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Pharma Industry Uneasy About FDA Overhaul

Insurance coverage hinges on solid efficacy data

President Trump’s promise to slash government regulations by at least 75% has some pharma executives worried that less-robust FDA oversight would make it harder to secure insurance coverage for pricey new drugs, according to a Reuters report.

The Biotechnology Innovation Organization, an industry trade group, told Reuters that during discussions with Trump advisors, lobbyists urged the administration not to name a new commissioner of the FDA who would act “rashly” to speed up the agency’s approval of new medications.

That sentiment was echoed by executives at more than a dozen pharmaceutical and biotechnology firms, who told Reuters that the FDA is already adopting new drug-development models and warned that a looser review process would put patients at risk.

While most sectors welcome less FDA oversight, drug makers say a robust review process is critical in convincing physicians and insurers that an expensive new drug has value, Reuters points out. Otherwise, the time and money it takes to bring a new drug to market––which has run as high as $2.6 billion––would be lost if insurers aren’t willing to pay for the product.

John Maraganore, chief executive officer at Alnylam Pharmaceuticals, said the FDA should speed the approval of lower-cost generic versions of drugs that have lost patent protection, but he warned that allowing new products to be launched without extensive testing could be dangerous.

Health insurers are pushing back against high-priced drugs. Sales of expensive new cholesterol medications from Amgen and Regeneron have stalled as insurers limit coverage, waiting for clinical trial results that prove the drugs significantly reduce the risk of heart attack and other cardiovascular crises, Reuters notes.

After top executives at Merck, Johnson & Johnson, and others met with President Trump at the White House last month, industry trade group Pharmaceutical Research and Manufacturers of America said the meeting found common ground, such as tax reform and the removal of outdated regulations. The group, however, declined to comment on the shakeup at the FDA.

The fate of FDA deregulation will be driven by its next commissioner, according to Reuters. Candidates include former FDA staffer Scott Gottlieb, and Jim O'Neill, a colleague of a Trump supporter, who has advocated for allowing some drugs to reach the market once they are shown to be safe, even if there is little or no evidence that they actually work.

Source: Reuters; February 15, 2017.

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