Personalized Medicine Requires Major Regulatory Reform
Posted on Wed, Jul 27, 2011 @ 02:53 PM
I read a very interesting and thought-provoking article in the July 25th issue of The Wall Street Journal about the importance of regulatory reform to the success of personalized medicine.
The authors of the article, one an economist and the other a professor of medicine from Washington University, argue for major changes in how the FDA reviews and approves drugs. As I read this article, my initial thought was how very radical and extreme their ideas sounded; yet the more I thought about it, the more sense their recommendations started to make.
The current regulatory system requires drug companies to provide ample evidence of both safety and efficacy for FDA approval. Under the current system, estimated costs to bring a new treatment to market are between $1 and $1.5 billion. The largest portion of those costs goes towards clinical trials establishing efficacy. These costs have increased significantly over the past 20 years. Meanwhile, drug company spending on R&D has reached an historic high of $67 billion while providing consistently decreasing ROI in terms of new drugs being approved. At least part of the reason for this, I believe, is that our current regulatory system is arthritic and antiquated.
The current regulatory system in the United States has created an economic model that only supports new drugs capable of generating more than $1 billion in sales, and provides little incentive for innovators developing niche products targeting specific patient types and disease targets. In other words, exactly the kind of treatments and technologies required to truly be able to deliver on the promises of personalized medicine--which can be summarized as providing the right treatment, for the right patient, at the right time.
Michele Boldrin and Joshua Swamidass, who authored The Wall Street Journal article, propose the adoption of a "progressive" regulatory approach, initially for drugs to treat rare diseases and then, if successful, implemented across the board. They propose a system whereby the FDA can approve a drug once a company has established that it is safe for humans. The company will then be allowed to sell the drug at a predetermined price until further research is completed that establishes its efficacy--at which point the company will then be able to sell the drug at market prices.
People suffering from rare diseases for which there are limited treatments want access to as many new treatment options as possible. The regulatory reforms proposed by Boldrin and Swamidass could help make this possible by lowering drug development costs while providing strong incentives for life sciences companies to conduct further research to provide evidence of efficacy in order to maximize their ROI.
Personalized medicine is in many ways the antithesis of the blockbuster model of drug development, which most industry observers have long agreed is now well and truly dead. The blockbuster model of drug development was a logical response by industry to a regulatory environment that has driven drug development costs into the billions. If it costs you $1.5 billion to develop a new drug, you'd better be sure that drug has the sales and lifecycle potential to justify your investment.
For the promise of personalized medicine to be achieved, companies developing targeted therapies that will benefit a select group of patients suffering from a specific disease need to be able to afford to innovate and bring these new treatments to market. And to do that, the regulatory requirements for companies to get drugs FDA approved will need serious reform.