NCPA - National Center for Policy Analysis

When Regulators Make Defensive Decisions

June 19, 2002

Flawed government regulations can discourage innovation and delay introduction of lifesaving products.

Here's how that process works, using the Food and Drug Administration as an example.

The regulator can make two kinds of errors: by approving a harmful product, or disallowing a beneficial product. While the consequences of approving a harmful product receive great publicity that may threaten the regulator's career, withholding approval for a potentially beneficial product draws little attention.

So regulators develop a built-in bias against innovation, because approval involves a risk that denial doesn't.

Advocates of this theory point to several recent cases to make their point.

  • Wyeth-Ayerst Laboratories had developed and tested under then-prevailing FDA rules an injectable antibiotic, Tigecycline, to treat infections by antibiotic-resistant bacteria -- but the FDA changed its rules to require a doubling of the number of patients in trials from 4,000 to 8,000.
  • With only the final trial left to go, the company put its tests on hold and is considering -- because of the added costs -- whether to proceed with development.
  • The FDA has denied approval of a vaccine to prevent meningitis C, which infects thousands of patients and kills hundreds in this country annually, even though three excellent products are available in Canada and Europe.
  • But the FDA won't recognize foreign approvals, even though there is supposed to be a goal of reciprocity among international regulators.

Source: Henry Miller (Hoover Institution), "Dying for Regulation," Washington Times, June 15, 2002


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