Leviathan's Drug Problem from John R. Graham




Executive Summary:

When a pharmaceutical innovator invents a new drug, ready for distribution in the United States, the
federal government responds by enforcing an automatic ban on patients’ use of the drug. Individual
patients can escape this ban only under extraordinary circumstances. The general ban is lifted only
after the manufacturer has paid a user fee and waited for the Food and Drug Administration (FDA)
to undertake a lengthy review to certify the safety and efficacy of the medicine. In 2007, the average
time to remove the standard ban on a new prescription medicine was more than a year, coming at
the end of up to 15 years of research and development.
This ban is implicated in the deaths of about 200,000 Americans annually, which is the mid-point
of a wide range. Evidence going back over three decades supports the conclusion that the lost positive
outcomes—the ones that would have occurred had the government allowed patients and health
professionals to use new drugs faster—overwhelms many times over any decrease in negative health
outcomes resulting from avoiding the harmful side effects of new medicines.
Many believe that this failure is due to a lack of money for the FDA, but this is not the case. Although
other developed countries have similar regulatory burdens, and take about the same time to lift their
bans on new medicines, they approve new medicines with far fewer employees than the FDA does.
With respect to the resources committed to reviewing new medicines in a timely manner, Great
Britain’s regulators are about one-third more productive than the FDA, and other European countries’
regulators are even more productive.
Countries in the European Union have implemented a policy of regulatory competition, where a
central regulator and national regulators compete for user fees that they charge manufacturers to
lift their bans on new drugs. When one regulator has lifted its ban on a new medicine, all the other
European countries must generally reciprocate by lifting their bans. This regulatory competition
benefits European patients. (However, many Europeans suffer another delay that Americans do not,
because their governments also impose pharmaceutical price-fixing bureaucracies as well as regulatory
agencies between patients and doctors, which the U.S. does not.)
Therefore, Congress should amend the Food, Drug, and Cosmetic Act to allow Americans to use new
medicines once a regulator in a comparable jurisdiction, such as the European Union, has removed
its prohibition. The FDA would retain the power to compel manufacturers to label their medicines
with the warning that the FDA has not approved their safety or efficacy...