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The FDA's Drug Approval Process
The Genesis of Drug Compounds
Basic science provides the foundation for discovery of most new drug compounds. Scientists study the human body in both its normal and abnormal states. They try to understand the disease processes, which generally take place at the cellular and/or molecular levels and can be highly complex. Insights gained through these studies often lead to clues as to possible therapies.
New drug compounds emanate from a wide variety of sources. Many pharmaceutical companies have massive R&D budgets. Some of this spending is directed at basic research and some at specific diseases or medical conditions. The range of talent employed by these companies is very broad and often includes organic chemists, physiologists, biochemists, molecular biologists, toxicologists, pharmacologists and computer scientists.
Researchers at university and government laboratories also pursue promising leads. Many of these scientists, however, are not commercially oriented and often have only shoestring budgets. Development and commercialization of discoveries from these sources often takes place under licensing arrangements with established commercial entities.
Animal Testing
Promising laboratory discoveries are generally tested on rabbits, rats and other animals to gather data regarding safety and efficacy. The FDA does not usually have direct involvement in these tests, but researchers are usually responsive to FDA guidelines on data that it expects in requests to conduct human clinical trials.
Animal studies focus on the rate and amount of the drug’s absorption into the blood, the action of the body in response to the drug, the compounds produced as a result of the drug’s breakdown, and the speed at which drug breakdown and excretion occur. In response to results from these studies, the drugs are modified to enhance desirable effects. Most tests involve two or more species, since responses often vary from species to species.
Only a miniscule percentage of drug compounds tested on animals actually continue on to human clinical trials. Negative results often stem from poor drug absorption rates, unacceptable toxicity of the drug or its breakdown compounds, and an absence of efficacy in animals.
Human Clinical Trials
The FDA must approve all investigational new drug ("IND") applications. Sponsors of an IND submit their laboratory and animal studies and proposed plans for human studies. The data and proposals are scrutinized by both the FDA and a local institutional review board. On-going trials are sometimes also reviewed by an independent Data and Safety Monitoring Board.
The review boards are set up to oversee the human clinical trials. Boards consist of at least five people, including at least one non-scientist such as a lawyer or member of the clergy. One or more members must be unaffiliated with the research institution. One of the boards’ principal tasks is to protect the rights and welfare of the research participants, including minimizing risks to subjects, ensuring that each subject has submitted an informed consent, and safeguarding the process of selecting subjects.
The FDA permits institutional review boards to use an expedited review process for certain projects that are deemed to carry little or no risk. Such reviews can be conducted by the chairman or senior members alone. Expedited reviews may also be used in making minor changes to existing projects.
Phase 1 Clinical Trials
Phase 1 clinical trials are designed to test the safety of new drugs. The trials generally test 20-100 patients and last for several months. Of all drugs for which IND applications are submitted to the FDA, about 70% will successfully complete Phase 1 trials and go on to Phase 2.
Phase 2 Clinical Trials
Phase 2 clinical trials are designed primarily to test the dosage and effectiveness of new drugs. The number of patients might be as high as several hundred, and the trials usually last several months to two years. Of all drugs for which IND applications are submitted to the FDA, about 33% will complete Phase 2 trials and continue on to Phase 3.
Phase 3 Clinical Trials
Phase 3 trials are designed to confirm and fine-tune results of Phase 1 and 2 clinical trials. The number of patients can range from several hundred to several thousand, and the tests can last from one to four years. Of all drugs for which IND applications are submitted to the FDA, only about 25% to30% will successfully complete Phase 3 trials.
New Drug Applications
Once a sponsor has successfully completed an IND’s clinical trials, it prepares a New Drug Application ("NDA") to request the FDA’s approval for the product to enter the marketplace. The documentation included in the NDA should include all of the information relevant to the IND, including results of laboratory, animal and clinical studies, as well as information regarding the product’s manufacturing, packaging and quality controls.
The FDA categorizes each new drug as either standard or priority. Standard drugs are those that appear to offer little or no improvement in benefit over drugs already on the market, while priority drugs are those that appear to offer significant new benefits. An accelerated approval process is available for drugs that promise significant benefit over existing therapy for life-threatening illnesses. In measuring such benefit, the FDA is willing to take into consideration a drug’s effect on a "surrogate endpoint", i.e. a measurement that is considered likely to predict therapeutic benefit. For example, surrogate endpoints in heart disease include high blood pressure and elevated serum cholesterol levels.
The FDA thoroughly evaluates each of the NDAs. The process includes on-site inspections of the investigators who did the work. The FDA’s evaluation often requires that the sponsor make modifications to the application or gather additional data. If the FDA finds significant problems with an application, the sponsor is permitted to withdraw the IND, file an amendment to the application or request a hearing to discuss the situation.
During the past several years, the FDA’s median time for an NDA review has been approximately two years. Priority drugs generally take far less time for review than standard drugs. Of all drugs for which IND applications are submitted to the FDA, only about 20% are ultimately approved for marketing.
Treatment INDs
The FDA permits very seriously ill patients to be treated with INDs that have met certain criteria relating to safety and potential usefulness. Sponsors of these drugs, in a last-ditch attempt to help seriously ill patients, are permitted to provide Treatment INDs to doctors not involved in controlled clinical trials. The FDA’s approval of Treatment INDs is subject to the sponsor’s keeping the drug moving forward through the traditional approval pipeline.
Orphan Drugs
An orphan drug is defined as one that is used to treat diseases or conditions affecting less than 200,000 persons in the U.S. There are approximately 5,000 such diseases or conditions, and together they affect an estimated 20 million persons in the U.S. Nearly half of the orphan diseases afflict 25,000 or fewer people, and many have 100 or fewer afflicted persons.
Prior to the Orphan Drug Act of 1983, such small patient populations were limiting sponsors’ potential profits and therefore their interest in drugs for these conditions. The Act offers research groups significant financial incentives to develop orphan products. These incentives include a seven-year guarantee of marketing exclusivity against identical products, the availability of clinical research grants, protocol assistance and tax credits. In addition, the FDA typically approves orphan products much more quickly than other drugs.
---------------
Note: The FDA's own extensive Web site was an important source of information for this article.
The Research Works, LLC
Basic science provides the foundation for discovery of most new drug compounds. Scientists study the human body in both its normal and abnormal states. They try to understand the disease processes, which generally take place at the cellular and/or molecular levels and can be highly complex. Insights gained through these studies often lead to clues as to possible therapies.
New drug compounds emanate from a wide variety of sources. Many pharmaceutical companies have massive R&D budgets. Some of this spending is directed at basic research and some at specific diseases or medical conditions. The range of talent employed by these companies is very broad and often includes organic chemists, physiologists, biochemists, molecular biologists, toxicologists, pharmacologists and computer scientists.
Researchers at university and government laboratories also pursue promising leads. Many of these scientists, however, are not commercially oriented and often have only shoestring budgets. Development and commercialization of discoveries from these sources often takes place under licensing arrangements with established commercial entities.
Animal Testing
Promising laboratory discoveries are generally tested on rabbits, rats and other animals to gather data regarding safety and efficacy. The FDA does not usually have direct involvement in these tests, but researchers are usually responsive to FDA guidelines on data that it expects in requests to conduct human clinical trials.
Animal studies focus on the rate and amount of the drug’s absorption into the blood, the action of the body in response to the drug, the compounds produced as a result of the drug’s breakdown, and the speed at which drug breakdown and excretion occur. In response to results from these studies, the drugs are modified to enhance desirable effects. Most tests involve two or more species, since responses often vary from species to species.
Only a miniscule percentage of drug compounds tested on animals actually continue on to human clinical trials. Negative results often stem from poor drug absorption rates, unacceptable toxicity of the drug or its breakdown compounds, and an absence of efficacy in animals.
Human Clinical Trials
The FDA must approve all investigational new drug ("IND") applications. Sponsors of an IND submit their laboratory and animal studies and proposed plans for human studies. The data and proposals are scrutinized by both the FDA and a local institutional review board. On-going trials are sometimes also reviewed by an independent Data and Safety Monitoring Board.
The review boards are set up to oversee the human clinical trials. Boards consist of at least five people, including at least one non-scientist such as a lawyer or member of the clergy. One or more members must be unaffiliated with the research institution. One of the boards’ principal tasks is to protect the rights and welfare of the research participants, including minimizing risks to subjects, ensuring that each subject has submitted an informed consent, and safeguarding the process of selecting subjects.
The FDA permits institutional review boards to use an expedited review process for certain projects that are deemed to carry little or no risk. Such reviews can be conducted by the chairman or senior members alone. Expedited reviews may also be used in making minor changes to existing projects.
Phase 1 Clinical Trials
Phase 1 clinical trials are designed to test the safety of new drugs. The trials generally test 20-100 patients and last for several months. Of all drugs for which IND applications are submitted to the FDA, about 70% will successfully complete Phase 1 trials and go on to Phase 2.
Phase 2 Clinical Trials
Phase 2 clinical trials are designed primarily to test the dosage and effectiveness of new drugs. The number of patients might be as high as several hundred, and the trials usually last several months to two years. Of all drugs for which IND applications are submitted to the FDA, about 33% will complete Phase 2 trials and continue on to Phase 3.
Phase 3 Clinical Trials
Phase 3 trials are designed to confirm and fine-tune results of Phase 1 and 2 clinical trials. The number of patients can range from several hundred to several thousand, and the tests can last from one to four years. Of all drugs for which IND applications are submitted to the FDA, only about 25% to30% will successfully complete Phase 3 trials.
New Drug Applications
Once a sponsor has successfully completed an IND’s clinical trials, it prepares a New Drug Application ("NDA") to request the FDA’s approval for the product to enter the marketplace. The documentation included in the NDA should include all of the information relevant to the IND, including results of laboratory, animal and clinical studies, as well as information regarding the product’s manufacturing, packaging and quality controls.
The FDA categorizes each new drug as either standard or priority. Standard drugs are those that appear to offer little or no improvement in benefit over drugs already on the market, while priority drugs are those that appear to offer significant new benefits. An accelerated approval process is available for drugs that promise significant benefit over existing therapy for life-threatening illnesses. In measuring such benefit, the FDA is willing to take into consideration a drug’s effect on a "surrogate endpoint", i.e. a measurement that is considered likely to predict therapeutic benefit. For example, surrogate endpoints in heart disease include high blood pressure and elevated serum cholesterol levels.
The FDA thoroughly evaluates each of the NDAs. The process includes on-site inspections of the investigators who did the work. The FDA’s evaluation often requires that the sponsor make modifications to the application or gather additional data. If the FDA finds significant problems with an application, the sponsor is permitted to withdraw the IND, file an amendment to the application or request a hearing to discuss the situation.
During the past several years, the FDA’s median time for an NDA review has been approximately two years. Priority drugs generally take far less time for review than standard drugs. Of all drugs for which IND applications are submitted to the FDA, only about 20% are ultimately approved for marketing.
Treatment INDs
The FDA permits very seriously ill patients to be treated with INDs that have met certain criteria relating to safety and potential usefulness. Sponsors of these drugs, in a last-ditch attempt to help seriously ill patients, are permitted to provide Treatment INDs to doctors not involved in controlled clinical trials. The FDA’s approval of Treatment INDs is subject to the sponsor’s keeping the drug moving forward through the traditional approval pipeline.
Orphan Drugs
An orphan drug is defined as one that is used to treat diseases or conditions affecting less than 200,000 persons in the U.S. There are approximately 5,000 such diseases or conditions, and together they affect an estimated 20 million persons in the U.S. Nearly half of the orphan diseases afflict 25,000 or fewer people, and many have 100 or fewer afflicted persons.
Prior to the Orphan Drug Act of 1983, such small patient populations were limiting sponsors’ potential profits and therefore their interest in drugs for these conditions. The Act offers research groups significant financial incentives to develop orphan products. These incentives include a seven-year guarantee of marketing exclusivity against identical products, the availability of clinical research grants, protocol assistance and tax credits. In addition, the FDA typically approves orphan products much more quickly than other drugs.
---------------
Note: The FDA's own extensive Web site was an important source of information for this article.
The Research Works, LLC
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| Current Covered Companies |
Advanced Cell Technology (OTCBB: ACTC)Force Protection, Inc. (Nasdaq: FRPT) CLOSEDGeoPharma, Inc. (Nasdaq: GORX)Quantum Technologies (Nasdaq:QTWW)uWink, Inc. (OTCBB: UWKI)| Current Targets and Stops |
| Symbol | Picked | Target Price | Stop Loss |
 ACTC |
$0.17 | $0.50 | - |
| FRPT |
$2.00 | $28.00 | Closed Position 05/11/07 |
| GORX |
$2.75 | $5.50 | $2.25 |
| QTWW |
$0.57 | $8.75 | $1.50 |
| UWKI |
$1.25 | $4.50 | $0.50 |
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The FDA's Drug Approval Process
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IRS Publication Qualified Small Business Stock
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