David R. Henderson and Charles L. Hopper recount a real horror story in the Wall Street Journal.
On April 27, the FDA rejected Arcoxia (etoricoxib), a new COX-2 inhibitor from Merck. The FDA explained that it didn’t see the need for another drug like this. Robert Meyer, director of the FDA’s Office of Drug Evaluation II, told reporters that, “simply having another drug on the market” wasn’t “sufficient reason to approve the product unless there was a unique role defined.”
The FDA is supposed to judge whether a drug is safe and efficacious and that’s all. In its literature, the FDA even agrees with this role, saying that, “Once a new drug application is filed, an FDA review team — medical doctors, chemists, statisticians, microbiologists, pharmacologists, and other experts — evaluates whether the studies the sponsor submitted show that the drug is safe and effective for its proposed use.” But the FDA slyly added a third requirement: Is Arcoxia better than what’s currently on the market?
According to the law, this isn’t part of the FDA’s approval process and for three good reasons. First, it would be difficult and expensive to show, before it’s marketed, that a new drug is better than all competing drugs. It already costs on average just shy of a billion dollars to get a new drug approved. A study by Joseph DiMasi, an economist at the Tufts Center for the Study of Drug Development in Boston, found that the cost of getting one new drug approved was $802 million in 2000 dollars ($956 million in 2007 dollars). Most new drugs cost much less, but his figure adds in each successful drug’s prorated share of failures. And this $1 billion figure was before the FDA dreamed up this new requirement.
The fact that we’re talking about drugs often causes us to forget what we know about other products whose safety and efficacy are important. We shouldn’t. Imagine that Saturn had to prove that its new car, Aura, is safe, works well, and is better than Accord and Camry before a single Aura hits the showroom floor. If the evidence is too costly for Saturn to collect, Aura will be rejected regardless of the facts. To prove superiority, what manner of tests would Saturn run? How much would this cost and how long would it take? What if five years later Saturn presented its evidence and, on some attributes Aura was better, on some it was equal, and on some it was worse than Accord and Camry? Is it a better car?
There’s no right answer. It would be better for some drivers and not as good for others. But there doesn’t need to be a right answer. This is the second reason drug companies don’t have to prove their drug is better than existing drugs. People are capable of choosing the cars that best meet their specific needs. Faced with this situation, however, the hypothetical federal agency regulating cars would probably say, as the FDA did with Arcoxia, “Why do we need Saturn’s Aura when we’ve already got Honda’s Accord and Toyota’s Camry? The Camry and Accord are fine cars.” Hasta la vista, Aura.
I found the statement “It already costs on average just shy of a billion dollars to get a new drug approved” really horrifying. Can you imagine how many drugs must be abandoned because there is not a sufficient market for the individual item to justify development costs on that scale? Be sure not to get a rare disease, Americans.