Investments in clinical development programs, including those for new treatments for existing conditions, are influenced by the policy, business, and legal environment. “Carrots” such as faster drug approval or longer exclusive rights to a patented drug encourage more clinical development. “Sticks” such as price controls or other financial penalties, tend to slow down or halt clinical development.
There are oppositional influences on clinical development in the U.S. when multiple drugs are developed for one condition, this can be characterized as wasteful, or as a benefit to health. Some people find one medication that is more tolerable or efficacious, or they need to switch to another medicine if their health condition stops responding to treatment.
Right now, there is an ongoing lawsuit filed by a group of patients challenging a drug company’s decision to not advance one HIV drug candidate more quickly. Then there is the push and pull environment in Alzheimer’s disease – a new drug for Alzheimer’s disease was rapidly approved by one government agency, but then its reimbursement and use was restricted by another government agency.
At the same time, the Inflation Reduction Act will set the prices for big drugs, including those with multiple therapeutic uses, but will not affect the prices of niche medicines for one condition. If we want to see multiple drugs available for treating health conditions, then penalties for developing a safe and efficacious drug should be avoided.
These ambivalent positions, whether established through legal or policy precedent, increase the risk of an already risky clinical development investment. Delving into the details, in the lawsuit, the plaintiffs’ lawyers are challenging a drug company’s decision to not advance one HIV drug candidate more quickly, although they acknowledge the earlier FDA-approved medication was efficacious and not defective. They argue that the drug company should be held liable for not developing the later candidate faster. If there are penalties for developing a drug “too slow” this discourages investment in any next-generation drugs, because it will be ambiguous about what is fast enough.
In a different example of ambivalent policy, The Center for Medicare and Medicaid Services restricted reimbursement, and use, for an FDA-approved Alzheimer’s medication, largely because there was limited evidence, resulting from the drug being developed quickly with an FDA pathway established to approve a critical drug quicker.
Finally, the Inflation Reduction Act will have the government set the prices of approved medications that are broadly used by seniors and disabled people in Medicare. If a drug is developed to treat multiple conditions, a relatively quicker way to develop a drug for therapeutic use, the government will lower the drug’s price for all approved uses, thus penalizing follow-on clinical development that will expand a drug’s use and making niche one use clinical development, that is more expensive, a better investment.
Major events like infectious pandemics motivate policymakers and private industry to extraordinary action with purchase commitments and scientific collaboration. Understudied conditions like rare diseases or conditions that afflict lower-income countries are offered special incentives to encourage more and faster clinical development and new drugs as a result. These events, whether it be a lawsuit, a law, or a reimbursement decision, influence what drugs get developed. Penalizing a drug developer for not developing a drug quickly enough will not result in drugs being developed faster, as any organization, including government and academic institutions, they just discourage all investment in drugs for existing conditions, meaning slower or less new medicines.
There is no perfect system. There are finite patients for clinical trials, limited financial resources and capacity to advance scientific programs in the public and private sector. Investors (in universities, private equity, in government and in private industry) make choices about where to place their time and money. Drugs will be left behind that are promising. However, there are government programs for these “abandoned” medicines. This type of incentive helps advance promising treatments that may not be a priority for drug developers. But the scale and funding available is tiny relative to private industry drug development.
The courts, policymakers, and implementing agencies can establish policy and precedent that encourages the next generation of new drugs with thoughtful incentives, including those drugs that are the second, third, or fourth for a disease but have health or well-being benefits to patients. Iterative development builds on existing science and safety data. Penalties for moving too slow or too fast will discourage the development of medicines for diseases where there is already a treatment. But consider, that there have been treatments for cancer, arthritis, and schizophrenia for decades… would we want the medicine of the 1970s today?