Finkelstein 22 Sep 05 Drug Regulation and the FDA

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1 1 Drug Regulation and the FDA Historical perspective on the FDA (ancient history to 2000; PhD for other part) - set-up - what does it do - what ought to happen - succession of crises (5): bad things have to happen before action Protection from fraud - 19 th century concern re: fraud (adulteration) multiple acts passed - U.S. Pharmacopeia sets purity standards o antedates FDA Food and drug safety issues - The Jungle (Upton Sinclair) o advocating need for food regulation o at the time, lots of drugs didn t work o oral ingestion - 1 st crisis: 1901 tetanus spores, 13 children die 1906: pure Food & Drug act - bureau of chemistry: enforcement ability - court test: can t promote adulterated products o false claims allowed? Obsolescence - science/technology revolutionize everything Changes suggested to authority of FDA : crisis 2 o sulfanilamide treat bacterial infections carrier agent: ethylene glycol 1938: Food, Drug, Cosmetic Act - powers of FDA, specifically enforcement - prove safety of product before marketing o no dossier; send letter to FDA w/ intent no response re: prevention, free to go revolutionary at the time - authority to inspect factories

2 2 Refinements : can t get approval for one thing and market for another : need prescription s: disdain for drug industry (market power; monopolistic) o drugs weren t any good in 1950s o industry: target for politicians 1960s: thalidomide disaster (3 rd crisis) - before 6 months were up: FDA needed more time - successive delays side effects known o Phocomelia: birth defect: no arms or legs - Dr. Kelsey: died late 1990s; folk hero - reason for delays: slow vs. concerned - no specific requirements for submission to FDA - thalidomide is back Pre-market review and approval of new drugs - safety, worked or not - efficacy vs effectiveness o clinical trials o idealized settings protocol o real world: tougher standard - clinical trials vs. panel of experts re: approval - implication of law required review of drugs on market before 1962 o only a handful of a thousand drugs were effective - FDA: authority to inspect manufacturing practice - burden for industry? o time, cost, etc. o compared to Europe, U.S. would show drug lag o cost burden: only big companies can survive prediction occurred but didn t last o Boston: center for complaint; frustrated doctors 1969: surgeon general - pestilence is over (10 years lost in antibiotics) Company can be recognized for something that occurred years ago - industry: only things that s necessary New meds timeline - strategize applying for patents - today: companies patent drugs as much as they can

3 3 - other than cancer drugs: investigate side effects by starting in a healthy body - political posturing: anti-guinea pigs 1970s 1980s 1990s - medical device regulation didn t exist yet - IUD (intrauterine device): next crisis - medical devices: made by mom & pop companies o 2 paths for approval: pre-market, clinical trial (less demanding than drugs) o sec 510K process: substitute equivalent to something on the market 1970 compared to compared to 1960 etc. 2005: no longer related this is a good thing - Kimberly Clarke: feminine napkins medical devices o diagnostic devices, stents, implants several different industries, one trade association - orphan drugs (lung/colon cancer fall under orphan threshold) o markets too small o drug not inclined to be developed o government imposed market exclusivity o law rewritten, some companies could knock out o Genzyme: strategy to make a lot of money gauche disease: 0.25 million / patient / year - patent / generic substitution o encourage testing on children (no blind prescribing) o different delivery system o easier for generics to get on market chemical / biological equivalent to proven molecule - FDA collects fees from industry to hire more reviewers FDA s other roles - package insert, label, advertising - industry spending money - direct: controversial with doctors

4 4 FDA mission - serious, well-meaning - add value to regulatory process Fifth crisis: COX-2 inhibitor

5 Finkelstein 27 Oct 05 5 health care payment "system" - do we have a system? - charitable name? health care in crisis? - many aspects of how healthcare is delivered: inefficiencies, errors, etc. - crisis refers to costs assoc w/ healthcare - current year: 14.5% gdp : spending 1/10 what we're spending now : spending 1/5 of what we're spending now - growth is what's notable growth in health care cost components - hospital care proportion has come down - physician care has gone up - pharmaceuticals GROWTH; why is this proportion rising so greatly? - prices increasing - volume: only in past 20 years or so have drugs been any good health insurance coverage - half of population gets insurance through their employer % of population (40-45 million people) without insurance medicare - program for the elderly: retirement age are eligible - part a: hospital insurance: financed through trust fund - part b: supp medical insurance: not automatic, covers physicians' services, rates insufficient - "taking assignment" - part d: enroll in a prescription drug plan; hmo that offers drug coverage to medicare beneficiaries; carries a premium medicaid - authorized by fed leg, partly funded by fed, administered by states - intended to cover all households that fall below fed poverty line - state can establish own criteria - nature/generosity varies greatly across states - for most states, 2nd largest expenditure - 47 million people, covers 1 in 4 children in u.s., 1 in 2 below poverty level private insurance - "managed care" - responsible for financing care that individual patients get

6 Finkelstein 27 Oct 05 6 managed care options - hmo: pcp serves as a gatekeeper; pay a lot - indemnity plan: high premium, unlimited choice uninsured - not wealthy, but not sufficiently indigent - young, healthy - jobs that don't offer insurance - 80% come from working families - 80% u.s. citizens - 60% in low income - young adults tend to be uninsured more often payment for hospital/physician services evolved separately - hospital: 1980's: prospective payment: formulas ahead of time for cost structures - physician: u.s. vs the rest of the world - south korea is only comparable country ===== prescription drugs - fastest growing component of healthcare - brand name drugs growing at multiple of general inflation rate major price increases in top selling drugs btw 2000 and 2003 after generic on the market, prices decrease drug prices cheaper in canada than the u.s. slowdown -- many drugs will go generic costs of drug development