Health, Public Safety FDA Reform, Pharmaceuticals, Policing, Crime Control
April 23rd, 2014 1 Minute Read Report by Alexander Tabarrok, Christopher-Paul Milne, Joseph A. DiMasi

An FDA Report Card: Wide Variance in Performance Found Among Agency's Drug Review

The United States Food and Drug Administration (FDA) reviews and must ultimately approve any new drug as "safe and effective" before it can be marketed for sale in the United States. The question of whether the agency is too cautious in its reviews (delaying access to critically needed treatments), or too fast in issuing approvals (potentially exposing patients to undetected risks from new products), has long been a subject of public debate.

This study attempts to provide a more objective examination of the FDA's performance by examining disparities in review and approval times across 12 review divisions within the FDA's Center for Drug Evaluation and Research (CDER). After reviewing nearly 200 products accounting for 80 percent of new drug and biologic launches from 2004 to 2012, the authors find wide variation in division performance. In fact, the most productive divisions (Oncology and Antivirals) approve new drugs roughly twice as fast as the CDER average and three times faster than the least efficient divisions—without the benefit of greater resources, reduced complexity of task, or reduction in safety. The authors estimate that a modest narrowing of the CDER divisional productivity gap would reduce drug costs by nearly $900 million annually. The worth to patients, however, would be far greater if the agency could accelerate access to an additional generation of (about 25) drugs. Greater agency efficiency in approving a single generation of drugs would be worth about $4 trillion in value to patients, from enhanced U.S. life expectancy. To reap such gains, this study encourages Congress and the FDA to more closely evaluate the agency's most efficient drug review divisions, and apply the lessons learned across CDER. We also propose a number of reforms that the FDA and Congress should consider to improve efficiency, transparency, and consistency at the divisional level.



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