Internal Deadlines, Drug Approvals, and Safety Problems

41 Pages Posted: 30 Jul 2019 Last revised: 20 Feb 2020

See all articles by Lauren Cohen

Lauren Cohen

Harvard University - Business School (HBS); National Bureau of Economic Research (NBER)

Umit Gurun

University of Texas at Dallas

Danielle Li

Massachusetts Institute of Technology (MIT) - Sloan School of Management

Date Written: July 26, 2019

Abstract

Absent explicit quotas or incentives, drug approvals around the world surge in December, at month-end, and before holidays. In the United States, the number of December drug approvals is 80% larger than in any other month. Similar patterns hold in the EU and in Asia. Drugs approved in December, at month-ends, and pre-holiday are associated with significantly more adverse effects, including more life-threatening incidents and deaths. Our results suggest that regulators rush to meet internal production benchmarks associated with salient calendar periods: such "desk-clearing" behavior leads to lax review, resulting in both increased output and increased safety issues.

Keywords: Deadline, Adverse effect, FDA, Drug approval

JEL Classification: D91, G41, H75, I11, L65, K23, K32, I18, O32

Suggested Citation

Cohen, Lauren and Gurun, Umit and Li, Danielle, Internal Deadlines, Drug Approvals, and Safety Problems (July 26, 2019). Available at SSRN: https://ssrn.com/abstract=3427338 or http://dx.doi.org/10.2139/ssrn.3427338

Lauren Cohen

Harvard University - Business School (HBS) ( email )

Rock Center 321
Soldiers Field
Boston, MA 02163
United States

HOME PAGE: http://www.people.hbs.edu/lcohen

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Umit Gurun (Contact Author)

University of Texas at Dallas ( email )

2601 North Floyd Road
Richardson, TX 75083
United States

HOME PAGE: http://www.umitgurun.com

Danielle Li

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

100 Main Street
E62-416
Cambridge, MA 02142
United States

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