Internal Deadlines, Drug Approvals, and Safety Problems

44 Pages Posted: 16 Nov 2020

See all articles by Lauren Cohen

Lauren Cohen

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

Umit G. Gurun

University of Texas at Dallas

Danielle Li

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

Multiple version iconThere are 2 versions of this paper

Date Written: November 2020

Abstract

Absent explicit quotas, incentives, reporting, or fiscal year-end motives, drug approvals around the world surge in December, at month-ends, and before respective major national holidays. Drugs approved before these informal deadlines are associated with significantly more adverse effects, including more hospitalizations, life-threatening incidents, and deaths – particularly, drugs most rushed through the approval process. These patterns are consistent with a model in which regulators rush to meet internal production benchmarks associated with salient calendar periods: this “desk-clearing” behavior results in more lax review, leading both to increased output and increased safety issues at particular—and predictable—periodicities over the year.

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Suggested Citation

Cohen, Lauren and Gurun, Umit G. and Li, Danielle, Internal Deadlines, Drug Approvals, and Safety Problems (November 2020). NBER Working Paper No. w28071, Available at SSRN: https://ssrn.com/abstract=3731240

Lauren Cohen (Contact Author)

Harvard University - Business School (HBS) ( email )

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Umit G. Gurun

University of Texas at Dallas ( email )

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Danielle Li

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

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