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Pink Sheet – Has R&D Productivity Rebounded? US FDA Officials Think So

Pink Sheet – Has R&D Productivity Rebounded? US FDA Officials Think So

Executive Summary

Record-setting pace of NME approvals is a cause for celebration. But is it a sign that drug industry R&D productivity has actually improved? The US FDA’s top drug review official thinks so – but the data aren’t yet clear.


The US Food & Drug Administration is already in record territory with 55 new molecular entity/novel biologic approvals already in 2018, with almost three weeks still left in the year.


That breaks the single-year record of NME approvals set in 1996 (53). And, perhaps more impressively, it brings FDA’s two-year approval total to 101—well above the past record of 92 in 1996-97. (Also see “US FDA Blows Past Novel Approvals Record On Way To Unprecedented Year For New Drugs” – Pink Sheet, 28 Oct, 2018.)


High NME approval tallies are always a good news story for FDA, and a couple of good years during an approval-oriented era at FDA should put drug industry R&D executives in the holiday spirit as well.


But what if this is more than “just” a record year. What if it is evidence that, at long last, drug industry R&D productivity has started to improve? That would be a real cause for celebration.


Well, FDA’s top new drug official – Center for Drug Evaluation & Research Director Janet Woodcock – things it is just that.


“I think for the first time the pharmaceutical industry’s productivity has gone up – like a jump,” she said during the Prevision Policy/Friends of Cancer Research Biopharma Congress in November. “For 30 years, it was a stable number of NME output despite increasing and increasing investment,” she said, noting that “people call that Eroome’s law, the opposite of Moore’s law.”


The investment in molecular genetics – including a significant federal investment via the National Institutes of Health – has led to a “scientific revolution” and a wave of new targeted therapies, Woodcock said. At the same time, she said, “regular science” has progressed rapidly, “so we know more about many other diseases, not just genetic diseases.”


“What we have seen in the last couple of years is a jump in the submissions” to the agency, she said. And FDA does not see that as a temporary blip. “That that is probably going to continue” so FDA has to have “new ways to manage those and handle them.”


So it sounds like there is every reason for cheer in the industry as 2018 draws to a close. Though – not to sound like the Grinch or anything – the data don’t quite prove Woodcock’s point. At least not yet.

A Three-Year Rolling Grinch

During the FDA/CMS Summit Dec. 11, Office of New Drugs acting Chief of Staff Khushboo Sharma presented the agency’s annual update on the new drug review program at FDA, which offers a look back across the user fee era in the number of NME submissions and approvals each year.


And, while there is no doubt that the current period is much better than the decade of the 2000s, it is hard to see evidence that Moore’s law has taken hold for drug development when compared to the mid-1990s.


On the approval side, if you look at the last three years, FDA now tallies 120 NME approvals since 2016. That compares to 122 NME approvals in 1996-1998. Granted, FDA may well approve another handful of NMEs and set a new three-year high – but it is hard to use that data to argue that industry has dramatically increased productivity over 20 years.


Looking at submissions, FDA had a record-setting year in 2017, with 57 NME filings. As of Nov. 30, it has received 43 submissions in 2018 (the same amount it had as of November 30, 2017). Even before the year-end filing rush, the latest three years have already topped the 1995-1997 period for NME filings: 143 vs. 136. But if you extend to a fourth year, it is 179 filings (1995-1998) vs. 178 (2015-2018 YTD).


Clearly, if FDA ends up with 55-60 NME filings again in 2018, it will start to look like a significant increase – though it is still debatable if anyone in 1995 would have been happy to know that they would have to wait more than 20 years before the industry was able to top 50 NME filings in a single year.


Sharma’s data do show one area of dramatic growth in R&D activity, with a continued increase in the number of commercial INDS on file at FDA. As of Nov. 30, FDA counts 7,201 INDs – up from 7,020 a year ago, and way up from the 4,361 in 2004 (the earliest year included in the chart). Of course, that is hardly a measure of productivity – at least not yet. That depends on how many of those new IND filings actually make it through to FDA approval.


So there is definitely plenty of good news to celebrate in the FDA approval numbers as 2018 draws to a close. But maybe hold off on that really special bottle of champagne for a few more years.…