Abolish the FDA!!
Jim Grichar (aka Exx-Gman)
time has long since come for the Congress to abolish the U.S. Food
and Drug Administration, also known as the FDA. Contrary to the
baloney put out on the various pages of its web site, which would
lead the unwary taxpayer into thinking that the FDA is actually
protecting him or her from some hazard, the FDA has
outlived any usefulness its partisans and bureaucrats have claimed
for it. Getting rid of this bureaucratic dinosaur would save taxpayers
nearly $1.7 billion (the proposed fiscal year 2004 budget), lead
to reductions in the prices of food and drugs paid by consumers,
reduce lawsuits over product liability, and reduce the number of
lives lost and lives shortened due to a lack of drugs and medical
the FDA claims to do
a history that dates back to 1848 when Congress required the U.S.
Customs service to prevent adulterated drugs from entering the United
States, Congress has expanded the FDA’s
regulatory authority over food and drugs over the years, all in
the name of protecting consumers from any risks associated with
food, drink, or drug use. Major milestones (or millstones,
for taxpayers and consumers) include the Food and Drugs Act and
Meat Inspection Act, both of 1906, which gave the FDA’s predecessor
agency power to enforce prohibitions on the interstate commerce
of misbranded or adulterated food, drinks, and drugs.
many of the food-related functions have been transferred to the
Agriculture Department, the FDA retains considerable authority in
this area, notably in dictating food-labeling standards and in dictating
the types of claims that can be made by manufacturers of vitamins
and mineral supplements.
far as prescription drugs go, the FDA has been given additional
authority over the years. Notably, in 1962, after the sleeping pill
thalidomide was found to have caused birth defects in children born
in Western Europe, the Congress passed and John F. Kennedy signed
into law amendments to federal drug laws that required pharmaceutical
manufacturers to prove to the FDA the effectiveness of their products
before marketing them in the United States. Despite the apparent
Congressional intent of reducing the risk of using pharmaceuticals
to zero, unsurprisingly, the FDA has failed to do so. Instead,
FDA began the process of dictating standards for clinical drug trials
and tests and conducting a lengthy approval process that a manufacturer
needed to pass before bringing a new or modified drug to market.
in 1976, the FDA was given authority to apply a similar "drug-style"
approval process to all medical instruments and medical test equipment.
FDA has failed
attempt by the government to insure consumers against the risk of
using drugs and medical devices has flopped on numerous occasions.
First of all, FDA regulations have often prevented U.S. consumers
from gaining access to new life-saving drugs. Examples of this include
major delays in the marketing of drugs used to treat cancer, blood
pressure, heart attacks, cholesterol, and strokes and delays in
marketing such high-tech items as cardiac pacemakers and in the
use of such techniques as balloon angioplasty for blocked coronary
arteries. For many years, the FDA would not allow the makers of
aspirin to claim on their product labels that aspirins thinned blood
and could thus save one from dying if taken during a heart attack.
The costs of FDA regulation of these markets has likely run
into the billions, possibly hundreds of billions, of dollars and
is composed of higher drug prices, fewer drugs, and more and lengthier
illnesses and earlier deaths.
a call to the Bush Administration to merely reform the FDA, Henry
I. Miller, a fellow at the Hoover Institution and the Competitive
Enterprise Institute and a former FDA official, presented a devastating
critique of the FDA’s regulatory process and procedures.
his early 2001 editorial commentary, Dr. Miller stated that the
total time it takes to develop a new drug had doubled since the
1960's. And the costs to a manufacturer of bringing a single new
drug to market had risen to over $400 million, the highest cost
in the world. He further contended: "Costs are spiraling out
of control because the FDA meddles endlessly in clinical trials
and keeps raising the bar for approval." Furthermore, he cited
statistics that showed the average number of clinical trials per
average drug increased from 30 in the early 1980's to 68 during
the 199495 period while the average number of patients in
clinical trials for each drug more than tripled! As expected, the
average time required for clinical trials for a new drug rose from
85 months in the first half of the 1990's to 92 months in the last
half of the 1990's.
FDA approval of a drug has not been a guarantee that one was or
is using a safe drug. This latter contention was once again confirmed
in a Sunday, May 18, 2003 New
York Times article about trial lawyers focusing their efforts
on launching mammoth lawsuits against pharmaceutical manufacturers.
without the FDA
many in the medical community like Dr. Miller believe that sensible
regulatory reform of the FDA should be the goal, instead the FDA
should be abolished.
Some possibly many are about to ask me: "Grichar, are you nuts?
What makes you, an economist and not a medical expert, think that
the drug companies and medical equipment manufacturers can be trusted
to regulate themselves!" To which I would respond, "They
will not be regulating themselves; the free market will regulate
here is how that could be done. In the absence of the FDA and with
trial lawyers looking for multi-billion dollar settlements in lawsuits,
pharmaceutical manufacturers and medical equipment manufacturers
have every incentive to be cautious in bringing out new drugs and
new medical devices. To this end, they would avail themselves of
independent private reviews of the results of clinical trials and
experts the same ones who testify on behalf of and against manufacturers
in various product liability lawsuits would also become involved
as independent private review consultants. Most likely, such experts
would become affiliated with independent private review institutes similar in operational philosophy and techniques to the famous
Underwriters Laboratories which would levy a charge for a review
of a new drug or medical device. Currently, the FDA takes in about
$250 million annually in fees (really taxes) it charges manufacturers
for seeking approval of a drug or medical device. Manufacturers
have thus demonstrated the willingness and ability to pay for product
might also help fund such independent review boards or institutes,
as this would help lower their pay-outs in lawsuits. And contrary
to what some may think, medical experts would have every incentive
mainly significant future earnings from participating in
drug and medical device and procedure reviews from the independent
review institutes not to take bribes from manufacturers.
(For a great description and analysis of what of Underwriters Laboratories
does, see What
Keeps Us Safe by Mark Thornton.)
given a seal(s) of approval by accepted review institutes, the new
drug or device would be brought to market with that seal(s) publicly
displayed. Physicians, who often have to spend a fortune for malpractice
insurance coverage, would have the strongest incentive to prescribe,
in most cases, only those drugs or those devices that have some
seal(s) of approval. Their malpractice insurer would demand that.
However, physicians would be free to seek an exemption from their
insurer and the consumer in cases where application of a new, but
not-yet mass marketed or reviewed drug or device, might make the
difference between life and permanent disability or death.
would also be given an extra incentive to seek such expert seals
of approval for their new drug and medical device products by their
insurance companies, mainly in the form of lower premiums for liability
insurance if they get a seal(s) of approval. Those not getting recognized
approval would face higher liability insurance premiums, possibly
suspension of coverage for those particular products, and likely
lower demand for such products. Getting a number of seals of approval,
from these strictly independent private review institutes, would
further enhance the marketability of a product and help insulate
the manufacturer from lawsuits.
the free market, insurers would also have the incentive to offer
consumers no-fault liability insurance for medical malpractice,
including the use of drugs and devices that have not gotten a major
seal or seals of approval by generally accepted review institutes.
And consumers would have a strong incentive to purchase such insurance.
such a private market system of insurance and risk reduction, there
would be fewer lawsuits and lower settlements. This would be the
case because of the extensive and competitive review of products,
seals of approval, and also review by various insurers. It would
be difficult for even the best trial lawyers to counter numerous
expert opinions rendered in such an unbiased manner prior to the
sale of a specific drug or medical device.
sum it up, a private market for the review of drugs and medical
devices could save the public billions
of dollars. Not only would the public (including drug and medical
device manufacturers) save the $1.7 billion it pays in taxes and
fees to fund the FDA, but effective drugs and devices would be brought
to the market more rapidly and at a lower cost. More lives would
be saved, there would be fewer permanently disabled, and illnesses
would be shortened. Lower lawsuit awards and settlements would more
than likely compensate for any extra costs of reviews.
the FDA and save lives and money!
Grichar (aka Exx-Gman) [send
him mail], formerly an economist with the federal government,
writes to "un-spin" the federal government's attempt to con the
© 2003 LewRockwell.com