Subscribe
Share
Share
Embed
Each week, Health Affairs' Rob Lott brings you in-depth conversations with leading researchers and influencers shaping the big ideas in health policy and the health care industry.
A Health Podyssey goes beyond the pages of the health policy journal Health Affairs to tell stories behind the research and share policy implications. Learn how academics and economists frame their research questions and journey to the intersection of health, health care, and policy. Health policy nerds rejoice! This podcast is for you.
Hello, and welcome to A Health Odyssey. I'm your host, Rob Lott. It's not always best to be first. When it comes to drug development, for example, there's a lot more risk associated with developing so called first in class drugs compared to simply making small tweaks over the same kind of old drug. After all, we just don't know as much about how first in class drugs work in practice and over time.
Rob Lott:We can't predict all the surprises that might arise as they're tested and marketed. These disadvantages create a disincentive for first in class drug development. Why try something new and risky if you'd have more certainty by taking only small, more incremental steps? So to incentivize more innovative drug development, policy makers and regulators have tried to smooth the way forward for first in class drug development. They have done this by applying significant regulatory flexibility to first in class drug applications, often shrinking the review time or accepting less exacting types of clinical trials for approval.
Rob Lott:This approach makes it easier to bring a drug to market, but there's a trade off in the form of an entirely new kind of uncertainty. That is, we have less information about a drug that's benefited from this flexibility and therefore may be less confident about its true real world effectiveness. Trade offs such as these are inevitable, but what we don't really know is whether our approach to these trade offs is uniquely American. Do regulators in other countries make the same calculation, or are we taking on greater risk and allowing for less certainty in The United States? That's the topic of today's health policy.
Rob Lott:I'm here with doctor Jihae Han, a research specialist with the program on regulation, therapeutics, and law at Brigham and Women's Hospital. Along with her coauthor, doctor Erin Kesselheim, doctor Han has a new article in the March 2025 issue of Health Affairs. Its title is also its main finding, quote, first in class drugs experienced different regulatory treatment in The US and Europe. I am really very excited to learn more about it here today. Doctor Jie Han, welcome to A Health Odyssey.
Jihye Han:Yeah. Thank you for having me. It's great to be here.
Rob Lott:So let's start with just a a little quick background. What do we mean when we use the term first in class drugs, and why is it important to study them as a different category from drugs in general?
Jihye Han:Yeah. Thanks for asking that question. So first in class drugs are what they sound like. They are the first of their kind. They introduce a new mechanism of action that wasn't previously used in existing treatments.
Jihye Han:So at the time of approval, they represent something fundamentally different from existing treatments, although they may target diseases that already have FDA approved treatment
Rob Lott:options that use
Jihye Han:a different mechanism of action. Approved treatment options that use a different mechanism of action. So in other words, they work in a new way, but that doesn't always mean that they are the first treatment for a disease. So back in 2013, FDA researchers published a paper in health affairs categorizing new drugs based on their level of novelty. They defined the first in class drugs as those targeting a new pathway.
Jihye Han:Other new drugs were classified as advancing class, meaning that they used a similar mechanism of action as an existing drug, but improved safety or efficacy in some way or addition to class, which provided another option without necessarily adding advantages over existing treatments. So in this way, first in class drugs are often considered the most innovative category of new drugs. But one interesting thing about first in class drugs is that they also come with a lot of uncertainty. Since these drugs work via new mechanisms, there's not the same prior clinical experience to provide us with a hint about how they will perform in routine clinical use. So I think that's why studying first in class drugs separately is important.
Jihye Han:Firstly, from a clinical perspective, it is important for physicians and patients to understand the quality of evidence behind these drugs so they can make informed treatment decisions. Secondly, from a regulatory and policy standpoint, studying first in class drugs helps us assess the extent of regulatory flexibility applied to drugs that are considered highly innovative but have important uncertainties about their safety and efficacy.
Rob Lott:Okay. So you used the term regulatory flexibility. I mentioned that in the introduction as well. Just trying to wrap my head around that idea. Can you provide some examples of what it looks like when the FDA provides, quote, regulatory flexibility?
Jihye Han:Yeah. So FDA's regulatory initiatives target to promote pharmaceutical innovation. And one example is the expansion of expedited programs to facilitate the introduction of drugs addressing unmet medical needs. These programs offer different types of flexibility, including shortening the FDA's official review date timeline, allowing approvals based on surrogate measures instead of clinical outcomes and permitting rolling submissions of data. Because first in class drugs introduce new mechanisms of action, they are very likely to fall into one of these expedited pathways, especially when they trace serious conditions with no existing treatment options.
Jihye Han:Our study actually, showed that eighty one percent of first in class drugs approved from 2013 to 2023 were designated with at least one of the four expedited programs in the FDA. And another way to look at regulatory flexibility for first in class drugs is clinical trial design. Since 1998, when FDA published a guidance on evidence needed to establish effectiveness, the preference has been for two pivotal trials to reach the substantial evidence statutory approval standard. But first in class drugs often entered America with only one pivotal trial, and that trial may be a phase two trial rather than phase three or lack randomization or control groups. Even though this kind of flexibility helps bring novel treatment to patient faster, it also increases uncertainty about their safety and effectiveness.
Rob Lott:Okay. So give me a sense. You you said often first in class drugs will come to market with only, one trial, for example, instead of two, or they might use a surrogate, marker instead of a, like, a clinical endpoint. What are the reasons that a first in class drug might not be able to kinda do two trials or do a clinical, endpoint? Why do we even have to give them that additional flexibility?
Jihye Han:Yeah. It's a it's a great question. So, clinical outcomes as opposed to the surrogate measures directly measure a treatment's benefits such as whether patients live longer, experience symptom relief, or see improvements in their condition. In contrast, surrogate matters or surrogate endpoints like blood tests or radiological evidence are used as a substitute to predict clinical benefits. In fact, some surrogate markers have undergone extensive validation and are widely accepted as meaningful indicators of clinical benefit, like blood pressure for cardiovascular outcomes.
Jihye Han:There are cases when clinical outcomes take too long to study or where it'll be unethical to require them in trials. That's when surrogate endpoints can be useful and also for the first in class drugs. The FDA's accelerated approval pathway allows drugs to be approved based on surrogate markers only reasonably likely to predict clinical benefit with the expectation that post marketing, confirmatory trials will later verify their actual impact on patient outcomes. But surrogate measures have received increasing attention because many drugs approved through accelerated opoprolol has have delayed or, failed to confirm clinical benefits in post marketing trials.
Rob Lott:There's also some flexibility around things like blinding and randomization too. Is that right?
Jihye Han:Yeah. So for blinding and randomization, these are also the key tools in clinical trial designed to reduce bias, but a growing number of drugs are approved by the FDA based on single arm designs or historical controls, which inherently do not allow for blinding and increase the risk of bias. As to first in class drugs, being pharmacologically innovative doesn't necessarily mean a drug is a true medical innovation. A drug is clinically innovative only if it leads to meaningful improvements in patient outcomes, not just because it has the potential to do so. That's why if a drug is approved based on surrogate endpoints and limited eventuaries per due to clinical design flexibilities, tracking its clinical performance is important, ensuring that the regulatory flexibility doesn't come at the cost of patient safety and effectiveness.
Rob Lott:Okay. So let's dig into your paper. You, basically tried to assess how widespread the the regulatory flexibility is, and you compared the approach in The United States to Europe. What did you learn?
Jihye Han:So we looked at three key aspects, refrigeration, use of expedited regulatory programs, and the key characteristics of pivotal efficacy trials for the first in class drugs approved by the FDA during the last decade, and then we compared that, these pictures to the EMA. For the refrigeration, we used the time it took for, the drugs to be reviewed at each agencies. We also compared the different review times by expedited program use. And for the trial characteristics, we reviewed how many studies supported approval like study size and trial phase, presence of comparators, blinding, and endpoints. The first in class drugs are very likely to go through expedited programs at the FDA.
Jihye Han:We found eighty one percent used at least one program compared to only thirty percent in the EMA. In PIRG, due to this, expedited program use, FDA review times were shorter, although the differences were not very large. It was eight point one three months in the FDA versus ten months in the EMA for the common drugs in, in the two agencies. And in terms of the clinical trial characteristics, nearly half were based on surrogate measures and around thirty percent were approved without blinding and control. And a quarter had no phase three trial data when it is approved.
Jihye Han:And for cancer drugs, about ninety percent were based on surrogate measures and open label trials.
Rob Lott:Okay. Pretty interesting results there. I'd like to hear more about, some of the details, which we'll talk about when we return after this break. And we're back. I'm here with doctor Jieh Han, and we're talking about her analysis of first in class drugs and their regulatory flexibility, they experienced in The United States compared to Europe.
Rob Lott:In particular, I understand you found that, FDA review durations varied by therapeutic area. For example, cancer drugs had shorter review durations compared to those for musculoskeletal conditions. How do we explain that variation? Is there a greater sense of urgency around cancer drugs or perhaps a greater incentive for drug developers to find ways to speed up the process, or is there some other explanation altogether?
Jihye Han:Yeah, it is an interesting point. So we found that, the FDA's review time ranged from seven point seven months for cancer drugs to fourteen point five months for most cholesterol drugs. And we can only speculate the underlying reasons, but several factors may contribute to this variation across different therapeutic areas. Firstly, I think there is a heightened sense of urgency surrounding cancer treatments due to the severe and life threatening nature of the disease. This kind of urgency led to federal initiatives designed, to accelerate the approval process of oncology drugs.
Jihye Han:For example, the, the twenty first Century Cures Act established the FDA's Oncology Center for Excellence, which introduced the real time oncology review program to expedite the review of new oncology drug applications. It is also possible that, there is a strong financial incentive for manufacturers to find ways to accelerate the approval process for oncology drugs because of high price tag of, such drugs. Reflecting this, cancer drugs made up the largest proportion of first in class drug approvals in our cohort. And furthermore, in 2024, oncology was top ranked in terms of clinical trials towards according to the IQBA report. And, historically, studies looking at overall new drugs have indicated that cancer drugs undergo faster review times compared to any other therapeutic areas.
Jihye Han:And FDA has outpaced foreign regulatory agencies in reviewing cancer drugs more than any other drug categories. While our study didn't specifically, break down expedited program use by therapeutic area, we also found that 44 out of 46 cancer drugs received priority review at the FDA, which shortens the FDA official refrigeration from ten months to six months and which likely played a role in their shorter repeat times. So collectively, I think these factors have made cancer drugs one of the fastest moving therapeutic areas in the FDA approvals.
Rob Lott:Okay. So what do these findings, tell us about the different, expedited regulatory programs? Are they achieving the goals in your eyes that we had set out for them when they were created?
Jihye Han:So FDA's expedited program includes priority review, accelerated approval, fast track, and breakthrough therapy designation. And some of, some studies have found that while these programs have sped up the overall approval process, as we also observed in our study on first in class drugs, they haven't necessarily increased the number of new drugs approvals or significantly reduced total development times. And, at the same time, the expansion of expedited programs has reduced the amount of clinical evidence available at the approval. However, the FDA's communication about these evidence limitations remains, still very limited. Currently, only accelerated approval drugs include this kind of information in their labelling.
Jihye Han:So, certainly, there is a need for further research and potential policy reforms to ensure these pathways balance speed with, the robust evidence generation.
Rob Lott:Gotcha. So you're saying that, basically, my doctor could prescribe a a drug for me, and I I might not know whether or not it kinda reached the market without as much evidence as, as a typically approved drug. Is that a fair way to describe it?
Jihye Han:Yeah. Yeah. So FDA publishes, annual report of new drug approvals, and they disclose all of the expected program use for, each drug. However, it's not always easy for patients and physicians to know, to learn about those information based on the model of each drug.
Rob Lott:Got it. Okay. Can you envision any changes to the pathways that might remove some of the uncertainty they create, or is that just an inherent piece of the of the the the bargain, if you will?
Jihye Han:Yeah. As I just mentioned, there are, like, concerns regarding the reduced amount of clinical evidence at the time of approval. So to address these concerns, I think postmakers could improve transparency by clearly indicating when a drug was approved through, one of the expedited pathways and what uncertainties could come with it. This is important for physicians and the patients like us who make their treatment decisions in the face of these uncertain Another area for potential reform that I could think of is, for the robust clinical evidence, in post marketing confirmatory trials, particularly for accelerated approval drugs. One study found that fewer than half of cancer drugs approved through this pathway later confirmed benefits and clinical outcomes, and many trials delayed or failing to, demonstrate expected benefits.
Jihye Han:So strengthening these requirements could better balance regulatory incentives for innovative drugs with the need to ensure safe and effective drug use.
Rob Lott:So, new drugs are expensive, typically, and I'm wondering what we know about how payers are responding, to the combination of high prices and high uncertainty created by the greater regulatory flexibility. And are there policy solutions that maybe could be applied on the payment side to potentially improve both access to these drugs and maybe the certainty around their effectiveness?
Jihye Han:The public payers like Medicare in The US often have to cover these drugs even when the evidence is uncertain. This can lead to a high spending with unknown benefits. In contrast, other countries use health technology assessments to make reimbursement decisions after approval. A study found that around twenty six percent of first in class drugs approved by the FDA received negative reimbursement decisions in other high income countries because of their uncertain benefits or lack of cost effectiveness. On the other hand, private insurers in The US have more discretion and may choose not to cover, high priced drugs with uncertain benefits.
Jihye Han:They often implement coverage restrictions and utilization, management strategies like step therapy, prior authorization, or formulary exclusions for new drugs due to concerns about high cost and limited evidence of efficacy. So as a prospective policy option, payment models that tie drug prices to clinical uncertainty and the level of supporting evidence could help mitigate financial risks for public payers in The US. For example, this could include performance based payment models or mandated higher rebates for drugs approved without confirmatory evidence until such evidence is secured.
Rob Lott:Got it. Okay. Well, before we wrap up, I did wanna ask, my understanding is that you, used to work at a drug company's, regulatory affairs office in Seoul, South Korea. Yeah. Then you then you came to The United States, where you've really zeroed in on The US regulatory process.
Rob Lott:And I'd love to hear a little bit about how The US system in your experience, has maybe surprised you or presented an a new picture of, regulate regulation compared to your experience in South Korea and, and looking at other nations around the globe?
Jihye Han:Yeah. Thanks for asking this question. So one significant distinction in The US system compared to the any other system or the word is the disconnection between drug pricing and the regulation in The US. So in other countries, reimbursement decisions assess whether a drug offers sufficient value to justify its price and whether the health system can afford it with limited resources. So both approval and reimbursement decision are the critical steps in drug access.
Jihye Han:Studies have, consistently shown that the majority of new drugs, including first in class drugs, are first launched in The US before any other country. This makes The US the first to face uncertainty in terms of safety and effectiveness. Even so, in The US, clinical uncertainty increased by regulatory flexibilities is combined with and conveyed as financial risks to payers and patients due to, like, an effective regulation on drug prices. So I think US Policymakers may want to manage policies that incentivize innovation by directing resources only to drugs that truly address this needs. And focusing on, the pharmaceutical policy in US has influenced my perspective on health system in various ways.
Jihye Han:However, my transition from industry to academia has more significantly changed the way I look at regulatory incentives and the value of new drugs as they are rather than shifting my view on different systems. I've become more focused on, public health and resource allocation perspective and its, broader societal impact rather than just the value of drug itself. And regarding other systems, different challenges also arise, such as submission or approval delays compared to The US due to the lower incentives from expected revenues and limited coverage of new drugs inherent in, the social insurance or taxpayer funded systems. Therefore, a careful but very different balance in each system is needed between increasing incentives for drug developers who will bring innovation and ensuring safe, equitable, and also affordable access to medicines, which needs further study.
Rob Lott:Wow. What a great, point to end on, doctor, Jie Han. Thank you so much for taking the time to chat with us today.
Jihye Han:Thank you so much for having me and asking great questions. It was my pleasure to be here. Thank you.
Rob Lott:And to our listeners, thanks for tuning in. If you enjoyed it, please tell a friend, smash that subscribe button, and tune in next week. Thanks for listening. If you enjoyed today's episode, I hope you'll tell a friend about a health policy.