When Rep. Henry Waxman, D-Calif., wants to get new drugs into the hands of patients quickly and cheaply, he knows just what to do--waive some or all of the Food and Drug Administration's clinical trial requirements.
In 1984, legislation he championed waived the requirement that all "regular" generic drugs had to be clinically tested for safety and efficacy. In 2009, he is trying to do this again with a bill that calls for the same standards to apply to another category of generic drugs that wasn't included in the original Hatch-Waxman law.
To save money for consumers, Waxman is willing to allow certain drugs, called biologic drugs, to enter the market without clinical testing that proves their efficacy. He realizes that requiring clinical testing for efficacy will slow things down and needlessly keep important drugs out of the hands of suffering patients.
But by that same principle, he should favor repealing that requirement for all new drugs. Just as his proposal would get drugs into patients' hands more quickly and create more competition, so too would a wholesale repeal of the efficacy requirement save lives and create more competition. The case for repealing the efficacy requirement for regular drugs, moreover, is just as strong as the case for repealing such requirements for biologic knockoffs.
Congress gave the FDA the power to ensure drug safety in 1938. But how did the requirement to show efficacy come about? Ironically, it was the result of an incident that had nothing to do with efficacy: the thalidomide tragedy of the early 1960s. With the Kefauver Amendment of 1962, Congress gave the FDA the power to ensure that a drug is effective too.
One can argue that the FDA should keep unsafe medicines off the shelves. But the efficacy argument is more of a stretch--because the market already does such a good job of determining efficacy.
Do you need a government agency to tell you which TV has a vivid picture? Do you need a government agency to tell you which car is reliable? How about which coffee tastes yummy or which MP3 player is attractive and easy to use? No, you don't. And that's because through your experiences and the experiences of those around you, including consumer groups and enthusiasts, efficacy is discovered in a decentralized, efficient way.
The same thing happens in medicine, but it's actually a more scientific, rigorous and well-developed process. Doctors, hospitals and patients see what works for them. Even when not forced to do so by the FDA, pharmaceutical companies often find it advantageous to run well-designed, expensive and lengthy clinical trials to show efficacy. Government agencies and universities also run clinical trials. Medical groups, managed-care organizations and insurance companies codify and use treatment guidelines. Individual physicians make names for themselves by analyzing medicines and writing scientific papers.
What is the harm in giving the FDA the power to exclude new drugs until they have proved effective? Plenty. Approximately 35% of drug development costs are for safety testing, while 65% are for efficacy testing. Because of this, good drugs are being delayed or not developed at all. One of us (Hooper) has helped kill drugs for brain cancer, ovarian cancer, melanoma, hemophilia and other important conditions--not because they weren't good drugs, but because the anticipated clinical development costs were greater than the anticipated financial returns. (See an earlier story, "Obama And The 'Drug Killer.")
Traditional drugs are small molecules made through chemical reactions; a chemist can attest, for example, that the 21 atoms of
Waxman's H.R. 1427 bill recognizes that the drugs will be different, and the Federal Trade Commission agrees in its June 2009 report, Emerging Health Care Issues: Follow-on Biologic Drug Competition, which says: "Unlike small-molecule generic drugs, FOB [follow-on biologics] products will not be designated as 'therapeutically equivalent' with the pioneer biologic drug product. The lack of therapeutic equivalence means that, like pioneer manufacturers, FOB manufacturers will have to market their products and negotiate individual contracts with purchasers."
Waxman hasn't forgotten safety for biosimilars. H.R. 1427 mandates safety testing, requiring "(i) information derived from chemical, physical, and biological assays, and other non-clinical laboratory studies; and (ii) information from any necessary clinical study or studies sufficient to confirm safety, purity and potency." But H.R. 1427 does not require clinical testing to prove efficacy and, in fact, states, "Any studies under clause (ii) shall be designed to avoid duplicative and unethical clinical testing."
So in a break with the 1962 drug law, H.R. 1427 would allow the FDA to approve new, unique drugs without any proof of efficacy. These drugs will be similar to existing drugs, but will they have 150% or 50% of the efficacy of the original drugs? No one knows. But the market will ascertain this anyway through its normal process.
Waxman says that's OK--and we agree with him. If it's reasonable to jettison efficacy requirements for biologic knockoffs, then it's just as reasonable to eliminate them for all new medicines. That's the best way to get new, safe medicines to patients in need quickly and inexpensively.
David R. Henderson is a research fellow with the Hoover Institution and an economics professor at the Naval Postgraduate School. He was formerly the senior economist for health policy with President Ronald Reagan's Council of Economic Advisers. Charles L. Hooper is president of Objective Insights, a company that consults for pharmaceutical and biotech companies, and a visiting fellow with the Hoover Institution.