A Better Way to Approve Drugs

In this paper, Avik Roy examined drug development in four major public health areas and discovered that for any given drug on the market, typically 90 percent or more of that drug’s development costs are incurred in Phase III trials. The current Phase III trial system forces pharmaceutical and biotechnology companies to take enormous financial risks and burdens them with needless and unpredictable regulatory delays. It prevents start-up biotech companies from challenging the dominance of large, multinational pharmaceutical concerns. It also, perversely, encourages more innovation in drugs for very rare diseases than it does in drugs for common conditions that afflict hundreds of millions of Americans.

Roy recommends allowing drugs that have been found safe and promising (in Phase I and Phase II clinical trials) to win approval for limited marketing to patients. This would give patients early access to innovative new therapies, while the FDA would retain the ability to collect information confirming the drugs’ safety and effectiveness and to revoke a drug’s marketing authorization later, when appropriate.

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