According to an analysis by BioMedTracker that was commissioned by Forbes Magazine, 89% of drugs that were submitted for approval to FDA were given the green light this year. That means FDA has only rejected three uses for new chemical entities. This on the back of an 88% approval rate in 2014.

This is an astonishing approval rate, especially when considering that in 2008 only half of the drugs submitted to FDA were approved. Of course, there are a lot of explanations for why this is occurring. Matthew Herper, staff writer for Forbes that covered the analysis, provides nine such explanations in a follow up article to his original post about the analysis. From his explanations the reason we found the most striking, was his last: In the current political environment, the agency is approving drugs it shouldn’t.

If this is an accurate portrayal of what is occurring, then we are entering into a new era, where post-approval drug safety surveillance will be more important than ever. Warning sirens should be going off throughout every managed care organization, integrated delivery network and payer globally (Hereafter referred to as managed care organizations or MCO) who bear the brunt of the financial risk. They are being forced into a position in which they will not only need to conduct initial comparative effectiveness research to determine formulary placement and utilization, but also need to invest in, and establish significant in-house post-marketing safety surveillance to avoid, and preempt costly adverse events.

This kind of rampant approval rate, in combination with the lack of FDA resources and funding, means there is no possible way the agency itself can be relied on by MCOs for comprehensive post-marketing safety surveillance and reviews. By the time FDA identifies an issue, and the manufacturer and FDA negotiate the label change or other safety action, millions of dollars in adverse event related downstream medical costs have already been accrued by the MCO, not to mention the significant patient harm that could be avoided. In addition, as we pointed out in our blog post, The State of Drug Safety Systems, even though the FDA is focused on investing in big data capabilities and complicated active signal detection technology such as Sentinel, there are significant drawbacks and limitations to these efforts that will not be quickly resolved. Surely not in time to deal with the influx of new drugs hitting the market.

The costs of establishing a post-marketing surveillance program within a MCO do not have to be egregious. In soon to be released research we will be presenting results that demonstrate the power of foretelling FDA safety actions via our RxSignal analytic, which identifies future label changes up to 5 years prior to FDA communication, with an impressive success rate and minimal false positives. This preemptive warning is vital in this new paradigm.

Bringing new drugs to market to treat disease is a great thing, and as Herper fairly points out, drug companies are getting better at research and producing better drugs, which is certainly one of many factors driving up approval rates. But this does not belie the fact that more drugs—expensive drugs—are flooding the market each year and these drugs are not being properly monitored, independent of FDA and the manufacturers. Without adapting their workflow to account for the new era of drug safety concerns that we have entered, MCOs are putting themselves, and patients at risk.

To start the path towards risk mitigation, request access today to a complimentary subscription to the Drug Safety Monitor (For qualified MCO’s Only).


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Jim Davis

Jim Davis

Executive Vice President

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Jim Davis

Written by Jim Davis

As Executive Vice President, Jim is responsible for the commercialization strategy for Advera Health Analytics.