FASTER FDA CURES
October 13, 2006
The Food and Drug Administration (FDA) does a pretty good job managing "the central speed-safety trade-off" involved in drug approvals -- and might even do well to move faster, according to a report by the National Bureau of Economic Research (NBER).
The authors looked at 662 drugs approved between 1979 and 2002, a period that included the passage of the 1992 Prescription Drug User Fee Act that allowed drug companies to help fund the FDA budget in exchange for faster reviews. They found that the resulting modest gains in drug review times have produced unambiguous public benefits:
- In monetary terms, the authors estimate that the law improved consumer welfare by as much as $19 billion.
- But more importantly, they found that more rapid access to beneficial drugs saved between 180,000 and 310,000 "life-years."
- By contrast, assuming that every risky drug withdrawn in that period was the fault of the Prescription Drug User Fee Act produces an upper-bound estimate of only 56,000 life-years lost.
The upshot of the economists' report is that the Prescription Drug User Fee Act deserves reauthorization. But the evidence also suggests Congress should probably be looking for other ways to make FDA approvals still faster. Despite the high-profile Vioxx panic, the FDA is far more likely to kill by depriving you of a drug than allowing you to take a dangerous one, says the Journal.
Source: Editorial, "Faster FDA Cures," Wall Street Journal, October 13, 2006; and Tomas J. Philipson et al., "Assessing the Safety and Efficacy of the FDA: The Case of the Prescription Drug User Fee Acts," National Bureau of Economic Research, Working Paper No. 11724, October 2005.
For NBER study:
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