Friday, August 06, 2004
Dual-tracking for drugs could save lives
[Bartley J. Madden, "Breaking the FDA Monopoly," Regulation, Summer 2004.]
The FDA has been rightly taken to task for its slow approval process for new drugs. The result is people in need of new treatments who are unable to access them. At the same time, fear of the the possible consequences of dangerous side effects keeps any significant reform from taking place. In this recent piece in The Cato Institute's journal Regulation, a solution is proposed that may bridge the divide:
Most Americans rarely encounter the Food and Drug Administration and consequently are not alarmed by its significant growth over the last few decades. Congress has facilitated fda expansion by using well-publicized episodes of unsafe products to promote pro-expansion legislation and by allowing a silent but inexorable proliferation of fda regulations.
On top of that, the news media feed Americans a steady diet of examples that purportedly cry out for increased government regulation of unsafe products and environmentally damaging behavior. What does not get reported is that every expanded piece of the fda’s bureaucratic machinery is matched by a loss of consumer choice.
The nature of the fda is to strive at any cost to prevent individuals from acquiring a drug that might cause serious harm or early death. Such occurrences generate widespread criticism and turn up the political heat on the fda. The agency has been largely successful in that effort, but the significant costs of that prevention have received only limited attention. One such cost is the economic loss to society in the form of higher prices, in order to offset the hugely expensive clinical trials (on both failed drugs and approved ones) and for new drug applications. A second significant cost to society is from time delay before useful drugs become available to those who would benefit from them.
I propose to end the fda monopoly on market access to drugs and medical devices. I believe a “second track” could be opened for consumers to access those products — a track that would allow informed consumers to purchase drugs that have undergone only the initial phase of the fda drug-approval process. By opening this second track, patients would have access to potential miracle drugs after those drugs have passed their Phase I safety tests, while the fda could continue the Phases II and III tests that examine the drug’s efficacy.
Dual-tracking offers three compelling benefits:
- The Internet could be used to inform consumers about potentially useful drugs that have not undergone Phases II and III of the fda testing. Consumers electing
to obtain those drugs could be kept up-to-date on findings from the subsequent fda clinical trials.
- The results experienced by “second-track” consumers would constitute a feedback mechanism, putting the spotlight on the fda’s costs from time delays for new drugs and the benefits from putting those drugs through the rigorous three-phase trials.
- New data obtained from consumers who use the second track and from their doctors could supplement the fda’s conventional analyses of clinical trials. A prerequisite to a free-market economy is a set of rules that facilitate transactions in which both buyers and sellers mutually benefit. Such transactions generate information used for continually directing resources toward their most valued uses. In the dual-track drug-approval process, buyers and sellers must specify their joint responsibilities in legally binding contracts.
Many readers might consider my proposal to be quite radical, but it simply returns us to the fda’s role prior to 1962: certifying that a drug is safe. In that era, the determination of how well the drug worked was left to patients and their doctors, i.e., to “the market.” Thus, the key component of my proposal was accepted in the United States until 1962. And no evidence has ever been provided that post-1962 testing for both safety and efficacy has produced aggregate benefits in excess of aggregate costs (inclusive of opportunity costs).
Dual-track drugs would generate needed feedback data for evaluating the overall benefits versus overall costs of the post-1962 efficacy requirements. Little doubt exists that under the status quo, society would continue to benefit from the ongoing approval of safe medicines that are incrementally more effective than existing treatments. Of great consequence is the currently unknowable cost to society from delays in making revolutionary medicines available and from abandoned innovations because of costs associated with the whole process. Dual-tracking not only holds the promise of providing faster access to paradigm-shifting, innovative drugs for improving health and saving lives, but it also would inform voters and politicians as to whether the fda needs to be restructured for more effective twenty-first century medicine.
Higher-income, early users of dual-track drugs would not be buying government-guaranteed safe and effective drugs. They would be buying a reward/risk package having the potential for health improvement but also carrying a higher risk of worse outcomes than from fda-approved and insurance-paid drugs. Those consumers’ willingness to be informed risk takers with their own health and money is a prerequisite for faster health improvements and for reforming the fda. Just as the general economy benefits from risk takers among us, general health care would be improved from having dual-track drug risk takers.
[Bartley J. Madden, "Breaking the FDA Monopoly," Regulation, Summer 2004.]
The FDA has been rightly taken to task for its slow approval process for new drugs. The result is people in need of new treatments who are unable to access them. At the same time, fear of the the possible consequences of dangerous side effects keeps any significant reform from taking place. In this recent piece in The Cato Institute's journal Regulation, a solution is proposed that may bridge the divide:
Most Americans rarely encounter the Food and Drug Administration and consequently are not alarmed by its significant growth over the last few decades. Congress has facilitated fda expansion by using well-publicized episodes of unsafe products to promote pro-expansion legislation and by allowing a silent but inexorable proliferation of fda regulations.
On top of that, the news media feed Americans a steady diet of examples that purportedly cry out for increased government regulation of unsafe products and environmentally damaging behavior. What does not get reported is that every expanded piece of the fda’s bureaucratic machinery is matched by a loss of consumer choice.
The nature of the fda is to strive at any cost to prevent individuals from acquiring a drug that might cause serious harm or early death. Such occurrences generate widespread criticism and turn up the political heat on the fda. The agency has been largely successful in that effort, but the significant costs of that prevention have received only limited attention. One such cost is the economic loss to society in the form of higher prices, in order to offset the hugely expensive clinical trials (on both failed drugs and approved ones) and for new drug applications. A second significant cost to society is from time delay before useful drugs become available to those who would benefit from them.
I propose to end the fda monopoly on market access to drugs and medical devices. I believe a “second track” could be opened for consumers to access those products — a track that would allow informed consumers to purchase drugs that have undergone only the initial phase of the fda drug-approval process. By opening this second track, patients would have access to potential miracle drugs after those drugs have passed their Phase I safety tests, while the fda could continue the Phases II and III tests that examine the drug’s efficacy.
Dual-tracking offers three compelling benefits:
- The Internet could be used to inform consumers about potentially useful drugs that have not undergone Phases II and III of the fda testing. Consumers electing
to obtain those drugs could be kept up-to-date on findings from the subsequent fda clinical trials.
- The results experienced by “second-track” consumers would constitute a feedback mechanism, putting the spotlight on the fda’s costs from time delays for new drugs and the benefits from putting those drugs through the rigorous three-phase trials.
- New data obtained from consumers who use the second track and from their doctors could supplement the fda’s conventional analyses of clinical trials. A prerequisite to a free-market economy is a set of rules that facilitate transactions in which both buyers and sellers mutually benefit. Such transactions generate information used for continually directing resources toward their most valued uses. In the dual-track drug-approval process, buyers and sellers must specify their joint responsibilities in legally binding contracts.
Many readers might consider my proposal to be quite radical, but it simply returns us to the fda’s role prior to 1962: certifying that a drug is safe. In that era, the determination of how well the drug worked was left to patients and their doctors, i.e., to “the market.” Thus, the key component of my proposal was accepted in the United States until 1962. And no evidence has ever been provided that post-1962 testing for both safety and efficacy has produced aggregate benefits in excess of aggregate costs (inclusive of opportunity costs).
Dual-track drugs would generate needed feedback data for evaluating the overall benefits versus overall costs of the post-1962 efficacy requirements. Little doubt exists that under the status quo, society would continue to benefit from the ongoing approval of safe medicines that are incrementally more effective than existing treatments. Of great consequence is the currently unknowable cost to society from delays in making revolutionary medicines available and from abandoned innovations because of costs associated with the whole process. Dual-tracking not only holds the promise of providing faster access to paradigm-shifting, innovative drugs for improving health and saving lives, but it also would inform voters and politicians as to whether the fda needs to be restructured for more effective twenty-first century medicine.
Higher-income, early users of dual-track drugs would not be buying government-guaranteed safe and effective drugs. They would be buying a reward/risk package having the potential for health improvement but also carrying a higher risk of worse outcomes than from fda-approved and insurance-paid drugs. Those consumers’ willingness to be informed risk takers with their own health and money is a prerequisite for faster health improvements and for reforming the fda. Just as the general economy benefits from risk takers among us, general health care would be improved from having dual-track drug risk takers.
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