The Food and Drug Administration (FDA) appears to be a do-good institution committed to the protection of public health and safety. After all, there are a lot of greedy people out there trying to sell you something harmful and run with your money. If a company makes a dangerous drug, we need someone to step in and make sure no unsuspecting citizens buy it, right?
The real world is more complicated. If the FDA only blocked deceptively marketed or harmful drugs, there wouldn’t be a problem. Unfortunately it also delays life-saving drugs and raises their costs, with deadly consequences.
According to a study by researchers at Tufts University, adjusted for inflation, the average cost of developing a new drug rose from $1 billion in 2001 to $2.6 billion in 2016. Increased FDA requirements are responsible for a significant portion of that cost, though it’s difficult to pinpoint exactly how much. We do know that since 2001, the number of regulatory requirements the FDA imposes on clinical trials and drug development has increased by nearly 3,000.
Only 9.6% of new candidate drugs are ultimately approved by the FDA, according to the Biotechnology Innovation Organization. This means that the cost of getting a single drug to market has to include the research and development costs for nine others that failed. The FDA also imposes hundreds of costly regulations on the clinical trial process.
Delays and increased costs reduce research on new cures. A company won’t develop a new drug unless it has a good chance of receiving FDA approval and generating more than $2.6 billion in revenue. Many potential drugs, which could have improved the lives of thousands or even millions, have not been developed as a result of these limitations.
Higher development costs also lead to higher drug prices, since the increased cost of developing a new drug is passed on to the consumer in the form of higher insurance and prescription costs. FDA regulations are a significant cause of America’s high drug prices.
A $2.6 billion average development cost also means no one without $2.6 billion can even consider trying to develop a drug. This leads to fewer organizations competing to develop new medicines, which compounds the problems of innovation and affordability.
It’s difficult to know how many new drugs are never developed for lack of investment money or expected profit, but a look at antibiotic development is instructive. The number of new FDA-approved antibacterial agents decreased by nearly 90 percent between 1980 and 2012, according to the FDA’s Center for Drug Evaluation and Research.
Some of this is due to the intrinsic difficulty of discovering new treatments, but some is due to regulations such as the FDA’s ever-increasing clinical trial requirements to demonstrate effectiveness to the agency’s satisfaction. In some cases, the FDA has even changed the requirements in the middle of a company’s clinical trial, forcing the addition of new patients and other adjustments midstream.
There are also more concrete ways to observe the often-deadly effects of the FDA’s restrictive policies. Paramount is the average of nine years for FDA drug approval according to a study from the Journal of Health Economics. Before the FDA regulated clinical trials, required efficacy tests, and had its time constraints lifted, it took roughly seven months to get a drug approved.
If a company develops a new drug to treat, say, kidney cancer, approximately 130,000 people will die from kidney cancer during the nine-year period when the drug exists but hasn’t been approved. Even if the drug has only a 1 percent chance of saving a patient’s life, that’s nearly 1,300 people who will die from the disease. Conservative estimates for the number of people who have died under such circumstances are in the hundreds of thousands. There are also several million patients whose lives could have been prolonged, or whose suffering could have been mitigated by a drug delayed by the FDA.
In 2017, the FDA approved the drug Ocremizulab, a treatment for multiple sclerosis (MS) that began its FDA approval process in 2009. It reduces MS symptoms by 40 percent compared to the previous best drug on the market, based on clinical trial data. About 400,000 people suffer from MS in the US.
If you were a family member of one of those 400,000 people, and you knew Ocremizulab existed, how would you feel about the FDA keeping it from your loved one for eight years? Shouldn’t a patient and their doctor be able to decide for themselves if they want to try a new drug? The FDA instead takes a paternalistic approach and prevents patients and doctors from making their own medical decisions.
I’m not trying to imply that the FDA has nefarious goals; even with the best of intentions, the FDA’s organizational incentives are to go slower and require more testing. If a drug that turns out to be harmful makes its way through the approval process, the victims are identifiable and the FDA and its staff will be blamed.
On the other hand, the people who could have been helped by new drugs that don’t get developed or that take extra years to get to market don’t even know they’ve been harmed. FDA’s staff could want nothing but the best for the public, and the organization would still trend inevitably toward excessive caution and delay.
In 1962, Congress expanded FDA’s powers to include proof of efficacy requirements and extensive regulation of clinical trials, and eliminated constraints on how much time FDA could take to review drugs. Before 1962, the worst example of a patently unsafe drug making it to market and killing people was the Elixir Sulfanilamide tragedy, in which 107 people died from a toxic antibiotic. Compare this and accidents like it to the thousands who die every year because the FDA hasn’t yet approved the drug that could save their life, or because the FDA prevented that drug from being invented in the first place.
So where does that leave us? Even if there are some unintended consequences of the FDA’s policies, is the alternative to let companies sell whatever drugs they want? Of course not.
In a world with reduced FDA power, companies would still be liable for falsely advertising dangerous products. Drug companies would still take safety seriously, as they already do and as they did before the FDA was authorized to regulate clinical trials. It is possible that some people might be harmed by new drugs, but many times more would be saved.
It’s scary to imagine a world where no one is guarding the gateway from the lab to the medicine cabinet, but that is a false choice. The real question is where to strike the balance between additional information about safety and effectiveness and more rapid availability of lifesaving medications.
FDA’s current powers and incentives draw the line too far on the side of precaution, unnecessarily driving up costs and slowing innovation, resulting in needless additional suffering or death for millions.