Regulatory Review Time and Pharmaceutical R&D

30 Pages Posted: 5 Aug 2019

See all articles by Anna Chorniy

Anna Chorniy

Princeton University - Center for Health and Wellbeing

James B. Bailey

Creighton University - Department of Economics; Temple University - Department of Economics

Abdulkadir Civan

Gediz University

Michael T. Maloney

Clemson University - John E. Walker Department of Economics

Date Written: July 17, 2019

Abstract

In the United States, all newly developed drugs undergo a lengthy review process conducted by the Federal Food and Drug Administration (FDA). These regulatory delays are costly for drug manufacturers and patients. We collected data on review times of drugs approved between 1999 and 2005 and found that, in medical indication categories where it takes the FDA longer to approve drugs, fewer drugs are developed. On average, three additional months of the review process result in one fewer drug in development in that drug category, suggesting that the length of the regulatory delay matters for pharmaceutical firms’ research and development decisions.

Keywords: regulation, pharmaceutical R&D, Federal Food and Drug Administration, drug development

JEL Classification: I18, O38

Suggested Citation

Chorniy, Anna and Bailey, James B. and Civan, Abdulkadir and Maloney, Michael T., Regulatory Review Time and Pharmaceutical R&D (July 17, 2019). Mercatus Research Paper. Available at SSRN: https://ssrn.com/abstract=3432532 or http://dx.doi.org/10.2139/ssrn.3432532

Anna Chorniy (Contact Author)

Princeton University - Center for Health and Wellbeing ( email )

Woodrow Wilson School
Princeton, NJ 08544
United States

James B. Bailey

Creighton University - Department of Economics ( email )

2500 California Plaza
Omaha, NE 68178
United States

Temple University - Department of Economics ( email )

Philadelphia, PA 19122
United States

HOME PAGE: http://sites.temple.edu/jamesbailey/

Abdulkadir Civan

Gediz University ( email )

Menemen
Izmir
Turkey

Michael T. Maloney

Clemson University - John E. Walker Department of Economics ( email )

Clemson, SC 29634
United States
864-656-3430 (Phone)
864-656-4192 (Fax)

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