New Medicines for Serious Diseases: The Case of the FDA’s Breakthrough Designation

48 Pages Posted: 12 Feb 2021

See all articles by Manuel Hermosilla

Manuel Hermosilla

Johns Hopkins University - Carey Business School

Date Written: November 16, 2020

Abstract

In the late 2000s, early-stage clinical trials for personalized drugs unveiled large beneficial treatment effects. These findings created an unexpected regulatory challenge: by removing genuine clinical uncertainty on the best treatment alternative, they made randomized controlled Phase 3 trials ethically contestable. This paper studies how the program enacted in response to this challenge — the FDA's Breakthrough Therapy designation---has shaped pharmaceutical R&D. Our results suggest that the program's 2012 creation ignited a large amount of new drug R&D targeting serious and life-threatening conditions. According to the program's history, these impacts may not have been fully premeditated. Measured by medium-term anticipated drug approvals, these indirect program impacts could be as large direct ones.

Note:
Funding Statement: There is no funding to report.

Declaration of Interests: The author declares no competing interests.

Keywords: Induced Innovation, Pharmaceuticals, Health Policy, FDA, Technical Change

JEL Classification: I1, I18, O3.

Suggested Citation

Hermosilla, Manuel, New Medicines for Serious Diseases: The Case of the FDA’s Breakthrough Designation (November 16, 2020). Available at SSRN: https://ssrn.com/abstract=3731669 or http://dx.doi.org/10.2139/ssrn.3731669

Manuel Hermosilla (Contact Author)

Johns Hopkins University - Carey Business School ( email )

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Baltimore, MD 21202
United States

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