The Information Prescription for Drug Regulation
86 Pages Posted: 16 May 2006
Date Written: May 15, 2006
Before it can sell a prescription drug lawfully in interstate commerce, a manufacturer must prove to the satisfaction of the Food and Drug Administration that the drug is both safe and effective. Congress approved this requirement in 1962 unanimously. Four decades of changes in the drug market have reshaped this regulatory hurdle.
This article makes detailed reference to these transformative developments to argue that the statute's adjectives have merged into one unitary inquiry about utility, a multifaceted query that many sectors ask and answer. Because consumers - that is, patients, physicians, managed-care organizations, and third-party purchasers like employers - cannot resolve this query without information, revealing information lies at the heart of the safe and effective regulatory promise.
We locate in the Food, Drug and Cosmetic Act an obligation for regulators to foster the revelation of known (or readily knowable) information that consumers need to determine whether a drug offers value. We give examples of particular drugs that were marketed without the information that would have given a more accurate picture of their utility to show that this shift in regulatory policy would not only fulfill the statutory mandate, but also repair a market failure for the benefit of consumers.
Keywords: drugs, pharmaceutical, prescription, regulation, information, consumer, medical, FDA, MCO, Vioxx, medical informatics, evidence-based medicine
JEL Classification: D40, D80, D83, I18, K23, K32, L51, L65
Suggested Citation: Suggested Citation