The Damage Done by the FDA, Symptom of the Deeper Problems

It's not hard to point out the damage done by the US Food and Drug Administration (FDA) - as for any regulation, you just have to follow the incentives and the results. The shackles cast on progress by the FDA are an entirely expected end result in any system where power is disconnected from accountability for results; it achieves exactly the opposite result to that intended by those foolish idealists who set it in motion.

For various political reasons, also unconnected to the production of meaningful results in medical research and development, it is the season for savaging the FDA at the moment. Which means, for a change, various political talking heads - selectively - speaking a little truth about the effect of regulation, centralized power and large, unaccountable government. We'll see how long that lasts:

Free the Elderly

Consider a 90-year-old man suffering from severe kidney disease. He would like to take an experimental drug, but his doctor can't get him in on the clinical trials. As a result, the man must wait nine more years until the drug is approved by the FDA. Unfortunately, this man's advanced age means he has only a slight chance of living another nine years.

Heart Stents and FDA Blockage

FDA is a scientific bureaucracy with police powers. Patients and physicians are free to choose only those drugs and medical devices that it has approved. When FDA approves a therapy that later turns out to be unexpectedly risky, the agency is the subject of front-page headlines and congressional hearings. On the other hand, when FDA delays a badly needed new therapy, patients will suffer but hardly anyone will blame FDA. We'll just think that medical science can't help these patients.

Consider, for example, FDA's 10-year delay, in 1967-76, in approving beta-blockers to prevent death following heart attacks, because of the agency's fear that the drugs might be carcinogenic. During those years, the drugs saved lives in Europe and elsewhere, while an estimated 10,000 heart attack victims unnecessarily died in this country each year. When beta blockers were finally approved in the US, to wide acclaim, hardly anyone raised the lethal effects of FDA's slowness.

A Better Way to Increase Access to Prescription Drugs

If the agency approves a drug or device that later is found to be unsafe in any way, the public and politicians blame FDA for the error. But, if the agency delays when reviewing applications, the patients who need experimental new treatments are worse off, and some may even die waiting for FDA to act. In both cases, real people are hurt. But FDA is only criticized for approving risky medicines - never for keeping beneficial ones off the market. As the Vioxx episode shows so clearly, FDA faces huge incentives to slow the pace of its reviews.

As it turns out, however, that extra agency caution doesn't actually improve drug safety. Studies conducted by FDA itself show that the rate of drug withdrawals has remained essentially unchanged over the last 25 years, despite rising and falling approval times during that period. On the other hand, the health benefits of faster approval decisions far outweigh the risks associated with the small number of unsafe drugs that occasionally do make it to market.

The Harmful Side Effect We Never Hear About

The FDA's "cover" for these ill-advised innovations is that they are a response to a report on "drug safety" published last Fall by the quasi-governmental Institute of Medicine. However, the IOM's deeply flawed, one-sided analysis will remedy few, if any, of the FDA's shortcomings. In fact, many of their recommendations would make the agency even more risk-averse, reduce the number of drugs emerging from the R&D pipeline, and compromise public health.

Neither the Congress nor FDA (nor the IOM) is willing to admit that the agency's most significant problems are mismanagement and excessive risk-aversion. It's much easier to conclude that there is insufficient regulation and to throw more resources at the problem. (And recall economist Milton's Friedman's wry observation that only government responds to a failed program or project by expanding it.) Meanwhile, regulators keep raising the bar for approval, especially for innovative, high-tech products. The FDA is requiring ever larger numbers of patients in clinical trials, its demands for post-marketing clinical trials have proliferated wildly, and "risk management" plans for newly approved drugs have been inconsistently applied, punitive and often more appropriate for weapons-grade plutonium than prescription drugs.

Congressional Cures?

These proposed legislative remedies for the FDA's problems, with more planned for later in the year in both the House and Senate, are analogous to the discredited medical practice of bleeding the patient with leeches. By intensifying the FDA's notorious risk aversion, the new measures will inflate even further the costs, difficulty and uncertainty of drug development and reduce the number of drug candidates that begin and complete clinical testing. They will drain the life's blood from innovation and inflict harm on patients. If these pieces of legislation are enacted, they will validate yet again Will Rogers's observation about Congress: "Every time they make a joke, it's a law. And every time they make a law, it's a joke." And as usual, the joke will be on us.

The Bipartisan War on Medical Liberty

There are a million reasons we should have medical freedom, and they must be articulated if we are to avoid a disaster in the next several years. Libertarians must go beyond what we often hear from free-market wonks: the usual denial that there’s anything wrong at all with the system, as if it’s already a free market, and the usual defenses of the largest pharmaceutical companies as the most persecuted minority, what with its inflated, FDA-protected, federal-patent-ensured mega-profits under attack. We must mount a principled, radical and informed intellectual assault on the fascist and socialist threats to medical liberty if we are to restore it or even defend what’s left of it.

The economics should speak for itself, but the right to control one’s own life and body is the core, moral argument for medical freedom. Life and death are intimately involved with the healthcare issue as with few others. Unfortunately, for the time being, it appears that creeping healthcare totalitarianism is on the agenda of both parties. They only disagree on how fast to run us off the cliff, and who should navigate us there.

Though I suppose I should mention that the originating site for that last article rolls out the attacks on big government and an unaccountable FDA on a regular basis, regardless of the season - they could do with upping the quality, however. As that author points out, the FDA is just one component of a dynamic establishment built upon, interacting with and changing the direction and application of government power - a bunch of pigs squirming around at the trough, and fighting just as rough as they can without upsetting the slop.

Access to centralized power (and money, and control) is something of a cancer, spreading throughout a society, destroying potential and progress - the lure of short-term gain at someone else's expense is irresistible to many. The culture of large business and venture capital embraces the use of government to suppress competition - through control by force, such as through patent law and intellectual property, or by raising the cost of doing business through regulation to lock out innovative and disruptive young companies. In the process, progress - which absolutely requires competition - is stifled, and these corporate cultures become corrupt, moribund and dependant on government. This process described well in a article at

The Chicago School of economics favored and still favors the theory of "regulatory capture." Under this theory, an industry or some portions of an industry cultivate government to obtain laws and rules that favor the industry.

The government trades favors for what it wants. Politicians gain political contributions, side payments, and votes for being seen to control the industry. The industry captures the regulators. End of story.

North went much further. He called the first step of obtaining favors "baiting the trap." But matters do not stop there, he pointed out. The trap is set when the industry becomes comfortable with its subsidy, tax break, tariff, exclusive position, license, or whatever. It then begins to extract monopoly rents and to lower product quality.

This then leads to further steps such as public outcry and a government demand for the industry to police itself. Then come crisis, further regulatory intervention, and eventually a government stranglehold over the entire industry via a panoply of boards and price controls. This is when the trap is sprung. The market is replaced by government power and bureaucrats. Government, its aim being control, traps and captures the industry.

In the shorter term, the interest groups use the state against the public. In the longer term, the state and its bureaucrats rule the roost. In the end, the government bureaucracies expand. Paperwork and soft jobs rule the industry, innovation and competition are eclipsed, and the public suffers from poor product quality and high prices.

The motivation for most of these recent attacks on the FDA? That would be coming from the other squirming pigs wrestling in the pen, such as the large pharmaceutical and medical development companies, trying to make the most money they can from the suppression of competition and progress. They might be working on progress, but they're working just as hard at pushing new and better ideas below the waterline - so long as there's the threat that someone else will make money or threaten the bottom line for an aspect of their business model.

The greatest risk to any progress is the elimination of open competition within a framework of the rule of law. We have neither open competition nor a rule of law for medical research and development in the "representative" democracies of this modern world - which means each year that passes adds more to the opportunity cost of where we could have been. We live in a world in which the enormous photographic industry went from film to stored bits in something like a decade, with tremendous long-term benefit to all - and in which hospitals are crammed with paper records and give terrible service because they and the innovators who would help them are not permitted to do better. That is the cost of the regulatory burden, and it is being exacted in the future years of your life, the years you might have lived in good health - but will not because research and development is not progressing as fast as it could in a free society. Politicians and government employees are not enablers of progress - they are millstones; the glue in the works; the boot on the neck:

This state of affairs, in which politicians and special interest groups willfully hold back and destroy the engines of progress, is not peculiar to healthy life extension. All medical research in the US and Europe is subject to ignorant, pandering regulation: price controls, shortages, enormous tax burdens, and so forth. In the worst cases, such as Germany and France, you see entire countries that contribute next to nothing to the advance of medical science. This is not for lack of will or desire, but their research and medical industries are hamstrung by decades of destructive government intervention.

In the US, the grand debate over medical regulation is currently best represented by price controls, drug reimportation, "free riding" and the effects of the FDA on the cost of new medical science. This debate is not academic for those of us who focus on healthy life extension - all the medical research that interests us must go through this same broken system. If the system creates too much of a burden on research or commercialization, then new medicine will never see the light of day, no matter how useful or compelling it is.

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this is what you can expect in a monopoly capitalism: bureaucracy and stifling of competition.

As for ageing research and application to cure patients researchers shouldn't do it in only one country but in many countries and set up clinical trials in a country most favorable to life extension and rejuvenation.

Posted by: nick at February 14th, 2007 4:49 PM
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