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LE Magazine August 2002

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New Website Speaks Out on
FDA's Unhealthy Policies

The cost in terms of human suffering and economic loss that stems from the FDA's failed policies is too high. That's why Daniel Klein, Ph.D. and Alex Tabarrok, Ph.D. decided to pool their knowledge and develop a website (www.FDAReview.org) that provides a meticulous dissection of the FDA's multiple troubles.

by Angela Pirisi

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After pouring over academic and medical literature on FDA policy for years, Drs. Klein and Tabarrok could reach only one conclusion: "The FDA greatly increases the costs of drug development and the time it takes to bring a drug to market. The net effect is loss of health and life." The website, they hope, will help to present the facts, inconsistencies, injustices, and help advance the public debate on FDA reform. It traces federal drug regulation back a century, details the steps involved in drug development and approval, presents an evaluation of the costs and benefits of FDA policy. Klein and Tabarrok also size up the major plans for FDA reform, and offer their own solutions for getting out of the current quagmire of misguided policies bred by what they deem excessive caution.

The thrust of Klein and Tabarrok's argument is that while it may seem like a good idea to have empowered the FDA to make sure only safe and effective drugs come onto the market, it doesn't work well in practice. Fearful of scandal and criticism, the FDA has focused so hard on keeping some "bad" drugs from making it to the marketplace that, in so doing, it has also prevented or delayed many more good drugs from reaching Americans. It seems to be a calculated risk for the FDA, since potentially good drugs that never see the light of day receive a lot less media attention than harmful drugs that are exposed, suggest Klein and Tabarrok.

"The FDA was established in a fitful series of ill-considered responses to highly-publicized tragic events, particularly the sulfa tragedy in 1937 and the thalidomide disaster. Let's accept, for the sake of argument, that the FDA has helped to avoid some tragedies of this sort," says Klein. "Nevertheless, you still have to do the grisly math. How many lives have been lost because the FDA delayed a life-saving drug? How many lives have been lost because FDA regulation made it unprofitable to develop a new life-saving drug? How many lives have been lost because the FDA refused to allow advertisers to make scientifically supportable health claims? When you do the grisly math it isn't even a close call. The FDA is a major health catastrophe."

What the FDA considers choosing the lesser of two evils may not be unlike throwing the baby out with the bathwater. Consider, say Klein and Tabarrok, the headlines that pop up when drugs that have FDA's stamp of approval do grievous harm to some people. In 1994, they cite, an estimated 106,000 or more people died from adverse reactions to "safe" FDA-approved drugs. On the flip side, pulling drugs off the market for doing harm to some people may be doing a disservice to many others, who can no longer benefit from that drug because the FDA paints all patients with the same brush. "In fact," says Tabarrok, "the FDA is probably too quick to withdraw products from the market. Many drugs are safe for most people but seriously dangerous for a few, and it can be very difficult to discover this in clinical trials. Suppose that a drug is deadly to one out of every 5,000 patients. It would be very difficult to discover this statistically even in a large and expensive clinical trial of say 10,000 patients. These sorts of problems can only be discovered once the drug is approved and prescribed to hundreds of thousands of people. Unfortunately, there is sometimes no substitute for experience. Life's like that." Using the example of chemotherapy and warfarin (blood thinner that's also commonly used as rat poison), Klein and Tabarrok suggest that all drugs are equivocally good and bad, depending on who's using them. So, subjecting drugs to a "guilty until proven innocent" trial basis may be arbitrary if, in the end, only widespread use in real-life patients offers true proof of a drug's efficacy and safety.

The problem-FDA as permission grantor

Part of the trouble, complains Klein, is that, "People conflate FDA permission with medical validation or certification. By mixing legal matters such as government permission with real medical matters, the present regime might actually be confusing people. If drugs weren't banned till permitted, but rather permitted till banned, the situation would be less complicated. Then the FDA would be merely a drug certifier, not a permission grantor. You'd be free to try whatever therapies you chose. So, contrary to what people might suppose, in fact, discussion and negotiation of your medical options might proceed in a more informed-not less informed-way." Says Tabarrok, "The simple fact is that the FDA restricts the freedom of patients and their doctors. Individuals certainly have better incentives to look after their own health than does the FDA. The real question then comes down to information-does the FDA possess a big information advantage that enables it to make better choices for individuals than individuals would make for themselves? This is why we spend time at FDAReview.org explaining and evaluating the rich constellation of voluntary institutions and practices that help patients to make good choices even when their information is imperfect. Patients don't choose alone but with the help of agents and advisors, such as doctors, hospitals and pharmacists. [These individuals and entities] have access to information in the scientific literature, drug evaluation service(s)-such as the USP Pharmacopoeia-information from ECRI and UL, which evaluate and test medical devices, and so forth. Putting all this together, we see little grounds for believing that the FDA offers a valued service." Besides, Tabarrok adds that the FDA may pride itself on having the best and most rigorous standards in the world for drug approval, but patients in Europe don't hold their breath about U.S. FDA drug approval before using a new drug their doctor prescribes.

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How vigorous is the FDA approval process anyway, and how relevant is it when there are so many off-label uses for FDA-approved drugs? The fact is that the drugs [it] approves based on small study populations, in reality, are prescribed to a much bigger, non-homogenized group for reasons other than those that were tested. That goes to show how much stock both U.S. doctors and patients put into the "FDA-approved" stamp. "Actually, when people are sick, what they really put stock in is the approval of their doctor, their hospital, and so on. Most cancer and AIDS patients, for example, are prescribed drugs for an off-label use-that is, a use for which the drug does not have FDA efficacy certification," explains Tabarrok. "And any doctor who limited himself to FDA-approved prescriptions would be giving his patients inferior service and could easily be sued for negligence."

The long, twisted road to market

As it is, people may suffer long into a debilitated state, or even death, before a viable drug therapy for their disease or condition ever reaches their pharmacy. One of the leading problems symptomatic of the FDA's unhealthy policies is "drug lag." An example of this is the recent approval (May 2001) for enhancing infant formula with two vital fatty acids, AA and DHA, which can improve the brain and eyes of young children. While it's a welcome decision for American parents and pediatricians, Klein and Tabarrok point out that the FDA falls far behind other countries, such as Britain, Japan, Israel, Belgium, the Netherlands and more than 50 other countries, where enriched infant formula has been available, in some cases, even more than five years. Moreover, back in 1994, the World Health Organization recommended that all infant nutrition products be enhanced with AA and DHA in the same quantities and proportions as occur naturally in breast milk.

But the excruciatingly long delay that precedes new drugs being okayed isn't the worst of it, since drug lag also reduces the total number of new drugs created, otherwise known as "drug loss." The FDA has long rested easy knowing that it is painfully difficult to measure the amount of drug loss or its health consequences, and that the public is none the wiser about treatments that could have been but never will be. In rare cases where the public has been aware, however, there have been strong patient outcries to have their medicine back. On the web site, Klein and Tabarrok cite the example of Latronex, a short-lived drug indicated for irritable bowel syndrome, which was removed from the market after 70 users developed a serious side effect, and three deaths were possibly linked to the drug. Yet they remark that the hundreds of people who found relief in Latronex without suffering adverse reactions were outraged when the FDA snatched away this new therapy from everyone. "The example of Latronex indicates how the FDA's 'one size' policy can harm many patients," says Tabarrok. "The FDA could better serve all patients if, instead of making don't-take-it choices on behalf of patients whom it can't know or understand, it collected and disseminated information that helped doctors and their patients make informed choices in the context of the patients' lives. That way the FDA would respect the uniqueness of each patient's conditions. Treating consumers with respect is a better policy than paternalism, both medically and ethically."

FDA needs a new prescription

To date, the FDA has made some efforts to address the issues at hand, but Klein and Tabarrok say these are modest at best. For example, the FDA has been responding to some pressure to speed up drug approval with their "Fast Track" program, which is meant to shorten the time, and thereby reduce the cost of getting drugs to market. But how much of a difference will it actually make? Probably not much, says Tabarrok, who describes the program as one step forward, two steps back. "The FDA has hired more reviewers in recent years thanks to the User Fee Act of 1992, which has reduced the time it takes the FDA to review applications," he explains. "But at the same time, the FDA has asked for more and longer clinical trials. In 1980, the typical drug underwent 30 clinical trials involving about 1500 patients, but in more recent years the typical drug has had to undergo more than 60 clinical trials involving nearly 5000 patients." The result? The total time from discovery to approval is still around 12 to 15 years, and the average cost of getting a new drug to market is now 800 million dollars with no sign of dropping. "The FDA responds to critiques by pointing to the decrease in review times under Fast Track," says Tabarrok, "but astute observers will keep their eye on the total costs and time of getting a drug to market."

"The problem can't really be solved by a new wrinkle or FDA goodwill," he adds. "What's needed is substantial reform that alters the structure of power. Klein and Tabarrok have some suggestions of their own.

Give knowledge and power to the consumer

Why not redefine the FDA as a trusted advisor and evaluator of medical drugs and devices, whose goal would be to inform patients "rather than to dictate and constrain their choices"? Historically, the FDA has resisted the free flow of medical information down to the consumer, a perfect example of the tight-lipped policy today that perpetuates the tradition of prescription labels that provide almost no patient information. "Even today, consumers typically don't receive a copy of the product label with their prescription," says Tabarrok. "If they're lucky, their pharmacist may give them a computer-generated synopsis of warnings and contraindications. Consumers can and should ask for product labels with their prescriptions. The FDA should also pay more attention to designing labels that can be easily read and understood." Another strategy to empower consumers would be for the FDA to allow split labelling on all drugs and medical devices, so that drug manufacturers could list FDA-approved claims down one column, and those that have "not been evaluated by the Food and Drug Administration" down another. The split-label approach would mean that all of a drug's common uses are described on the label, including off-label uses.

Make the FDA a certifier of drug certifier

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Establishing a group of nongovernmental drug-certifying bodies would encourage healthy competition for contracts from pharmaceutical companies developing new drugs. Such a free market proposition would create incentive to be thorough, accurate, expedient and cost-effective. And, unlike the FDA, the certifying bodies would be liable to litigation for negligence. While hired drug-certifying bodies would oversee the initial review and evaluation of proposed new drugs, the FDA would ultimately decide whether to certify a drug or not. But it would be expected to do so within a 90-day review period, and failure to respond in this timely manner would constitute automatic approval. Similarly, the FDA would have to provide a written explanation of why it has rejected an application, and drug companies would be able to appeal the FDA's decision through an independent committee of experts.

Draw on other countries

One of Klein and Tabarrok's primary suggestions for FDA reform is establishing drug-approval reciprocity with countries that have a proven record of approving safe drugs, such as most western European countries, Canada, Japan and Australia. This would help the U.S. to speed up the drug approval process, eliminate duplication and wasted resources, and focus, in a more expedient manner, on the review and investigation of new drug applications. Also, international reciprocity would eliminate the FDA's monopoly on drug approval by allowing U.S. drug companies to seek approval from drug authorities in partner countries.

Refocus on drug safety only

Given the many off-label uses of FDA-approved drugs, which speaks to efficacy evaluation being performed by other institutions, why not focus strictly on proof of safety? "That would greatly expand the range of drugs developed (in particular for rare diseases), increase the speed with which they get to market, and significantly reduce costs and drug prices," suggest Klein and Tabarrok.

Make FDA approval optional

Klein and Tabarrok believe that when the FDA grants permission to allow drugs into the marketplace, it's not "approval" so much as the lifting of a ban, since anyone who uses, prescribes, produces or sells a drug prior to FDA approval is prosecuted under the full weight of federal law backing FDA policy. But why not make FDA drug testing and certification optional? Klein and Tabarrok suggest having in its place voluntary practices, individuals and institutions, such as reputation, knowers and middlemen, which assure quality and safety because it is profitable to satisfy the consumer and live up to one's promises. That would make the FDA only one of several certifying bodies specializing in testing drugs and medical devices.

Daniel Klein, Ph.D., is Associate Professor of Economics, Santa Clara University; Alex Tabarrok, Ph.D., is Research Director at The Independent Institute and Editor of Entrepreneurial Economics: Bright Ideas From The Dismal Science. To view their new web site, log on to www.FDAReview.org


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