U.S. Senate Republican Policy Committee - Larry E. Craig, Chairman - Jade West, Staff Director

July 22, 1997

Costs Go Up, Access Goes Down: What’s Wrong With this Picture?

First, Fix What’s Wrong at FDA

Since 1938, Americans have placed their trust in the federal Food and Drug Administration to act on new products that can improve their health, and to protect them from unsafe or ineffective products. The public trust and support given to this federal agency must be based on Americans’ belief that the agency does more good than harm. However, mounting evidence shows that current FDA policy is badly broken, and in need of fixing.

The Real Costs of FDA’s Current Practices

Dr. Louis Lasagna, director of Tufts University’s Center for the Study of Drug Development, estimates that the seven-year delay in the FDA’s eventual approval of beta blocker heart medicines cost the lives of 119,000 Americans.

• During the three-and-a-half years it took the FDA to approve the new drug Interleukin-2 (IL-2), 25,000 Americans died of kidney cancer even though the drug already had been approved for use in nine other countries. According to Eugene Schoenfeld, a cancer survivor and president of the National Kidney Cancer Association, "IL-2 is one of the worst examples of FDA regulation known to man."

In 1985 the National Heart, Lung and Blood Institute of the National Institutes of Health stopped a study comparing a genetically engineered clot-busting drug called TPa because the study showed that TPa was so effective in reducing heart attack-related deaths that it would be unethical to withhold it from volunteer patients. Yet it took the FDA four years to approve the drug, despite the NIH decision. That delay cost 30,000 lives.

The generic anti-cancer drug Flutamide was available in Europe for years and was proven safe, but the FDA failed to approve it. According to Dr. Bruce Chabner, director of the National Cancer Institute’s Division of Cancer Treatment, "We’re talking about delays of years." Subsequently the National Cancer Institute accused the FDA of being "mired in a 1960s philosophy of drug development, viewing all new agents as . . . poisons."

More Costs, More Delays

Since the early sixties, the total time from discovery of a drug to FDA marketing approval has nearly doubled. Even worse, approvals of cutting-edge life-saving technology dropped by nearly 80 percent in 1992, from the numbers of the mid-1980s. Regulatory delays and demands for enormous amounts of clinical data is estimated to have driven up the cost of developing and marketing new drugs by more than $359 million in 1993. Shortening these delays and reforming current testing standards would save lives and reduce the cost of developing new drugs and life-saving technology.

Drugs Available Overseas First — According to the CATO Institute, of 150 new drugs and vaccines approved by the FDA between 1990 and 1994, 61 percent were available overseas before they became available in the United States.

• Getting Approval Takes More and More Time — In addition to the lack of new drugs, cutting-edge life-saving technology has been all but lost in the regulatory maze put forth by the FDA. Makers of medical devices from band aids to dialysis machines are required to apply to the FDA for approval. The CATO Institute finds that between November 1991 and November 1992, products pending before the FDA for more than 90 days rose from 2 to 713. The average review time hit 200 days in 1993 and 216 days in 1994. More complex devices averaged an approval time of 823 days in 1994.

Fewer Products Approved — Requests to approve new medical devices dropped from 79 in fiscal year 1990 to 43 in 1994. While 72 new medical devices per year were approved in the mid-1980s, the number fell to 12 annually by 1992 before increasing somewhat in recent years, according to Jeffrey Pierce of Citizens for a Sound Economy.

Longer Delays for New Drug Uses — While the FDA approves a drug for a particular treatment, doctors are permitted to prescribe it for other uses. However, the FDA strictly prohibits advertising of these "off label" uses. A study by the Center for the Study of Drug Development at Tufts University, as reported in the March 11, 1997 Investor’s Business Daily, found that between 1989 and 1994, the FDA took more than two years, on average, to approve these "off label" advertising applications — longer than it took the agency to approve brand new drugs.

Get it Fixed Before Starting Anew

In short, the FDA’s perplexing, costly, and time-consuming regulations often have imposed costs outweighing the benefits of delay. These costs are not just economic but result in human suffering and even death. At a time when the FDA is being considered for new regulatory authority and enforcement, isn’t it time to fix what’s broken first?

[NOTE: Examples cited on page one are taken from the 1997 CATO Handbook for Congress.]