David R. Henderson  

Henry Waxman Wants Less Regulation?

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To save money for consumers, Waxman is willing to allow certain drugs, called biologic drugs, to enter the market without clinical testing that proves their efficacy. He realizes that requiring clinical testing for efficacy will slow things down and needlessly keep important drugs out of the hands of suffering patients.

But by that same principle, he should favor repealing that requirement for all new drugs. Just as his proposal would get drugs into patients' hands more quickly and create more competition, so too would a wholesale repeal of the efficacy requirement save lives and create more competition. The case for repealing the efficacy requirement for regular drugs, moreover, is just as strong as the case for repealing such requirements for biologic knockoffs.

This is from David R. Henderson [me] and Charles L. Hooper, "Markets Can Determine Drug Efficacy," published today on Forbes.com.

Henry Waxman seems to understand the arguments when they lead to a conclusion he favors.

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CATEGORIES: Regulation

COMMENTS (10 to date)
Mike writes:

The question I have always had is why the proof of efficacy was added to the FDA regs in the first place. Does Congress not trust the pharma industry like they are a bunch of 19th century snake oil salesman or do they think doctors need the extra guidance to do their job.

The health sciences are sufficiently driven by medical conjecture and hunches that elimination of efficacy would encourage experimentation. My concern is a health care solution will include an American form of the British NICE that will evolve into telling doctors what they can and can not prescribe rather than providing them "best practices" recommendations. This is what I would expect to occur with single payer health care, an argument I have heretofore not heard against the public option. But then again, I don't think the arguments that you hear are what is the intent of the protagonists. I guess that is what you call a hidden agenda.

Dr. T writes:

Some health care professionals and pharmaceutical executives believe that voluntary drug efficacy studies are preferable to mandatory ones. Efficacy study costs would be lower, and the studies would be more likely to provide usable information. Doctors are unlikely to prescribe unstudied drugs (except for close cousins to well-studied drugs), so drug companies would be willing to fund the efficacy studies. The risk of fraud would be no greater than it is today. And suspicious competitors could fund replicate studies to see whether the first was unbiased.

Since I find the FDA to be more hindrance than help, I'm in favor of ending FDA-mandated clinical studies.

Bob Murphy writes:

In case some people wonder why David stresses his middle initial, it's because there are two pro-market David Henderson economists walking around.

Justin P writes:

So my question is who are the bootleggers here?

It's obvious, at least to me, that the Baptists are they ones wanting lower cost drugs, which no FDA testing will surely do. Yet, we all know, no politician will do anything altruistic without a money man greasing his wheels.

So who is greasing Waxman's wheels?

I'm lazy right now, but does anyone know where you can get the info to see which Pharm companies have a new "biologic drug" coming out and just gave Waxman a campaign contribution?

Monte writes:

In case some people wonder why David stresses his middle initial, it's because there are two pro-market David Henderson economists walking around.

Can we allegorically assume the "H" stands for Hume?

DBT writes:

Here is Waxman's open secrets page for 2010 campaign contributions (hope this link works):

Hospitals, pharmaceuticals and unions are showing him some serious love.

Justin P writes:

Thanks DBT

Yancey Ward writes:

There is zero rationale for favoring abandonment of efficacy trials in the case of biologics and not favoring it for small molecule drugs. Waxman is being bought off, even though I think efficacy testing (prior to approval) is mostly worthless on a cost/benefit basis.

One thing efficacy trials do do is that they are the trials in which drugs are first tested in patients that are most like the intended market. Safety trials are overweighted to very healthy individuals, today.

Marc writes:

I wonder if Waxman is for efficacy testing of treatments, as way to bring down health care costs?

David C writes:

"I wonder if Waxman is for efficacy testing of treatments, as way to bring down health care costs?"

The comparable term for efficacy testing of treatments is comparative effectiveness research. I'm not sure what's Waxman's position on it, but see Tyler Cowen's article from the NYT.


It seems to me, that what Waxman is doing is allowing the approval of drugs without efficacy testing that are similar in nature to ones that have already been approved. At least, that's what I got from your article. This is wholly different from eliminating efficacy testing altogether. In Waxman's proposal, he believes efficacy testing works, but the difference between these biologic drugs is not significant enough to warrant individual tests for each one. There is a lot of room to disagree with his position, but accusing him of hypocrisy, which he hasn't done anything of the sort, seems to be unfair.

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