A Slow Year For FDA Drug Approvals
1 CommentBy Ed Silverman // August 8th, 2008 // 8:01 am
Somehow, you are not surprised, are you? In any event, the FDA has so far approved nine new medicines as of the end of June, putting it on pace to be one of the slowest years for new drug approvals in the last five years, Dow Jones reports.
The agency approved 18 “new molecular entities,” which means the active ingredient hadn’t been used before in an FDA-approved therapy, in 2007. The agency could approve a similar amount if its pace continues. The agency approved 22 drugs in 2006. This year’s approvals include Wyeth’s Pristiq, used to treat depression, Cephalon leukemia drug Treanda and UCB’s Cimzia for Crohn’s disease.
FDA spokeswoman Sandy Walsh tells Dow Jones the agency may approve more, or fewer, drugs in the second half of the year, but it can be difficult to predict because the agency reviews drugs as they come in and some may require more time than others. “It’s not like we’re trying to race through and get 20 done this year and 18 next year,” she says, adding that applications “come in on a rolling basis and we approve them on a rolling basis.”
Kim D. Slocum
Let’s be honest, there are at least two different issues working here. On one hand, the FDA is clearly more concerned about safety and is taking more time to ensure approvals won’t come back to bite them via Congressional investigations or really bad PR later on. The second issue is less obvious but probably more important. Industry’s no longer submitting the the sort of NDA for “best in class” products to treat common chronic diseases that represented a significant portion of every major firm’s portfolio 8-10 years ago.
Why is this second phenomenon occurring? Because in an world of tiered co-payments (and now co-insurance) industry can’t get third party payers to reimburse for them and most consumers don’t have the money to pay premium prices for pharmaceuticals out of pocket. If you can’t sell it, why go to bother of developing and submitting it for FDA approval in the first place?
Now what we see are firms trying to hit home runs every time by slanting their portfolios toward the sort of “breakthrough” compounds everyone agrees they want but are very technically challenging to discover and develop. If one looks at the historical record, it is unusual to find a year in which more than 2-3 true breakthrough products get approved.
Where we wind up is with pipelines full of specialty products for cancer all of which the developers presume will command five-figure to six-figure annual price points if/when approved. Unfortunately, this “bubble” is also showing signs of bursting in the near future as payers develop even more elaborate cost shifting benefit designs.
The answer to this problem lies in working with payers to develop better documentation of value for novel biopharmaceuticals. There is still an attractive market for the common chronic diseases, it’s just not in the first line therapy that produced the “blockbusters” of the 1990s. Identifying segments of patients likely to fail low cost first-line treatments and developing benefit designs that ensure no access barriers exist for these individuals is at least as important to improving industry R&D productivity as anything firms do back in the laboratory.