The Food and Drug Administration (FDA) has a high level of prestige in our society. Drug manufacturers celebrate the approval of a new drug, launching publicity campaigns to announce their new “FDA-approved” status. But what does it really mean for a drug to be FDA approved? Unfortunately, much less than you would expect. And in fact, much less than most physicians think. A 2016 Brigham & Women’s study surveyed physician perceptions of FDA approval. It turns out that…

  • 73% of physicians think – incorrectly – that the FDA only approves new drugs if they are at least as good as existing drugs
  • 70% of physicians think – incorrectly – that the FDA approves drugs based on clinically meaningful benefits

If we extrapolate this data, unfortunately it means that the vast majority of physicians are making decisions about drugs based on gross misperceptions of FDA approval.

So what does FDA approval mean? To gain approval, a drug has to show statistical significance on a primary outcome compared to placebo in one study.

In other words, drugs approved in the US don’t have to be better than existing drugs or provide a clinically-meaningful benefit.

This is a weak standard. It’s not a bad standard, but to decide whether or not to use a medication, we need more information. This is where comparative effectiveness research steps in and offers a solution. This field of study asks the valuable question, “How well does this treatment work compared to alternatives?” And the answers all come from facts – rigorous clinical trials that have been carefully vetted by scientists.

Is your drug formulary being managed with comparative effectiveness data? We have found that most formularies are managed instead by FDA-approval status and rebating, which we’ve shown is a weak standard and, in many cases, may lead to paying too much and getting too little.