Is FDA to Blame for Biomedical Industry's Slow Growth

2016-bl-proper-role-fda-21st-centuryGiven the global economic challenges today, it is understandable that the biomedical industry sees lack of funding as a key obstacle in growth. What is surprising is that the industry also sees the FDA and the current regulatory environment as a stumbling block.

Eight in 10 CEOs of biomedical companies who participated in a recent survey "agreed" or "strongly agreed" that the current FDA approval process has slowed the growth of their organizations. Eighty percent of the surveyed CEOs do not believe that the FDA has the best regulatory process in the world. Three-quarters believe that within five years, another country could conceivably recreate the ecosystem that has made the United States the leading biomedical region in the world. Survey results were released in January.

Eighty percent of the surveyed CEOs do not believe that the FDA has the best regulatory process in the world.

The California Healthcare Institute (CHI), BayBio, and PwC US conducted the survey in November 2011. It targeted about 100 companies that conduct business in California in the areas of biotechnology, pharmaceutical, medical devices, diagnostics, and medical equipment.1

The FDA's Center for Biologics Evaluation and Research (CBER) said it has not evaluated the survey and declined to comment on it. But the agency emphasized its proactive stance in "seeking to foster and encourage innovation, as well as to aggressively protect patient safety."

Rita Chappelle, CBER press officer, told GxP Lifeline: "To facilitate the regulatory approval process, CBER works with industry to implement novel approaches to clinical trial design and analysis. As part of these efforts CBER routinely meets with sponsors early on in the product development process, both before and during clinical study design. FDA staff encourages early and repeated interaction with sponsors to facilitate clinical studies, assist in study design, etc., in an effort to help sponsors gather data that will support product approval."

Chappelle explained that once a manufacturer submits a license application to FDA/CBER, the agency is under very strict timelines to complete its review and respond to the manufacturer in accordance with the Prescription Drug User Fee Act (PDUFA). In spite of the strict timelines, Chappelle said: "Since the inception of PDUFA, CBER has had only two original biologics license applications that did not meet the PDUFA timeline." PDUFA was enacted in 1992 and renewed in 1997, 2002, and 2007.

David L. Gollaher, president and CEO of California Healthcare Institute, said sound public policy and operational improvements at the FDA, along with responsible congressional oversight, will encourage industry innovation and job growth. "Working collaboratively with other stakeholders, Congress, and FDA, the biomedical industry can maintain the high standards of safety and effectiveness that address patients' needs, while improving our ability to attract investment and to grow in 2012 and beyond," Gollaher said in a press statement.

Among other things, the findings of the survey showed that:

  • Seventy-four percent of surveyed CEOs said their companies have had to delay a research or development project in the past year.
  • Lack of funding was the top reason for project delays cited by private-company CEOs and accounted for 40 percent of delays by both public and private companies.

  • Forty-four percent of the CEOs said they will look to licensing agreements and corporate partnerships as a source of finance in the next 12 months, while 30 percent said they will tap corporate venture capital as a finance source in the next 12 months.

In California alone, the biomedical industry generated about $114 billion in revenues in 2009, according to CHI. It employs 268,000 people in the state and supports another 738,000 people from related sectors.

The biomedical industry is undoubtedly important to the American economy. The survey results are equally important in showing the general public a glimpse of the challenges the industry is currently facing. We could say that the survey serves both as an appeal and a warning to policy makers. Let us hope that industry leaders and policy makers keep communication channels open to help ease those challenges.


  • 1. CHI represents 275 biotechnology, medical device, diagnostics, and pharmaceutical companies, and public and private academic biomedical research organizations. BayBio represents Northern California organizations engaged in, or supportive of, research, development, and commercialization of life science technologies. PwC™ Pharmaceutical, Medical Device and Life Sciences Group is dedicated to delivering effective solutions to the complex strategic, operational, and financial challenges facing life science companies.

Cindy Fazzi, a copywriter at MasterControl Inc., writes about the life sciences industry and other regulated environments. Her two decades of experience as a news reporter, writer, and editor includes working for the Associated Press in Ohio and New York. She has a master's degree in journalism from Ohio State University.