Improvements in medical devices, drugs and procedures are enormously important to society. Sixty years ago, my father died of a heart attack, leaving behind my mother, then pregnant with me, and my 18-month-old sister. Today a stent or an emergency bypass would have had him home in a few days.
Five years earlier, my maternal grandmother had died of complications from diabetes that now would be remedied easily. Last year, I had successful surgery to correct a detached retina that years ago would have left me blind in that eye. Nearly everyone can cite similar examples from their own lives.
At the same time, people are outraged when someone is harmed by an unsafe drug, heart valve or pacemaker. We want new technology, and we want it to be foolproof.
That presents a challenge to society. How can we motivate the development of new medical technology while protecting public health and life from an unsafe invention?
Our leaders addressed the first challenge nearly 225 years ago in the U.S. Constitution by including Article 1, Section 8 (“The Congress shall have power … To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries”).
That is one of the most economically important clauses in the Constitution and remains the core of drug and medical device policy. But the law did not address the second part of the question — how to protect public health from unsafe or ineffective inventions — for another century until we passed the Pure Food and Drug Act in 1906.
That act led to procedures in effect today that require drug or device manufacturers to prove the safety and efficacy of new inventions to the Food and Drug Administration before the products can be sold to the public.
But there is an inherent tension between the possible harm to society from two different sources. Approve new medical inventions too carelessly and people will die needlessly because unsafe products will be sold in the marketplace. Make the approval process too cumbersome and people will die because life-saving inventions are unavailable for public use.
Some economists, notably Milton Friedman, argue that the costs to society from the second danger — too slow and difficult an approval process — are far greater than those from the first. His solution, which is to abolish the FDA and let firms sell whatever drugs or devices they want, makes sense in a libertarian fantasyland where everyone has perfect information about products’ benefits and costs. Most practitioners of reality-based economics don’t agree with it.
But Friedman’s basic insight — that society can be harmed by a regulatory approval process that is too difficult just as surely as by one that is too lax — is important but often ignored. And agreeing that government can make society better off with prudent regulation does not mean that existing regulatory policies are necessarily optimal.
The drug and medical device manufacturing sector knows this well. So FDA medical device division director Jeffrey Shuren got an earful from members of that community when he came to town this week. They complained of slow, unpredictable, expensive and arbitrary FDA procedures.
Yes, some of these people have a financial dog in the fight. The medical device industry that includes Medtronic, St. Jude Medical and Boston Scientific and a host of smaller companies employs some 30,000 people in Minnesota. Business would make more money more quickly if device approval were easier and faster. But people also expressed the genuine anguish of those who know that patients die every day while inventions that could save their lives languish in FDA purgatory.
Some solutions are managerial: streamlining procedures and using existing resources more efficiently. These may include fast-tracking the approval of new devices that vary slightly from existing ones that have proven safety and efficacy track records.
Giving the FDA more money to hire more and better-trained staff is another option, but one that is difficult to attain in a time of unsustainable budget deficits.
Making inventors or manufacturers pay more of the regulatory costs is something we instituted in the past, but raises concerns that it gives them more say in the process. And that practice discriminates against small startup companies spearheaded by inspired inventors who have come up with some of the most important breakthroughs in recent decades.
Public attitudes complicate this economic and technical problem. The public is highly sensitive to deaths or injuries from a product given a clean bill of health. They are much less responsive to deaths due to the delayed introduction of lifesaving innovations.
Academics predictably argue that we need more funding for academic research to better quantify deaths and illness that might be avoided if the approval process moved with greater alacrity. Some academics also call for more studies on how the high costs of current approval processes add to the costs of the drugs or devices themselves and hence to the ever-rising cost of health care.
These are good ideas. More information generally leads to better decisions. But it will never eliminate the fundamental conflict between the dangers of too-hasty and too-sluggish approval of vital inventions.
© 2010 Edward Lotterman
Chanarambie Consulting, Inc.