Early in the COVID-19 pandemic, the US Food and Drug Administration faced the task of convincing a skeptical public of the safety of new vaccines when the agency began authorizing them for emergency use less than a year after the pandemic began. Ultimately, the vaccines were widely found to be safe and effective in preventing severe disease, and their accelerated review will go down in history as having saved millions of lives.
But COVID vaccines weren’t the first medical products to be brought to market through an expedited process. So how do other new therapies that the FDA expedites fare?
“The findings of our study suggest that regulatory innovation can support more efficient drug development—in particular, in settings where we have unmet medical needs. ”
In the first comprehensive analysis of its kind, Harvard Business School researchers found that a certain set of drugs that made it through clinical development faster were just as safe as drugs that went through a longer, more costly development process. The study’s findings could have wide-ranging implications for not only drugmakers trying to advance innovation, but patients waiting for potentially life-changing treatments.
“The findings of our study suggest that regulatory innovation can support more efficient drug development—in particular, in settings where we have unmet medical needs. This, in turn, could save and extend lives and motivate drug manufacturers to focus attention on developing therapies intended to treat serious medical conditions,” says Ariel D. Stern, the Poronui Associate Professor of Business Administration at HBS.
Stern cowrote the December 2022 working paper with Amitabh Chandra, the Henry and Allison McCance Family Professor of Business Administration at HBS and the Ethel Zimmerman Wiener Professor of Public Policy and Director of Health Policy Research at the Harvard Kennedy School of Government. Jennifer Kao of the University of California, Los Angeles and the FDA’s Kathleen Miller are also coauthors.
Speeding innovation without compromising safety
The US pharmaceutical industry spent $83 billion on research and development (R&D) in 2019, according to a 2021 report from the nonpartisan Congressional Budget Office (CBO). The median cost to develop one drug was $900 million, with half of that amount going toward funding the necessary rounds of clinical trials that precede an FDA application.
While the FDA’s standard new drug application review takes 10 months, the entire development process often takes more than a decade, says the CBO report. During that time, a drugmaker isn’t profiting from its investment, and patients outside of clinical trials—particularly those suffering from life-threatening conditions—aren’t benefiting from promising treatments.
“If there are ways to accelerate the development of new medicines without compromising their safety, this would be a major win for patients as well as manufacturers.”
“A thorough process during which evidence is collected to support the safety and efficacy of new drugs is vital to supporting the FDA’s mandate to protect public health,” Stern says. “But at the same time, if there are ways to accelerate the development of new medicines without compromising their safety, this would be a major win for patients as well as manufacturers.”
To study the safety of a wide variety of medications, the researchers collected FDA data between 2006 and 2018, focusing on 396 new drugs. Among this pool were therapies that had received the FDA’s Breakthrough Therapy Designation (BTD), a status that confers dedicated regulatory resources on products that can either address a new medical problem or assist with an existing problem better than any available drug on the market. While COVID vaccines weren’t BTD drugs—the FDA prioritized them even further as part of Operation Warp Speed—they were expedited for similar reasons.
To evaluate the BTD program, the research team looked at the time spent in late-stage clinical testing, as well as data collected from the FDA’s Adverse Event Reporting System, which relies on reports of negative side effects ranging from headaches and nausea to hospitalization and death submitted by drug developers, doctors, lawyers, and consumers.
The analysis revealed no difference in the frequency of adverse events reported for BTD drugs versus similar drugs that lacked BTD status and took longer to gain approval. The research team concluded that the accelerated nature of the BTD program, which includes access to dedicated regulatory expertise, didn’t impact the safety or efficacy of new drugs. In fact, the policy that gave rise to BTD—the US FDA Safety and Innovation Act of 2012—ultimately sped innovation and increased efficiency, Stern says.
“We can think about public policy and regulatory policy innovation allowing us to do more with what we have,” she says.
A quicker process could save millions—per drug
The FDA didn’t receive additional funding for the BTD program; instead, the agency shifted the focus of some of its high-level regulators to expediting drugs. The streamlined process allows BTD drug developers to get extra attention from these regulators, Stern says. “This allows drug developers to focus on executing efficient clinical trials,” she says.
This attention leads to more constructive conversations before a drug starts late-stage clinical studies. Stern and her colleagues’ research found that BTD drugs spent 23 percent less time in the final stage of clinical trials as compared to a matched set of drugs that came to market just before the BTD program was launched.
“It hints at potential efficiency gains in doing so, but our analysis stops short of drawing conclusions for all new pharmaceutical products.”
According to the data analysis, the BTD program is likely to have saved millions of dollars in research time without compromising drug safety or efficacy for qualifying medicines. The researchers write that by cutting months of time in late-phase trials, the BTD program could be worth upwards of $5 million to a developer at that stage of research alone. Previous research estimated that each additional month for phase three trials often cost more than $650,000.
However, a quicker, less costly approach may not be appropriate for all pharmaceutical products, cautions Stern.
“This study focuses specifically on a program that targets a subset of important medicines. It hints at potential efficiency gains in doing so, but our analysis stops short of drawing conclusions for all new pharmaceutical products,” Stern says.
Although COVID vaccines are now widely considered safe and effective, the public’s fears were a reflection of a broader hesitation about faster-than-expected R&D processes, Stern says.
“Regulation in health care product markets exists for a very good reason,” she says. “We don't want drugs or medical devices that are dangerous being released to the public.”
You Might Also Like:
- Can Amazon Remake Health Care?
- Post-COVID Health Care: More Screens, Less Red Tape?
- A Rare Find in Health Care: A Simple Solution to Racial Inequity
Feedback or ideas to share? Email the Working Knowledge team at hbswk@hbs.edu.
Image: iStockphoto/BrianAJackson