripped of two of its most critical provisions.
The Clear Labels Act was introduced earlier this year by Sens. Rick Scott, R-Fla., and Kirsten Gillibrand, D-N.Y., after lawmakers and drug safety experts called for more transparency in the industry. Last year, a ProPublica investigation revealed that the U.S. kept importing generic drugs from foreign factories after inspectors had identified quality and safety lapses at the sites, including leaks, mold and contaminated water.
Medications made at these facilities were linked to thousands of reported adverse reactions in patients.
The bill aims to allow doctors and patients to see on the label exactly where a medication was made — details that had largely been withheld until now, even from Congress. Current generic drug labels often include only the location of the packager or distributor, which can be thousands of miles away from the actual manufacturer.
One provision made the law particularly strong, experts said: The label was supposed to include a unique code that the Food and Drug Administration uses to identify factories. That code would have made it easier for researchers and the public to track the regulatory histories of specific facilities.
The requirements also were supposed to take effect as early as a year after the bill’s passage.
Senators have now struck both of those provisions. People familiar with the deliberations said lawmakers worried the requirements would raise drug prices and weaken national security by revealing the precise locations where lifesaving medications are made.
The unique identifier requirement has been removed from the bill, and the timeline for companies to come into compliance was extended to five years.
“It’s just a clear watering down of the original bill,” said retired Army Col. Vic Suarez, a former medical supply-chain commander who has been leading a push for more domestic pharmaceutical manufacturing.
He and others also questioned why drug companies need multiple years to comply.
“Five years after it passes might as well be a lifetime,” said Dr. Kevin Schulman, a professor of medicine and health policy at Stanford University who has researched the economic pressures that lead to poor-quality generic drugs. “Why is it that the supply chain, the medical distributors and the retailers don’t want to make sure that they supply the highest-quality product?”
In a joint press release, Scott and Gillibrand praised the bill’s progress in the Senate, calling it a “massive win for consumer safety and transparency,” but did not address the changes.
A representative from Gillibrand’s office said the five-year delay is meant to give the FDA time for rulemaking, which is a complicated, often yearslong process used to introduce new regulations. The delay would also give manufacturers time to come into compliance and redesign their labels, the representative said.
But Peter Baker, a former FDA inspector whose work involved the very companies impacted by the bill, said that amount of time is unnecessary.
“If they wanted to do it in one year, they could,” Baker said. “I would love to hear their justification on why they need five years to develop some rules and guidance on transparency. … I mean, it’s a simple label change.”
The new version of the legislation also removes the key requirement to include a unique facility identification number on labels, called a DUNS number, which would have allowed the public to more easily trace a generic drug and its active ingredients to the factories where they were made. In some cases, that identifier could also be used to find FDA inspection reports that describe contamination and other safety breakdowns on factory floors.
ProPublica used that ID number to collect data for Rx Inspector, a first-of-its-kind tool that allows consumers and doctors to look up where more than 40,000 generic drugs are made. Pharmacists and patients are already using the tool to learn more about the drugs they take and prescribe.
Under the bill’s updated language, drug labels will only be required to include factory addresses, which can be inconsistent and hard to trace to a manufacturing facility. A single address in India, for example, can house multiple factories, each producing its own drugs, or each with a slight variation on the same address.
ProPublica reporters ran into this issue when collecting data for the Rx Inspector tool. In 69% of prescription drug labels, reporters found a generic drug manufacturer’s DUNS number and were able to directly connect it to a specific facility. However, when only a manufacturer’s address was available, linking a drug to a particular facility became much harder, requiring a complicated process of automated address verification, geolocation and extensive manual review.
Experts also worried about certain language in the legislation that could allow manufacturers to avoid identifying where their factories are at all. Representatives for the bill’s sponsors have said that manufacturers are required to identify the factory where drugs were made, but the legislation only mentions a “place of business.” Drugmakers could potentially list the address for their headquarters or a subsidiary location in the United States rather than a factory overseas.
“If, in fact, ‘place of business’ can be interpreted as the location of the importer or the headquarters or something like that, it would be no different than what we have today,” said Ohio State University professor John Gray, who testified before the Senate Special Committee on Aging, led by Scott and Gillibrand.
“Then we’ll be right back to where we are,” Gray said. “It’ll say ‘Manufactured for So-and-So in New York City,’ but it’s actually made somewhere else around the world.”
“Paper Trail” Podcast
Learn more about this story on ProPublica’s podcast “Paper Trail.”
People familiar with negotiations over the bill’s language said they are confident that manufacturers won’t have a loophole. The changes to the bill were primarily made as a compromise between committee offices and stakeholders, they said, and the FDA will have final say in what counts as an acceptable address.
The Association for Accessible Medicines, the generic drug lobbying group, did not respond to multiple requests for comment. A spokesperson for the association previously spoke out against the bill to ProPublica, saying the additional requirements would cause “significant costs in exchange for limited return.”
The lobbying group spent over $1 million between January and July on healthcare and generics-related bills, including the Clear Labels Act, according to its public filings.
The trade group for brand-name manufacturers did not respond to a request for comment. Previously, a spokesperson for the brand-name trade group said the industry would “welcome conversations about how to strengthen the biopharmaceutical supply chain.”
The bill faced pushback from some lawmakers on the Senate Committee on Health, Education, Labor and Pensions. Sen. Maggie Hassan, D-N.H, raised the national security concerns, and Sen. Rand Paul, R-K.Y., said he worried about creating an additional hurdle to drug production.
Ultimately, the revised bill passed the committee in July, with only Paul dissenting. The full Senate is set to take up the measure; a date has not yet been scheduled.
Congress will work with the FDA to make sure the law is properly interpreted and enforced, according to those familiar with the negotiations.
Baker said the burden of ensuring compliance will fall to already-overworked inspectors, who will be forced to determine whether manufacturers are skirting the address requirement. It would be easier to require the unique identifier, he said, because inspectors could more easily verify the information.
“The more flexibility they allow, the more complex it is to enforce it,” Baker said.
Baker also pushed back against concerns about a potential national security threat. He said data about where U.S. drugs come from is already well known, so including factory information on labels wouldn’t pose a significant risk.
“It’s a public health concern over a national security concern,” he said. “I would say that those risks outweigh the national security concerns.”
