IV Fluids Shortage: Background
Since early 2014, there has been a purported IV fluids shortage that has created increased demand and an evolving increase in costs. Baxter and Hospira, holding 90% of the $1.2 billion market, have reported trouble with manufacturing. The FDA and FTC are currently investigating both companies for price-gouging and market suppression, suspecting they have maintained a short supply to keep their prices and margins elevated.
Most recently, Baxter claims that production lines were disrupted due to hurricanes and inclement weather. Hospira has not publicized any substantive explanation at this time.
Prior to the “shortage” onset in 2014, a liter of normal saline – the mainstay of IV fluids – cost around $3. Following the shortage, prices increased 200% to 300% depending on the fluid type and supplier. Supply had somewhat stabilized as of the end of 2016. But, as early as April of 2017, Hospira and Baxter were both reporting forecasted shortages without an adequate explanation.
IV Fluids Shortage: Discussion
Both Baxter and Hospira, as well as the few other companies that produce IV fluids, are responsible for the IV fluids shortage. Adequate production line upscaling could have been accomplished in the three years they have reported intermittent shortages. Both of these giant companies are responsible to the American public for shorting availability of supplies. Both companies are responsible, it seems, for prioritizing greed over benevolence.
Current evidence supporting this position includes subpoenas from the U.S. Federal Trade Commission’s antitrust division to Baxter and Hospira executives, served both in April 2017 and October 2017. The FTC is asking both companies to explain why there is a shortage of something so simple to make (sterile water with added sugar, salt, or electrolytes in various amounts). Both company’s executives have stated they are willing to provide an answer and maintain that a primary contributing factor was the weather.
The reason weather has, apparently, played such a big role in reducing supplies is that Baxter and Hospira both produce IV fluids, as well as other medications and supplies, in Puerto Rico and Central America. Why not here in the U.S.? It is definitely cheaper to produce these supplies out of the country. However, there is risk involved – case in point the current and ongoing weather-related shortage. The more insidious risk, however, is the potential loss of these billion-dollar production facilities and the capacity to produce what we need at home if the weather was any worse.
This is a stupid position to be in. It’s not ignorant – they knew better. But, their intelligence limited their planning and execution to include low margins and high revenues. Can we fault them for that? We do live in a capitalistic society where that very axiom is valued. We need to decide as a society that we can blame them. Every business should remain solvent while also providing their employees with rewards for investment returns and successful risk-taking. However, any business that accomplishes this by providing a necessary and life-sustaining service to the public-at-large also must be bound to an ethical code which prioritizes benevolence over greed.
The evidence that Baxter and Hospira maintained short supplies to buff margins and revenue is deduced from a three-year intermittent shortage of IV fluids where no reasonable effort was made to ensure that such a life-sustaining product would never be in shortage again. Greedy and stupid.
I’m Jason Hazard and this is my opinion. Thanks for reading.
Jason Hazard is a former contributing reporter for the Washington Post and New York Times.
He is a prepper and he gives a damn.