Feb
27
2007

Drug prices and FDA testing

With all the buzz in the news about new vaccines and other drugs and whether or not they're properly tested for safety and efficacy, I was totally intrigued with an article in the December 18, 2006, issue of The New Yorker: "The Right to a Trial: Should dying patients have access to experimental drugs?" (Jerome Groopman)

The whole topic was fascinating, but the article included a summary of the F.D.A. approval process:

"Guaranteeing drug safety has been part of the [Food and Drug Administration's] mandate since 1938, when Congress passed the Federal Food, Drug, and Cosmetic Act after more than a hundred people died from taking a medicine for strep throat which contained diethylene glycol, an active ingredient in antifreeze. Today, the vast majority of patients with life-threatening diseases are treated with drugs that have been approved by the F.D.A. after a stringent evaluation process designed to insure they are safe and effective. It typically takes a pharmaceutical company six and a half years from the time it discovers a promising molecule to gather enough data to apply to the F.D.A. for permission to test a drug on patients. Completing the clinical trials requires, on average, another seven years: an initial set (Phase I), usually involving fewer than a hundred patients, to determine the maximum tolerated dose and likely side effects; a second set (Phase II), involving several hundred patients, to identify the diseases—or stages of a disease—that are affected by the experimental therapy; and a final set (Phase III), in which the drug is given to several thousand patients and compared with another drug that has already been approved by the F.D.A., or with a placebo. After the trials, the F.D.A. reviews the results and, usually in consultation with an advisory panel of experts, decides whether to approve an experimental drug. Drug companies pay most of the costs of clinical trials, and by the time a drug reaches the market the manufacturer will have spent nearly a billion dollars on its development.

Nearly ninety per cent of drugs that enter Phase I trials are eventually abandoned because they are shown to be unsafe or ineffective. (Last week, Pfizer announced that it was canceling its Phase III trial of torcetrapib, an experimental drug for heart disease, after eighty-two patients in the study died. Pfizer had spent almost a billion dollars on torcetrapib, whihc had shown exceptional promise in earlier trials. 'This drug, if it worked, would probably have been the largest-selling pharmaceutical in history,' Steven E. Nissen, the chairman of cardiovascular medicine at the Cleveland Clinic, told the Times.) In the past decade, the number of new drugs approved by the F.D.A. has fallen sharply. According to a recent article in the Journal of the American Medical Association, between 1994 and 1997 the agency approved an average of nearly thirty-six new drugs a year, but between 2001 and 2004 the approval rate averaged just twenty-three a year."

It's kind of mind-blowing. And it explains why drug companies do so much lobbying and marketing directly to patients.

I also found a cool article in the Federal Reserve Bank of Boston's Regional Review, Quarter I, 2003: "Too Much of a Good Thing Can Be Bad." (Carrie Conaway). It's about the development of cholesterol-lowering drugs, which are among the top-sellers in the US, but it touches on the same issues:

"The cost and uncertainty of the drug development process mean that pharmaceutical firms need to receive large returns on any successful drug in order to counterbalance the failures along the way. Yet the products they make, once discovered, are extremely easy for other firms to copy. Without some kind of legal right to the economic returns from their research findings, pharmaceutical companies would have no incentive to develop new drugs—and society would miss out on the new and improved treatments for disease and illness that the companies would discover. To solve this problem, the government grants drug manufacturers patents—short-term monopolies that limit competition and thus help ensure that companies receive a return on their research. But this benefit to inventors comes at a social cost. The shield from competition that patents provide gives manufacturers the economic power to set prices higher than competitive markets would allow, on the very goods that society regards as critically important to make available.

There is no doubt that patents foster innovation, especially for pharmaceuticals. But it is harder to know whether their current structure has struck the right balance between their costs and benefits for society."

What do you think IS the right balance between pharmaceutical costs and their benefits to society? Does FDA licensing make you feel okay about the safety and efficacy of a drug? Do you think that drug prices are fair? What could we do differently?

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