FDA’s new policies threaten innovation

Zeal has replaced science and common sense at the Food and Drug Administration.

Last year, the FDA attempted to block importation of “electronic cigarettes” -- an important aid to cessation of smoking -- but was enjoined from doing so by the federal courts. It also reversed a sound policy that required prior legal review of warning letters sent to companies, and it has increased the amounts of data that will need to be obtained and submitted to regulators for medical devices -- including pacemakers, artificial joints and cardiac stents -- to an extent that threatens innovation in the industry.

Another unwelcome development is an increase in the kinds and amounts of “user fees” that companies must pay just to get the FDA to review their applications. They are nothing more than a discriminatory tax on pharmaceutical companies which will ultimately be passed along to patients. It’s akin to having to tip the DMV staffer to get him to renew your car registration. Seven-figure user fees are inconsequential to big drug companies but can be debilitating to drug start-ups and device companies, many of which are small and cash-poor.

The agency is even extending its authority beyond statutory limits. The Federal Food, Drug and Cosmetic Act requires, for example, that for a drug to be marketed, it must be shown to be safe and effective. But the agency has invented new criteria that include a demonstration of superiority, which it applies arbitrarily.

Proving that a drug is better than existing drugs often is much more difficult and vastly more expensive than just proving that it is safe and effective, because if two medicines’ efficacy differs only marginally, the clinical trials must be very large in order to attain statistical significance. Moreover, even if two drugs are both found to be effective in 40% of patients, they may not be effective in the same 40%. If this new criterion is widely implemented, many drugs useful for some patients will founder, reducing competition in the drug market and causing prices to rise.


Wyeth’s then-chairman and CEO, Robert Essner, described the implications of the requirement to show superiority this way: “If you’re the first company to get approved in a certain area and competitors can’t get on the market, the FDA is now establishing monopolies. And that’s certainly not their mandate.”

In the latest example of heightened risk aversion, the FDA is reportedly rethinking a long-standing and successful policy that permits nongovernmental “accredited persons” to perform reviews of certain low- or moderate-risk medical devices. Such a revision, if approved, would be part of the trend toward more stultifying, expansive and expensive regulation that is slowing innovation and endangering developers of drugs and medical devices -- to the detriment of patients.

The 13-year-old U.S. policy is a more limited, more conservative version of one that has worked effectively for decades in the European Union, where oversight of medical devices (as well as many other consumer products) relies heavily on product standards. In the U.S., products such as blood pressure cuffs, wheelchairs, root canal filling resins and various kinds of scopes used to visualize joints and other structures may be reviewed by accredited persons.

This third-party route for clearance is about 33% faster than for similar applications that go directly to the FDA, and these applications are not subject to user fees. Arguably, instead of terminating third-party review of certain medical devices, the program should be expanded to include at least some drugs.

A model for the evaluation of clinical data by independent reviewers already exists: In a two-year pilot program (1992-94), the FDA contracted out to a nonprofit technical consulting company, Mitre Corp., reviews of applications (called “supplements”) to extend or revise new drug approvals. These evaluations were then compared to in-house analyses. In all five of the supplements reviewed by Mitre, the recommendations were completely congruent with the FDA’s own evaluations. Moreover, the time required for the reviews was two to four months, and the cost ranged from $20,000 to $70,000 -- fast and cheap compared to federal regulators.

Although not final yet, the move to eliminate the third-party policy is not surprising. No matter how efficient or effective it may be, the outsourcing of regulatory functions is wildly unpopular among bureaucrats because it shrinks their budgets and challenges the myth of their unique abilities. And since the arrival of President Obama’s political appointees in leadership positions, the FDA’s risk aversion and stringency of regulation have noticeably increased.

The FDA is in dire need of adult supervision, but its political and congressional masters appear to be leaving the bureaucrats to their own devices.

Henry I. Miller, a physician and molecular biologist, is a fellow at Stanford University’s Hoover Institution. He was an FDA official from 1979 to 1994.