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Health Economics and Regulation

Regulation Continueo Kefauver Harris Act of 1963 o Made drugs safer, good housekeeping skill o Augmented them to sell large amounts of the drugs human beings and FDA has 30 days to object o 3 phases of testing a small group of healthy volunteers -- looking for side effects and something that can stop the trial right now most part has already tested on nonhuman primates few dozen of sick patients -- whether the drug actually does anything favorable double blind large sample testing with long term toxicity testing in parallel -- random testing -- most expensive part o Takes several years o About 25% of those that enter phase 1 emerge for an NDA (new drug approval) Effects of Regulation Increased costs Decreased innovation? But could also have increase sales due to better information Overall evidence suggests consumer loss initially;modified with increased funding of FDA -- faster approval processes Fewer new chemical entities (NCEs) approved at theonset Regulations -- Who does the review and pays for it? 1992 -- PDUFA -- Prescription Drug User Fee Act o Created a stream of funding for the FDA -- and without this, FDA would have shut down Balancing the budget 1997 -- PDUFA reauthorization every 5 years Increased funding; decreased backlog and time-to decision DTC Ads -- direct-to-consumer advertising DTC -- talks about all the symptoms and tells you to go see your doctors asap Specifically authorized by the K-H which granted FDA to regulate labeling and advertising 1969 - ads must present fair balance of info about risksand benefits General evidence that DTCs work o Increases demand for drugs and not quality of care or whatever Ads do not have to be submitted to FDA in advance,though many are in order to solicit advice Only 3 countries in the world have this Horrible because patients think that they have this illness and ask for the drug FDA regulates prescription drug ads and FTC regulates OTC Promotional Spending by Type of Prescription Drug Expanded Access 1987 -- partly in response to HIVIAIDS epidemic Treatment Investigational New Drug Manufacturers may provide unapproved drugs to patients who meet specific criteria if no other therapies are available Phase I must be completed Well over 40 drugs have been so approved o Cancer and HIV primarily 21 Century Cures Act Notably allows for less rigorous pre-approval testing in order to achieve faster drug approval Tied to substantial increase in NIH funding Draws bipartisan support in the House Orphan Drug Act Incentives to develop drugs for diseases that affect fewer than 200,000 people Research grants, tax breaks, and exclusivity 7 years of marketing exclusivity, even in the absence of patent protection highly successfully (as measured by approvals)2007 FDAAmendments Act (FDAAA) Take Home Points - FDA essentially powerless until 1962 - Increased regulation - Orphan Drug Act Generics Patents Three types of patent Subject matter must be sufficiently different from what has been used or described before o Therefore, a small change to a substan