Follow the FDA’s Self-Interest

Bringing a new drug to market now takes, on average, $2.6 billion and more than 10 years. Those numbers could shrink, and countless patients could benefit, if Food and Drug Administration regulators were less risk-averse. I know that from firsthand experience.

Oct. 30 marks the 36th anniversary of the FDA’s approval of human insulin synthesized in genetically engineered bacteria, the first product made with “gene splicing” techniques. As the head of the FDA’s evaluation team, I had a front-row seat. Although drugmakers and regulators were exploring unknown territory—the kind of situation that usually causes bureaucrats to dive for cover—the development of the drug and its regulatory review proceeded rapidly.

Insulin obtained from pig or cow pancreases had been available since the 1920s. But during the early 1970s, as the supply of animal pancreases declined and the prevalence of diabetes increased, fears of drug shortages spread. Around the same time, a new and powerful tool—recombinant DNA technology, or gene splicing—became available. It made possible the synthesis of high-value “foreign” proteins in genetically modified organisms.

Eli Lilly & Co. immediately saw the technology’s promise for producing human insulin in bacteria. After obtaining genetically engineered E. coli bacteria that contained the genetic directions for synthesizing human insulin, the company developed processes for large-scale cultivation of the organism and purification and formulation of the insulin.

Insulins had long been Lilly’s flagship products, and the company’s expertise was evident in the purification, laboratory testing and clinical trials of Humulin, its new human insulin. Lilly’s scientists painstakingly verified that their product was pure and identical to pancreatic human insulin.

Lilly began clinical trials in July 1980. They were done efficiently and the product performed superbly. There were no systematic problems with treating patients who had never before received insulin injections, nor with those switching from animal to human insulin. Some patients previously had adverse reactions to animal insulin but tolerated the human insulin well.

In May 1982 the company submitted to the FDA a voluminous dossier providing evidence of the product’s safety and efficacy. The agency already had extensive experience with insulins as well as drugs derived from microorganisms, and the FDA viewed recombinant DNA techniques as an extension, or refinement, of these methods. Thus regulators decided that no fundamentally new regulatory paradigms were necessary. That proved to be a historic, precedent-setting decision.

Based on my team’s exhaustive review of Lilly’s data, the FDA granted marketing approval for Humulin in October 1982. The review and approval took only five months, at a time when the agency’s average approval time for new drugs was more than 2½ years.

The back story, however, is revealing. My team and I were ready to recommend approval after four months’ review. But when I took the packet to my supervisor, he said, “Four months? No way! If anything goes wrong with this product down the road, people will say we rushed it, and we’ll be toast.” That’s the bureaucratic mind-set. I don’t know how long he would have delayed it, but when he went on vacation a month later, I took the packet to his boss, the division director, who signed off.

That anecdote is an example of Milton Friedman’s observation that to understand the motivation of an individual or organization, you need to “follow the self-interest.” A large part of regulators’ self-interest lies in staying out of trouble. One way to do that, my supervisor understood, is not to approve in record time products that might experience unanticipated problems.

The Humulin approval had significant effects. A New York Times article mentioned my prediction that the speedy approval was a major step forward in the “scientific and commercial viability” of recombinant DNA technology. “We have now come of age,” I said, and potential investors and entrepreneurs agreed. Seeing that biopharmaceuticals would compete with other medicines on a level playing field, the “biotechnology industry” was on the fast track.

The Humulin approval kicked off a new era. Drugs derived from recombinant DNA and those made with another biotech method—monoclonal antibody technology—dominated drug development. Sales are now in the hundreds of billions of dollars annually. Most important, many of them are for serious diseases that at the time of approval did not have good therapeutic alternatives.

Average drug development and approval times have never come close to those for Humulin. Government regulation hasn’t aged as gracefully as genetic engineering has.