Mort Zuckerman
http://www.NewsAndOpinion.com | So many emotions collide as we take our daily pills. There is gratitude that our maladies can be treated so easily and efficiently with medication. But feeling better, we fret about the cost. Then, suspicions fester that the pharmaceutical industry must be taking too much in profit. It isn't, in fact. The real cause for anxiety, instead, is that bringing new drugs to market costs so much and takes so long that more and more Americans are being deprived of hard-won advances in medical science.
The drug companies face tough times for two reasons. First is the cost of clinical trials required by the Food and Drug Administration. Today, roughly 40 percent of the $30 billion the 20 top drug companies spend on research and development goes to clinical trials. Second, the profits to meet such costs are being eroded because their patents are expiring. Patents for mechanical instruments extend for generally 18 to 20 years; for drugs, patents have a life span of just 12 to 14 years. That's because patent licenses begin when a new drug is registered, before it can win FDA approval and start earning back its investment.
And approval is hardly a given. Eight of the top 15 drug companies did not get the go-ahead for a single drug last year. In 1980, drug companies spent some $2 billion on R&D, and 34 new drugs were approved. Last year, the drug companies spent close to $30 billion, but only 24 drugs were approved. It is costing lots more, in other words, to get much less. And even those drugs given the all clear by the FDA don't pay their way. Seven of 10 of the drugs approved by the FDA never make enough money to even justify their development costs.
This is no small issue. Getting through all the phases of clinical trials typically required for approval of a new drug can run anywhere from $300 million to $800 million. No wonder the drug companies want to improve the process. Drug costs, it is true, are increasing by about 18 percent a year. But only 4 percent is due to price increases. The rest is the result of replacing older, more invasive, expensive, and less effective medical treatments-a tradeoff, in other words, of modest cost for better medicine.
Faster, smarter. The FDA reviews are essential, but they must be better managed. Given that the agency still lacks a new chief, it exhibits the tendency in every bureaucracy without leadership: Its first priority is to avoid problems. Yes, some biotech companies present sloppy and incomplete drug applications to the FDA. And yes, such applications routinely run to 100,000 pages or more. But the fact remains that the process for bringing new drugs to market has become much too long and cumbersome. Information requests from the FDA often lack clarity, and the level of technical expertise of FDA reviewers sometimes falls short. The result? Since the 1960s, the approval time for new drugs has increased from approximately eight years to more than 14, dramatically increasing the cost of each new pill that comes to market. That's just not right. The FDA and the drug companies must find ways to reduce the period from synthesis of a new drug to its sale to consumers-without sacrificing quality. In Europe, this process is much faster and efficient. That's why some of the best new drugs today are available abroad but not here.
How to fix a system so obviously broken? For starters, the FDA must raise salaries and hire additional reviewers. It makes no sense to increase the budget of the National Institutes of Health by $2 billion with the purpose of encouraging new drugs while leaving the FDA's budget inadequate to review these drugs for qualification. In fact, what this does is threaten to bog down the review process even more.
Democrats in the Senate are unwilling to approve anybody for the FDA's top job who has any experience with the drug industry. This is just shortsighted. There are plenty of people in the drug industry who understand the process and have the ethics to be fair-minded and objective. In fact, it is an understanding of this process that makes a background in the drug industry such a big plus. That kind of knowledge would allow a new FDA chief to accelerate the reviewers' work without diminishing the quality of their reviews. Ted Kennedy, the chairman of the Senate committee now objecting to an industry designee, might recall that his father, Joe Kennedy, was appointed the first head of the Securities and Exchange Commission precisely because he understood how the financial markets worked.
The costs of a mandated clinical-trial process should, as a matter of
fairness, be reflected in the cost of the drugs approved. But it is
important to all of us-pill takers today and tomorrow-that the
pharmaceutical companies maintain sufficient profitability to sustain the
pace and quality of the advances that have made such an enormous
difference in the quality of life of so many
JWR contributor Mort Zuckerman is editor-in-chief and publisher of U.S. News and World Report. Send your comments to him by clicking here.
04/15/02: Israel's endgame will impact the free world
03/21/02: In the face of pure evil
03/14/02: A man on a mission
03/07/02: Land of the Sinking Sun
02/12/02: Speaking truth about energy
01/15/02: Putting our house in order
01/12/02: Talking points for 2002
12/24/01: The shape of things to come
12/11/01: Finally, a clarity of vision
12/04/01: Apocalypse now
11/26/01: The Big Apple's core
11/06/01: What it will take to win
10/22/01: Getting the mayor's message
10/08/01: A remedy for repair
10/01/01: A question of priorities
09/26/01: Our mission, our moment
09/11/01: Running the asylum
08/29/01: Hail, brave consumer
06/14/01: Blackouts --- or blackmail?
06/01/01: A time to reap --- and sow
05/25/01: A question of confidence
05/18/01: A question of confidence
05/04/01: Making the grade
04/26/01: The caribou conundrum
04/19/01: Chinese boomerang
03/27/01: The man of the moment
03/20/01: The Fed must be bold
03/15/01: Japan on the brink
03/01/01: Rethinking the next war
02/09/01: The education paradox
01/08/01: How the bottom fell out
01/03/01: Quipping in the new year
12/20/00: A time for healing
11/13/00: The need for legitimacy
10/30/00: Arafat's bloody cynicism
10/18/00: Arafat torches peace
10/03/00: A great step backward
09/08/00: The Perfect Storm
08/29/00: Don't blow the surplus
08/15/00: Voting for grown-ups
08/01/00: Arafat's lack of nerve
07/17/00: Can there be a new peace between old enemies? Or will new enemies regress to an old state of war?
07/11/00: A time to celebrate
06/19/00: A bit of straight talk
06/08/00: Using hate against Israel
05/26/00: Is the Federal Reserve trigger-happy?
04/18/00: Tensions on the 'Net
04/13/00: A paranoid power
03/10/00: Fuel prices in the red zone
02/25/00: Web wake-up call
02/18/00: Back to the future
01/21/00: Whistling while we work
01/11/00: Loose lips, fast quips
12/23/99: The times of our lives
12/14/99: Hey, big spender
11/18/99: Fountain of Youth
11/04/99: An impossible partner
10/14/99: A nation divided
10/05/99: India at center stage
09/21/99: Along with good cops, we need a better probation system
09/08/99: Though plundered and confused, Russia can solve its problems
08/31/99: The military should spend more on forces and less on facilities
08/05/99: Squandering the surplus
07/06/99: More than ever, America's unique promise is a reality
06/24/99: The time has come to hit the brakes on affirmative action
06/15/99: America should take pride in honoring its responsibilities
06/02/99: The Middle Kingdom shows its antagonistic side
05/11/99: Technology's transforming power is giving a lift to everything
05/04/99: The big game gets bigger
04/30/99: On Kosovo, Russia talked loudly and carried a small stick
04/21/99: No time to go wobbly
04/13/99: The Evil of two lessers