The FDA Approval Process Explained
Since the Food and Drug Administration (FDA) was formed in 1906, its purpose has been to ensure that any food item or drug consumed by a U.S. consumer is safe. For as long as the FDA has existed, companies have gone through its rigorous approval process to put drugs and other treatments on the market. Today, taking a drug or treatment all the way through the FDA approval process often costs over $1 billion ($50-$840 million to go through Phases I and II, $50 - $970 million to go through clinical trials) and can take over 10 years. In fact, drug development has become slower and more expensive over time, with R&D costs (including costs to obtain FDA approval) roughly doubling every nine years (known as Eroom’s Law). Despite these high barriers to entry and the extensiveness of the approval process, throughout the COVID-19 pandemic the integrity of the FDA approval process has been under question by some. However, most people do not know the inner workings of this process. This article will walk through how a drug progresses through the various phases of the FDA approval process and explore how a drug can be fast-tracked for approval.
Phase-by-Phase Breakdown of the FDA Approval Process
The FDA approval process can be broken down into five phases, with each having distinct requirements and associated procedures.
Phase I: Discovery & Development
Discovery involves the identification by company researchers of a possible new medication based on testing of molecular compounds, unexpected effects from existing treatments, or the creation of a new technology.
Drug development occurs after a possible new medication or treatment has been identified. During drug development, research is conducted on appropriate dosing, ideal methods of administration, side effects (and variance across demographic groups), how the drug is absorbed, metabolized and excreted; synergistic interactions (how the drug interacts with other drugs in a given person’s system), and effectiveness compared with similar medications or treatments.
Phase II: Preclinical Research
Drugs and treatments are first administered to animals to test for toxicity. Multiple species are used to gather basic information on the safety and efficacy of the drug or treatment being investigated. This testing can be done in one of two ways: in vitro or in vivo. In vitro experiments take place outside of a living organism (often in extracted tissue) and in vivo experiments take place in a living organism. Both kinds of preclinical experiments must follow Good Laboratory Practices (GLP), which outline basic requirements for researchers, facilities, equipment, and other components of the experiments.
Next, the drug sponsor (company or entity funding drug development and progression through the FDA approval process) must submit an Investigational New Drug (IND) application to the FDA based on the results from initial testing that include the drug/treatment’s composition and manufacturing process, as well as a plan for testing the drug/treatment on humans.
The FDA then reviews the IND to ensure that the proposed clinical trials (human trials) do not place participants at an unreasonable risk of harm. The FDA also verifies that the drug sponsor has evidence of adequate informed consent and test subject protection.
Phase III: Clinical Trials
Upon the approval of the IND application, permission is granted to the drug sponsor to begin clinical trials. Clinical trials are split into three sub-phases:
Phase I
In Phase I of clinical trials, 20-80 healthy human volunteers are administered the drug/treatment. This first study emphasizes safety, with the primary goal of the study being to determine what the drug/treatment’s most frequent side effects are and often, how the drug is metabolized and excreted, and what dosage the drug should be administered at. This phase takes for up to a year and about 70% of drugs/treatments pass through this phase to Phase II of clinical trials.
Phase II
In Phase II, hundreds of participants are tested and this time, the participants are patients who have the disease or condition that the drug aims to address. As such, Phase II emphasizes effectiveness of the drug/treatment. In controlled trials, patients receiving the drug are compared with similar patients receiving a different treatment (either a placebo or a different drug). Safety and short-term side effects continue to be evaluated. This phase can last from a few months to two years and only around 30% of drugs in this phase move on to Phase III.
Phase III
This phase involves several thousand patients with the targeted disease or condition, tested over a span of up to four years. Safety and efficacy are continually monitored in this phase. The main goals of this phase, however, are to test the long-term effects of the drug, how the drug or treatment affects people from different demographics, how different dosages affect patients, and what synergistic effects of the proposed drug there may be. If the drug or treatment passes this phase, it continues to Phase IV of the overall FDA approval process. About 25% - 30% of drugs in this phase move forward.
A Final Note on Clinical Trials
Drug sponsors can hypothetically conduct as many clinical trials they want and only submit to the FDA results that support their drug’s effectiveness and safety. However, not only is this rarely attempted in practice, but the cost of employing this strategy to get an unsafe, ineffective drug approved far exceeds the average total approval and go-to-market cost of $1 billion. Think of how many more clinical trials, each with hundreds to thousands of volunteers and even more doses of the drug, would have to be conducted to prove a bad drug to be effective and safe. With very few exceptions, the risks of not getting approved and having absurdly high costs far outweigh the potential benefits of trying to get an unsafe, ineffective drug approved. There are only a small handful of large pharmaceutical companies with the financial resources to even attempt such a feat. For all other companies, the costs of this strategy are prohibitively high. With 63% (and rising) of new drugs and treatments being produced by small to mid-sized biopharmaceutical companies, the likelihood of a given drug being passed in this manner is becoming increasingly small. While a few drugs, like OxyContin, have been passed in this manner before, it is incredibly unlikely that a given drug or treatment has been passed due to such masking of unsafety and/or ineffectiveness.
Phase IV: FDA Review
Once a drug sponsor has ample evidence through clinical trials and other research that their drug or treatment is safe and effective in treating a condition, they have a review meeting with the FDA. Here, they go over additional data or experiments that the FDA may require for the drug sponsor’s New Drug Application (NDA).
The drug sponsor then formally asks the FDA to approve a drug for marketing in the United States by submitting an NDA. The NDA includes all animal and human data and analyses of the data, as well as information on how the drug or treatment behaves in the body, labeling, safety, drug abuse potential, patients, directions for use and how the drug is manufactured. Once the NDA is submitted and received, the FDA has 60 days to decide whether to file it so it can be reviewed. Often, the FDA may request additional information before filing. If the FDA files the NDA, the FDA review team is assigned to evaluate the sponsor’s research on the drug’s safety and effectiveness.
The FDA review team carefully and methodically reviews all submitted information. Aside from reviewing the NDA in this process, the FDA will also review the drug’s professional labeling to ensure appropriate information is communicated to healthcare professionals and consumers. They will also inspect the facilities where the drug will be manufactured.
Finally, after approximately 6 - 10 months, the FDA review team will either approve the application or issue a response letter. If the drug is approved, the FDA then works with the drug sponsor to develop prescribing information and the drug or treatment moves on to the next phase. Less than 5% of proposed drugs or treatments ultimately become FDA approved.
Phase V: Post-Marketing Monitoring
The last phase of FDA approval is an ongoing one that takes place while a drug is on the marketplace. The goal of this phase is to monitor the drug or treatment post-marketing for any signs of serious unexpected adverse effects and to take definitive action when necessary. During this unending phase, the drug sponsor is required to submit periodic safety updates to the FDA on a continual basis. The FDA reviews these updates, as well as the drug’s advertising and its manufacturing facility to ensure that everything involved in the drug’s creation and marketing is in compliance with regulations.
Additionally, the FDA’s MedWatch system allows physicians and consumers to report any adverse effects that were not previously identified or stated by the drug sponsor. Usually, when important new risks are uncovered, they are added to the drug’s labeling and the public is informed of the new information through letters, public health advisories, and other education. In some cases, the use of the drug must be substantially limited and in rare cases, the drug must be withdrawn from the market.
New drugs are almost always protected by patents or other intellectual property (IP) while on the market. Generic drugs can only be manufactured once the patent or other IP on the original drug expires. Generic drugs must contain the same dosage form, strength, safety, quality, and intended use.
Circumstances for Fast-Tracking Approval
There are four ways that the approval of a new drug can be expedited:
Accelerated Approval: Established in 1992, this pathway can be applied to promising therapies that treat a serious or life-threatening condition and provide significant therapeutic benefit over available therapies. Accelerated approval requires the demonstration of an effect on a “surrogate endpoint” that is reasonably likely to predict clinical benefit - or on a clinical endpoint that occurs earlier but may not be as robust as the standard endpoint used for approval. This pathway is most often used when the drug or treatment is meant to treat a disease whose course is long, requiring an extended period of time to measure the drug or treatment’s effect. After the drug goes to market, the drug sponsor is required to conduct post-marketing clinical trials consistent with the traditional FDA approval process. If these trials fail to verify the predicted clinical benefit, the FDA may withdraw approval. Some notable examples of drugs that were successfully approved, brought to market, and quickly made a significant impact on a condition in this way include many antiretroviral drugs used to treat HIV/AIDS and a number of targeted cancer-fighting drugs.
Drug Development Designations, in many cases, are also being employed by the FDA to encourage the development of certain drugs or treatments — especially drugs or treatments that may represent the first available treatment for an illness or ones that have a significant benefit over existing drugs. An NDA may receive more than one designation, if applicable. Each designation serves the purpose of ensuring that treatments for serious conditions become available to patients as soon as the FDA review team can conclude that their benefits justify their risks. Serious conditions are defined as having a profound impact on factors such as survival, day-to-day functioning, or the likelihood that a disease will become more severe if left untreated.
Fast Track: This process is designed to facilitate the development and expedite the review of drugs that treat serious conditions and fill an unmet medical need, based on promising animal or human data. Filling an unmet medical need is defined as providing a drug or treatment for a condition where none currently exists, or providing a drug or treatment which may be potentially better than available therapy. If there are available drugs or treatments for a condition, a new drug must show some advantage over the available alternatives to receive the Fast Track designation, including:
Showing superior effectiveness or improved effect on serious outcomes
Avoiding serious side effects of an available alternative
Improving the diagnosis of a serious condition where early diagnosis results in an improved outcome for patients
Decreasing a clinical significant toxicity of an available alternative that is common and causes discontinuation of treatment
Ability to address emerging or anticipated public health need
A drug or treatment that receives this designation may be eligible for more frequent meetings with the FDA to discuss the drug’s development plan and ensure collection of appropriate data needed to support drug approval, more frequent written communication from the FDA about things such as the design of the proposed clinical trials, and eligibility for Accelerated Approval and Priority Review if relevant criteria are met. This designation must be requested by the drug sponsor.
Breakthrough Therapy: This designation expedites the development and review of drugs or treatments intended to treat a serious condition, that also have preliminary clinical evidence indicating that the drug or treatment may be a substantial improvement over available alternatives. The goal of this designation is to develop evidence needed to support approval as efficiently as possible. This designation must also be requested by the drug sponsor. A drug or treatment that receives Breakthrough Therapy Designation is eligible for all Fast Track designation features, intensive guidance on an efficient drug development program (beginning as early as Phase 1), and organizational commitment involving senior FDA managers. While the use of this designation does accelerate the approval process, it also comes with increased scrutiny from the FDA on research practices determining the safety and effectiveness of the new drug or treatment.
As can be seen, the FDA has a thorough approval process for vetting the safety and efficacy of drugs and treatments. This process, with few exceptions, has successfully prevented harmful treatments from entering the market, even in the event of a fast-tracked approval.
Very informative. This helps explain why the new vaccines were such a remarkable accomplishment