Development of a new drug in 1975 cost $100 million in today’s dollars. Now, the cost of bringing a new medicine from lab to pharmacy could exceed $1.2 billion.
A new Project FDA report reveals that 90 percent of all costs incurred by pharmaceutical companies in developing a new drug occur during Phase III of Food and Drug Administration-mandated clinical trials. Phase III trials have grown longer and more expensive over time, said Manhattan Institute senior fellow Avik Roy, author of the FDA report
In 1999, an average drug trail was 460 days. In 2005, that time had expanded to 780 days.
Thousands of drugs are waiting for approval in phase II, with many companies bailing out before completing trials, their funds depleted. And that failure could lead to deaths from preventable diseases, Roy said.
“When promising treatments are kept off the market, the patients who fail to benefit go unseen,” he said. “This is especially true with common conditions such as obesity, where effective drugs would be used by millions of Americans.”
The study argues that Congress must create clear standards for conditional approvals, and give the FDA more flexibility. He recommends allowing the FDA to monitor conditionally approved drugs carefully, and pull them from the market if safety problems occur. A conditional approval process will allow drug companies to recoup research and development costs before and during large-scale clinical trials, he said.