Drug Delays Hurt Research

The extraordinarily expensive and time-consuming process of getting a new medicine approved by the Food and Drug Administration is becoming even more perilous. Take the case of Avastin. The FDA approved Avastin to fight late-stage breast cancer in 2008, but the agency has spent much of 2010 debating whether to reverse its decision.

Medical researchers and patients are on hold until Dec. 17, when the latest decision is expected.

Top executives at Genentech, the makers of Avastin, are not the only ones watching these internal bureaucratic battles; virtually every other drug research company is watching closely as well.

One predictable result of this indecision will likely be to deter investment in research and development of new drugs. How many pharmaceutical CEOs can take the risk of investing hundreds of millions of dollars into research on drugs to battle breast cancer and even rarer diseases if the FDA can withdraw its approval?

This indecisiveness quashes the incentives that are needed to encourage investment in medical innovation — an already risky proposition.

But bureaucratic delay is only part of the problem facing drug development. The new health reform law includes a new tax on pharmaceutical companies totaling $16.7 billion through 2019, plus $2.8 billion every year thereafter. This will further sap research funds.

Add to this a new tax of 2.3 percent on medical devices such as knee replacements, heart stents and insulin pumps, and it is clear that government actions are working to deter investment and innovation on many levels.

But it doesn’t end there. The new health law creates a Patient-Centered Outcomes Research Institute. This new agency will have powers similar to Britain’s National Institute for Health and Clinical Excellence.

While this sounds NICE — the agency’s actual acronym — British “clinical excellence” actually involves government officials determining whether to allow access to new drugs and treatments for its citizens. Too often, these life-and-death choices weigh costs against the needs and even lives of patients.

Patients are the ones who wind up paying the biggest price. NICE has denied late-stage drugs to at least 16,000 cancer patients. One high-tech drug to treat kidney cancer was approved only after a major public outcry over its denial. In mid-November, NICE reaffirmed its decision to disapprove Avastin for NHS patients, stating that “the benefits offered (don’t) justify the cost the NHS is being asked to pay.”

The result of this bureaucratic intrusion is clear: Cancer survival rates are much lower in Britain than in the United States. Lancet Oncology, the prestigious medical journal, reports that 84 percent of U.S. women live at least five years after breast cancer diagnosis. Only 70 percent of British women survive that long. Among American men, 92 percent of men with prostate cancer survive for at least five years, compared with only 51 percent of their British counterparts.

Rather than learn from these lessons, the United States is marching forward to imitate the central planning so prevalent in countries with government-dominated health systems.

President Barack Obama’s new health law contains at least 159 new government boards and agencies charged with regulating and micromanaging virtually every aspect of the U.S. health sector. One consequence of this regulatory intrusion, higher taxes and bureaucratic delay will be to deter companies from investing the $1.3 billion it costs to get a new drug to market.

America has been the world’s medical laboratory for decades. Most of the world’s medicines and devices come from U.S. researchers. The world’s top 10 pharmaceutical companies invested $54.7 billion in research in 2006. Among these, five U.S. firms financed 49.6 percent of that amount.

If government policies hobble medical research, no other country will be able to fill the vacuum. Further bureaucratic intrusion and higher taxes on this industry will harm global health, decrease life spans and reverse the medical progress that helped to dramatically expand life expectancy and the quality of life over the past century.

Published in the Omaha World-Herald, Nov. 22, 2010.

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