‘The Avastin Mugging’

by John R. Graham

The Wall Street Journal has run a devastating editorial on “The Avastin Mugging.” The paper’s editorial board rightly challenges the FDA’s Oncology Drug Advisory Committee (ODAC) for threatening to take away breast-cancer patients’ right to use Avastin. The editorial also cites disturbing evidence that ODAC’s reviewers considered not just safety and efficacy but price, which is not within the FDA’s mandate.

However, the $88,000 annual cost that the editorial cites as “reflecting the costs of development and production” neglects an important component of pharmaceutical costs — complying with the regulatory burden of the FDA!

I recently published a study based on decades of research that leads to the conclusion that even a one-year delay in legal access to the many new medicines available costs about 200,000 American patients their lives. Congress believes the solution is to throw more money at the FDA, which it did via the 1992 Prescription Drug User Fee Act (PDUFA). Under this regime, renewed every five years, the number of personnel conducting drug reviews doubled, from 1,300 to 2,600, between 1992 and 2007. Last year, the agency as a whole exceeded its hiring targets. The FDA’s spending on the regulation of human drugs in 2009 was $802 million, and the president’s 2011 budget demands $1 billion, an increase of 20 percent over two years.

Despite such growth, the FDA is slowing down. In 2008, the average time to approval lengthened to almost 18 months from just 12.3 months the previous year. The FDA drives up the cost of innovation then uses the high cost of innovation as an excuse to punish innovators by requiring them to jump every higher regulatory hurdles.

That bureaucratic feedback loop may be good for the FDA but is certainly harmful to patients who need new medicines sooner rather than later.

Critical Condition

NRO’s health-care blog.