What's wrong with the FDA? Either too fast or too slow, the agency can't find the right balance.

It is February 2004 and the scene is the Holiday Inn in Bethesda, Md.: One by one, parents, grand-parents, siblings and friends tell a committee of scientists advising the U.S. Food and Drug Administration how teenagers they loved had committed suicide, or tried to, while taking anti-depressants such as Paxil, Prozac and Zoloft that were approved as safe for adults. They demand that the FDA get tough about restricting new drugs.

How the wheel doth turn. A year later at the Hilton in nearby Gaithersburg, Md., a dozen patients tell a different FDA advisory committee about the excruciating pain, stiffness and helplessness they had suffered until they started taking the Cox-2 pain relievers Vioxx, Celebrex and Bextra. These drugs had been withdrawn or were at risk of being withdrawn because of the potential for heart attacks and stroke--and these patients were begging the FDA not to ban their drugs. "I feel like Celebrex was created for me," says Judy Fogel of Ithaca, N.Y., who has osteoarthritis.

At least since the early 1990s, the FDA has been stuck on a seesaw, alternately criticized as either a bureaucratic obstacle to industry, or the lapdog of industry--too slow in getting desperately needed drugs to the public, or too fast in rushing dangerous drugs onto pharmacy shelves. In 1992, when a drug application could take two years to be cleared, the agency was "too slow." By 2001, after more than a dozen drugs had been recalled in less than six years for serious safety problems, it was "too fast." In 2002, as approval times were lengthening, it was "too slow" again; now, with headlines about Vioxx and the others, it's again "too fast."

But the issue for CEOs who depend on the FDA for product approval is this: Is there something fundamentally wrong with the FDA regulatory process?

The FDA oversees more than one-fourth of the U.S. economy, including prescription and over-the-counter drugs, packaged food, animal drugs and food, biological products and blood banks, and a wide range of "devices," from cell phones to pacemakers to airport X-ray scanners. Only drugs and medical devices need to be approved before they can be sold, but the FDA can order the others to change their labels or even pull them off the market.

These products, often essential for life, can have dangerous side effects. That presents the FDA with a tough choice--speed vs. safety. It needs to weigh the risks and benefits of new products, get the good ones out fast, then yank back the dangerous ones just as fast. The FDA may never get the balance completely right. But with more money, new scientific technology and a stronger CEO of its own, the agency could do a better job, especially in post-market review, where it is now weakest.

No one expects the FDA to catch all side effects before approving any new drug or device. Although products typically are tested on several thousand people over about six years, some side effects become apparent only when a patient takes the drug in conjunction with another medication, or only after a drug has been in use for years, or only in cases of rare genetic defects. Perhaps most problems could be discovered if drugs were tested on a million people over 20 years, but then industry and patients would really scream about speed. "We try to set the bar for approval somewhere in the middle, between knowing everything you could possibly know versus society's need for new drugs," says Dr. John Jenkins, director of the FDA's Office of New Drugs.

Funding Influence?

To speed up the review process, pharmaceutical makers in 1992 reluctantly agreed to pay user fees to hire more reviewers under the Prescription Drug User Fee Act (PDUFA). In return, the agency had to meet strict deadlines, which are tightened each time the law is renewed.

Critics say PDUFA pushed the balance too far in the speed direction. Moreover, consumer groups fret that there's inherent pressure when industry provides so much funding--about 18 percent of the agency's total budget last year, and half the budget for new drug reviews. Pharma and FDA officials insist that the industry does not exert undue influence. "We're agnostic as to the source of our funding," says Jenkins.

Big Pharma was on the upswing of the seesaw for a while. The mass recalls of the late 1990s and early 2000s were a faint memory, while the business-friendly Republican Party had taken power in Washington. An aide to one of the politicians most critical of the FDA concedes that the agency was under pressure "to move things along. You have these stories, there's a girl dying out there, there's a diabetes drug the FDA hasn't approved."

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In one sign of Big Pharma's clout, the FDA in spring 2004 launched an unprecedented government-industry joint effort to speed drug development, which it called its "critical path" initiative. And Dr. Mark McClellan, then the FDA commissioner, declared that he wanted to shorten review times yet further, cutting the six-month deadline for high-priority drugs down to five months. That might be aggressive even for industry, says Dr. Bruce Burlington, executive vice president for quality and safety issues at Wyeth.

Now, as a result of the furor over the Cox-2s, the seesaw has shifted again. "Clearly, there's going to be an impact on reviewers when they're looking at close cases, and they see the agency coming under criticism for decisions they've made. They may tend to be more conservative," FDA's Jenkins concedes. That super-caution may have been in evidence in December, when an advisory committee recommended against a controversial testosterone patch to increase women's sexual drive, citing potential risks of breast cancer and heart disease. And the advisory committee analyzing the Cox-2s called for much more stringent tests before approving any similar drugs in the future. Speaking at the World Economic Forum in Davos, Switzerland, this winter, Sir Tom McKillop, CEO of AstraZeneca, fretted, "The danger is that this will push [FDA reviewers] away from their traditionally very well-judged sense of benefit and risk."

Once a drug gets approved, however, the FDA has little authority. It largely waits for manufacturers and doctors to report "adverse effects" to its MedWatch system. (It also occasionally partners with outside health groups such as California's Kaiser Permanente to analyze their data bases for historic trends, as one safety official, Dr. David Graham, did for Vioxx.) Its most effective tool is to require manufacturers to conduct "post-market" safety studies as a condition of approval.

Lack of Follow-up

Boston Consulting Group calculates that this practice has skyrocketed, from being required in 20 percent of new drug approvals in the early 1980s, to nearly 80 percent now. But a government investigation found that two-thirds of the companies haven't performed the post-marketing studies they promised. As a result, the FDA probably learns of only 5 to 10 percent of adverse effects. Indeed, the cardiovascular dangers of Vioxx weren't discovered through any regular reporting mechanism. They emerged mainly because Merck ran studies in hopes of proving expanded benefits for the drug. Even if adverse events pile up, it is a long, convoluted process to add new warnings to a label; it took over a year with Vioxx. The FDA is reluctant to wield its only other option, ordering the drug off the market.

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Post-market surveillance falls to two FDA offices: Drug Safety, which monitors MedWatch and the manufacturers' studies, and Office of New Drugs, where scientists consider label changes for approved drugs. Critics claim this amounts to the FDA essentially investigating its own work. "There's a kind of intellectual conflict of interest there, if you've got a lot invested in the [original] review," says Larry Sasich of the advocacy group Public Citizen. Combined with the pressure of user fees, some observers say, this makes the FDA reluctant to confront drug makers about approved products--even to the point of allegedly squelching safety warnings about Vioxx. The FDA denies any conflicts.

Consumer groups, consultants, academics, doctors and the FDA itself have been urging reform since at least 1998: mandatory reporting by doctors; FDA authority to demand new trials, change labels and fine companies; an independent safety review board; and a bigger budget.

Congressional inertia and money have been stumbling blocks. But the current outcry may finally give momentum to the safety issue. With at least four senators preparing bills to set up a watchdog office, plus similar calls from the Journal of the American Medical Association, the FDA in February announced the creation of a Drug Safety Oversight Board to track drugs after approval. Critics complain that board power is limited, but the measure may be enough to derail Congressional action.

To make sure adverse events are reported, Dr. Janet Woodcock, the FDA's deputy commissioner for operations, says a system is planned in which hospitals, pharmacies and drug companies electronically send the FDA information about the drugs a patient takes, the drug label and the patient's condition. Also, the industry has agreed to make public more information from clinical trials.

But even with such changes, post-market monitoring still faces the same unsolvable problem as drug approval: At what point do side effects outweigh benefits? And, ultimately, is the FDA condemned to seesaw?

Perhaps. But having a permanent and respected commissioner would help. Since the departure of the controversial but dynamic Dr. David Kessler in February 1997, the FDA has gone through three acting commissioners and two supposedly permanent chiefs in eight years. That has chilled morale, made reviewers cautious, and hurt the agency's image. "I am certain that the agency's large public failures on the flu vaccine and the Cox-2 drugs are directly related to the absence of accountable leadership," asserts Jerold Mande of the Yale University Cancer Center, who was one of Kessler's top assistants. President Bush finally nominated acting commissioner Dr. Lester Crawford for the permanent job, but he is tarnished by the recent controversies under his watch. Moreover, Crawford is a veterinarian, not a medical doctor--a perceived weakness that helped kill his first bid for the job three years ago.

Science may help steady the seesaw, too. Using genomics, drug makers could target molecular actions in people with specific genetic profiles. That should allow them to test a drug in smaller trials of screened subjects. Small trials mean less data to review (speedier approvals), while molecular targeting means fewer side effects (better safety).

The whole point of balancing a seesaw is that there are two sides. "I hope," says Wyeth's Burlington, "that we don't look at a point where we are looking only at safety, and don't forget that these drugs do a lot of good."

RELATED ARTICLE: A Pharma CEO's Survival Guide

Pharmaceutical chief executives like to see themselves as quasi-doctors who provide medicines that save people's lives. Yet the public now largely sees them as hucksters who pressure government regulators to let them sell dangerous products that kill people. How can CEOs survive in this atmosphere?

* With the public demanding more information about clinical trials, Eli Lilly, Merck, GlaxoSmithKline and Roche have decided to stop fighting a losing battle and have endorsed public posting of trial results.

* CEOs such as Pfizer's Henry McKinnell and Lilly's Sidney Taurel have been hitting the speaking circuit, trying to make the industry's case.

* Peter Tollman, a vice president of The Boston Consulting Group, suggests that CEOs who don't like the spotlight could work behind the scenes with the FDA to draw up standards, which the FDA can then publicize.

* If the FDA seems to be getting overly picky, demanding more and more tests before approving a new drug, CEOs should remember that old medical advice: An ounce of prevention is worth a pound of cure.

Fran Hawthorne is the author of Inside the FDA: The Business and Politics Behind the Drugs We Take and the Food We Eat, John Wiley & Sons, March 2005.