Key Aspects of Regulatory Approval for New Drugs

In this Q&A, Francisco Polidoro, Junior, PhD, discusses the basics of the drug review and approval process, current challenges, and areas for improvement

Francisco Polidoro, Junior, PhD.

Francisco Polidoro, Junior, received his PhD in strategy from the University of Michigan and is currently an associate professor at The University of Texas at Austin. His research focuses on the competitive and collaborative strategies of technology-based companies, with an emphasis on interactions that companies have with outside parties such as regulatory agencies, the scientific community, brokerage firms, and the media. His research has appeared in the most prestigious management journals–Academy of Management Journal, Academy of Management Review, Administrative Science Quarterly, Organization Science, and Strategic Management Journal. In addition to having been a member of the editorial review board of all these journals, he is currently serving as deputy editor and senior editor at Organization Science.


Q: For those not familiar with the drug review and approval process, what are the key steps?

A: [US]Food and Drug Administration (FDA) reviewers are involved with the development of a new drug when it is still in an investigational stage—long before it is under review for approval. The formal review process starts once a company files a new drug application, which typically contains very extensive evidence collected through clinical trials to investigate the efficacy and safety of that new drug. An FDA review team then evaluates whether the studies submitted by the sponsoring company demonstrate that the new drug is both safe and effective for its proposed use.  Members of this review team span several areas of expertise, including medical doctors, chemists, statisticians, and pharmacologists.  Each of these reviewers submits conclusions and recommendations about the application. These written evaluations are then considered by the FDA. When a new drug class, or a new way to treat a given indication is submitted, the FDA may seek additional advice from an advisory committee composed of outside experts who offer independent recommendations. The FDA then makes a final decision and issues an action letter officially communicating that decision to the company sponsoring that new drug.

Q: How long does the review process typically take?

A: The length of the review process can be highly variable. It depends on the details of the new submission. Sometimes the review of a new drug lasts only a few months; sometimes it takes several years for a new drug to be approved. The FDA is currently targeting this process to take about 10 months. 

The key to the process is evaluating whether the benefits of a new drug outweigh its risks. This task entails substantial uncertainty, and the degree of uncertainty varies from drug to drug. For example, when a new drug achieves the intended therapeutic effect through a well-known pharmacological mechanism of action, its review benefits from that previous information. Similarly, when a new drug is the first one for the proposed indication, its review is surrounded by higher uncertainty when compared to drugs that target a medical condition that is well understood. 

Drugs that represent a significant clinical improvement relative to existing drugs can receive priority review designation. In those cases, the FDA aims at making decisions within six months.

Q: Why does it take drug reviewers more time to approve new drugs when they have more information about existing drugs?

A: There are several reasons contributing to differences in review times across drugs. My research on 291 new drugs based on new molecular entities and approved between 1980 and 2014 showed that the more knowledge there is about drugs with the same indication, but built on a different pharmacological mechanism of action, the longer it takes to review. We tend to think of knowledge as a facilitator, but in this case, knowledge can actually become a hindrance, if we lose perspective on the data. Drugs that build on different mechanisms attack the same therapeutic condition in different ways, which affects which clinical outcomes are relevant to evaluate their efficacy and safety. When the review of a new drug takes place against the backdrop of more information about these alternative drugs, there are a greater variety of outcomes related to efficacy and safety that reviewers need to consider. 

Q: What are some solutions to delays in drug approvals?

A: The FDA has a crucial role in evaluating new drugs to ensure that their benefits outweigh their risks. To do so, the FDA considers the best scientific and technological information available to guide decisions on new drug approvals. An important first step toward avoiding delay in drug approvals is to recognize the similarities and differences for different types of drugs with similar indication. Different mechanisms of actions may lead to different potential adverse outcomes. The challenge lies in fine-tuning the existing understanding, discerning which concerns extend to the new drug under review and which do not.

Q: Why can the review of innovative drugs be beneficial to subsequent new drugs?

A: New drugs that pioneer a new pharmacological mechanism of action in a therapeutic class are more innovative than those that build on well-known mechanisms. The review of these innovative drugs faces challenges because the clinical outcomes related to that novel mechanism need to be evaluated against the backdrop of well-known mechanisms. This increases the diversity of issues that need to be considered before approval. This more challenging review also produces an important and beneficial learning effect to the review of new drugs further down the road. In trying to understand those innovative drugs from the perspective of existing drugs, regulators develop a more fine-grained understanding about similarities and differences that exist across different types of drugs. For the next review, they become better able to apply pertinent information about existing drugs that helps them understand that new drug, while filtering out information that is not relevant to its evaluation. Although the process of evaluating those more innovative drugs is challenging, it offers context to regulators to learn how to better transfer knowledge while preventing knowledge misapplication in the review of subsequent drugs.

Q: What needs to be done going forward to ensure that innovative drugs are approved in a timely matter, yet their safety is still assured?

A: Innovative drugs hold the promise of increased efficacy or diminished safety concerns. However, there is a tendency to view these innovative drugs based on the efficacy and safety considerations that apply to existing drugs. It is important that the review of innovative drugs have the right context with respect to the backdrop of existing drugs to avoid the inappropriate use of information. Innovative drugs likely have different tradeoffs between efficacy and safety. They may produce increased efficacy at the expense of increased concerns with adverse effects. They may even underperform in certain clinical outcomes relative to existing drugs, but outperform in other meaningful clinical outcomes that are relevant to certain patients. We are all better off when there is a diversity of drug types that stand the rigorous scrutiny of the FDA because that also helps address the diversity that exists across patients affected by similar medical conditions. 

Q: What key suggestions do you have for pharmaceutical companies to ensure the drug review and approval process goes as smoothly as possible? 

A: Pharmaceutical companies invest a lot of time and money in the creation of new drugs. Different companies adopt different approaches to finding therapies for a given medical condition. We all benefit from the existence of different types of drugs that achieve the intended effect in different ways, and this entails different tradeoffs of efficacy and safety. To ensure that the review of new drugs goes as smoothly as possible, there are a few things that pharmaceutical companies can do. 

First, they can ensure that their internal teams dedicated to the clinical development and approval of new drugs mirror the diversity of expertise that the FDA uses to evaluate new drugs. Adopting cross-disciplinary teams allows companies to view their own drugs through a similar prism used by the regulators and allows them to anticipate some of the concerns that may arise during the drug review and approval process. This will enable them to spot concerns that might arise early in the process and help them adopt a more proactive stance, compiling evidence that helps preempt or mitigate those concerns. 

A similar structure to the review team also produces more fluid communication during the review process. If the FDA requires additional information, this cross-functional team is well-equipped to understand the concerns from the perspective of those reviewing their drugs, and more expeditiously submit the additional evidence addressing those concerns. Despite all these efforts, sometimes issues emerge hindering the approval process. Learning about the underlying reasons can benefit the approval of subsequent drugs. Thus, the second recommendation is for pharmaceutical companies to promote collaboration and communication between their teams involved in the development and approval of different drugs over time.