EMA: Opportunity Costs of Risk-Averse Approaches Must be Taken into Account by Regulators

As those in the regulatory profession well know, there is a cost to action, and a cost to inaction. Performing an audit of a manufacturing plant might cost $200,000, but not conducting an audit could result in regulators finding previously unknown problems and shutting down a plant, costing tens of millions in lost revenue.

The same is true for regulators. Approving a drug with notable side effects might harm patients, but not approving the same drug might deprive other patients of a life-saving or -enhancing benefit.

Now the European Medicines Agency (EMA) says it wants to make sure it isn't being excessively risk-averse in its regulatory decision making for new drugs.

An Eye on Risk Aversion

In a 15 November article published in the journal Nature Reviews Drug Discovery, some of EMA's top regulators-among them Executive Director Guido Rasi, Senior Medical Officer Hans-Georg Eichler and CHMP Chair Tomas Salmonson-make the case that too little emphasis is placed on the risks of not approving a drug for use.

"The negative consequences of regulatory tolerance in allowing drugs onto the market that turn out to be unsafe are obvious, but the potential for adverse effects on public health owing to the absence of new drugs because of regulatory risk-aversion is less apparent," they write.

While some of the risks to inaction are obvious, such as patients being denied a treatment that might help them, others are less obvious. Regulators pointed to "opportunity costs" as being one poorly understood metric.

"All research and development resources are finite," they observed. "Hence, the request from a regulatory agency for more data to reduce uncertainty about one product will not only delay the potential public health benefit from that medicine, but will also have the indirect and unintended consequence that the resources required are no longer available for R&D into another medicine that might yield more public health gain."

The authors of the Nature paper stipulated that there was likely a point of regulatory vigilance against drug-induced harms beyond which the benefit to public health will experience diminishing returns. Actions beyond this point would eventually lead to a situation in which increasing opportunity costs and improperly denied treatments served to hurt, rather than help, the public.

Finding the "sweet spot" of regulatory action is the key-and challenge-for regulators, they said. And this challenge is not confronted by regulators in a vacuum, they noted. Patients, doctors, advocacy groups, industry and the public in general all have different perceptions of risk, all of which influence how regulators must weigh their own decision-making to approve (or withdraw approval for) a product.

What Can be Done?

What is clear to EMA, they said, is that "over-adherence to 'first do no harm,' or a rigid interpretation of the precautionary principle, may not be the best guide to regulatory decision-making." But since excessive caution is not perceived as having the same negative effects as expeditious approval, what can regulators do to confront this imbalance?

No one approach will suffice to solve the problem, the authors argue, but several approaches may prove useful in blunting its effects. For one, involving patients more closely in the regulatory process will allow regulators to better assess their tolerance for risk without making assumptions and "ultimately inform licensing decisions."

Second, the use of quantitative modeling may remove subjective biases from the regulatory process. While challenges admittedly remain to their implementation, regulators said that once properly validated they will "not only serve to better explain licens­ing decisions to external stakeholders but also enable regulators to move away from 'first do no harm' by incorporating, in a fully transparent way, patients' values into the decision-making process."

Third, the authors said public debates over "tolerability of risk" (ToR) thresholds would be useful, as "some small increases in the incidence of an adverse health outcomes as a result of drug treatment are neither avoidable nor accurately quantifiable, and must therefore be considered at least tolerable." To date, such ToR thresholds are "uncommon in the field of drug evaluation and regulation," the authors observed.

Fourth, to facilitate faster decision-making, regulators will need to continue to leverage post-marketing surveillance techniques, the authors said. This will also allow regulators to assess the accuracy of their decision making and calibrate risk tolerability models.

Fifth, EMA regulators wrote that they should be "allowed to factor opportunity costs explicitly into the development of evidentiary standards and into individual drug licensing decisions."

"It is not only [regulations'] effect on prices of the successful drugs that needs to be considered but also the impact on drugs that will not be developed: 'the unseen,'" the authors wrote.

Nature Paper

EMA Statement