Study Finds FDA Action on Unapproved Drugs Led to Higher Prices, Longer Shortages

Posted 27 September 2017 By Michael Mezher


A new study finds that the US Food and Drug Administration's (FDA) 2006 initiative to get manufacturers selling unapproved drugs to submit the drugs for approval or remove them from the market led to higher prices and longer shortages for those drugs.


Today, drugs must be reviewed by FDA for safety and efficacy or in some cases conform to an over-the-counter (OTC) monograph before they can be marketed in the US. However, in the years between the 1938 Food, Drug and Cosmetic Act and the 1962 Kefauver-Harris Amendments, drugs only needed to demonstrate evidence of safety to be marketed.

While many of those drugs were removed from the market or reviewed for efficacy under the Drug Efficacy Study Implementation (DESI) review program established under the Kefauver-Harris Amendments, hundreds have remained on the market for decades.

To address those products, FDA launched the unapproved drugs initiative (UDI) in 2006, requiring the manufacturers of unapproved drugs to submit the drugs for approval or withdraw them from the market. To notify manufacturers of their obligations, FDA either sent warning letters over specific products or posted notices in the Federal Register for specific unapproved ingredients, such as this 2007 notice for unapproved products containing hydrocodone.


According to the authors, FDA targeted 34 classes of drugs under the unapproved drugs initiative between 2006 and 2015.

Of those 34 drug classes, the authors found that at least one drug from 19 of the classes went on to be approved, either voluntarily or after FDA regulatory action, during those years.

To determine the effect of the initiative on the prices of those drugs, the authors looked at the change in average price for each drug in the two years before and after the drug faced regulatory action under the unapproved drugs initiative or was voluntarily approved.

The authors were able to find annual wholesale price data for drugs in 26 of the 34 classes. For those products, the authors say the lowest average wholesale price rose by a median 37% [interquartile range (IQR): 23%=204%) over the two years before and after FDA action or voluntary approval.

The authors also say they were able to find prices for 10 specific drugs that were either identified as "marketed without an approved NDA" in FDA's Drugs@FDA database or whose manufacturers were sent an unapproved drugs initiative warning letter that later went on to be approved.

"The prices of these 10 drug products increased from immediately before obtaining approval to immediately after by a median of 122% (IQR: 10%-351%)," the authors write.

The authors found a statistically significant increase in the number and duration of shortages following FDA action or voluntary approval. Half of the 34 drug classes experienced shortages in the two years before voluntary compliance or FDA action, while almost three-quarters (73.5%) experienced a shortage in the two years after. The duration of the shortages also rose from a median 31 days to 217 within the same time periods.

The authors also looked at the types of data used to support the approval of these previously unapproved drugs. Of the 19 that went on to be approved, only two were supported by new clinical trials, and the rest were supported either by literature reviews, bioequivalence studies or both.

"These findings suggest that the UDI had the unintended consequence of increasing drug prices and shortages, while rarely generating additional clinical evidence of safety or efficacy," the authors write.


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Categories: Drugs, Submission and registration, News, US, FDA

Tags: Unapproved Drugs, Unapproved Drugs Initiative, Shortages, Drug Pricing

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