Randomized controlled trials are the key to medical innovation, but they have become substantially more expensive in recent decades. A series of regulatory changes could bring RCT costs down and deliver more innovation.

RCT prices have ballooned in recent years. According to one estimate, for trials conducted between 2015 and 2017, the median cost was $41,413 per patient. And in some trials, the figure gets significantly higher. According to George Yancopoulos, the cofounder and chief scientific officer of biotech firm Regeneron, per-patient costs can now reach $500,000—a far cry from the typical $10,000 per patient when he first started in the field. The structural reasons include longer trial durations and a larger number of subjects, driven by a growing emphasis on chronic disease and a crowded field of existing drugs.

Pharmaceutical companies have responded by looking to less onerous forms of approval or by outsourcing trials to countries where medical care is cheaper. But these approaches carry their own downsides. Other countries might have standards of care that differ from ours. And while Accelerated Approval, an easier pathway, has led to some successes, it also has flaws. A 2009 Government Accountability Office report and Vinay Prasad’s 2020 book Malignant both point to a lack of required confirmatory studies being carried out after initial approval.

Yet cheaper but rigorous trials are possible. The U.K. Recovery Trial (which, for a cost of about $500 per patient, evaluated ten therapeutics for Covid-19) and the COVID-OUT group’s decentralized Covid-19 trials stand as examples. The proper response to this problem is to address RCT costs directly, through targeted regulatory reform. In my recent issue brief for the Manhattan Institute, I propose six changes.

First, deregulate clinical trial advertising. The FDA’s rules remain stuck in the 1990s. In a world of glitzy social-media advertisements, clinical trial recruitment is hamstrung by rules on font size, bold font, and a lack of emphasis on trial incentives. Removing such rules while continuing to require truthful content should not be controversial.

Second, fix tax disincentives. Research participants can’t file for a tax exemption for participation in clinical trials, but pharmaceutical companies’ research costs are tax-deductible. Like Olympians and volunteer firefighters, both of whom receive certain kinds of compensation tax-free, research-participant payment should also be tax-deductible, in recognition of the huge benefits that accrue to society from this work.

Third, extend existing tax advantages. “Orphan disease” trial participants currently enjoy exemptions of up to $2,000 from trial participation from Supplemental Security Income and Medicaid annual limits. Extending this proviso to participants in all trials would increase the socioeconomic diversity of trial participants by removing the disincentive some may face to join the trials.

Fourth, require more Institutional Review Board (IRB) transparency. IRBs have a reputation for both excess caution and tremendous variation across institutions. Because American IRBs do not publish their meeting minutes or decisions publicly, studying them empirically is hard. Greater IRB transparency (with redactions or delays for commercially important information) would follow New Zealand’s Ethics Application Repository (TEAR) as a model. The result would be greater scrutiny of IRBs; researchers at institutions with excessively cautious IRBs could compare them with others.

Fifth, walk back misguided FDA and congressional diversity mandates. Since the late 1990s, the FDA has encouraged inclusion of more minority participants in clinical trials, assuming that some populations would, for either genetic or environmental reasons, respond differently to medication. But the drug BiDil, which showed efficacy only in blacks, is the lone drug approved for a specific ethnic group. In 2020, in a prelude to what was to come, NIH director Francis Collins unilaterally delayed participant accrual in Moderna’s Covid-19 vaccine trial by three weeks in order to increase minority participation, as Peter Loftus reported in The Messenger.

Like many institutions that have quietly bowed to radical identity politics, the FDA moved even further in this direction in 2022. The agency issued guidance (which, though non-binding, is virtually law) that expanded diversity requirements and requires “cultural competency and proficiency training for clinical investigators and research staff.” In 2022, Congress went further still and required the FDA to collect “diversity action plans” for clinical trials, while imposing new reporting requirements.

These efforts will slow trials and raise costs, and no high-quality evidence suggests that they will help. Congress should rescind these changes and instruct the FDA to roll back its diversity guidance to the 2020 standard. Congress should also instruct the FDA to collect estimates from sponsors on the monetary costs of increased diversity in trials. Lawmakers should also develop estimates of how beneficial more diversity could be, thereby putting any future attempts at mandated diversity on firmer evidential footing.

Sixth, affirm the FDA’s commitment to twenty-first-century methods of trial monitoring. A report to HHS in 2014 highlighted industry use of “source data verification” (SDV) as an important driver of trial costs, a finding echoed in a 2022 report as well. The origins of SDV date to 1998, when FDA issued guidance that effectively required in-person double-checking of every bit of data submitted by a given site to the sponsor of the trial. In 2013, the FDA followed the lead of European regulatory agencies and instead endorsed “risk-based monitoring,” which calls for centralized remote monitoring that focuses on data anomalies for more in-depth investigation.

Unfortunately, a recent industry survey showed that, as of 2021, most of these principles had not yet been widely implemented. Conversations with regulators and clinical-research organization employees suggest that an important reason for the slow adoption is uncertainty that FDA reviewers (who enjoy substantial autonomy) endorse the newer approach. To signal their commitment to these new methods, the FDA should issue more guidance, educate reviewers on risk-based monitoring, and set up a new recognition program for employees who demonstrate excellence in risk-based monitoring, akin to the already-existing “Scientific Achievement Awards.”

These sensible, incremental changes would remove unnecessary barriers to rigorous but affordable trials—and result in a rare mutual gain for patients, health-care system resources, and pharmaceutical companies.

Photo by Michael Ciaglo/Getty Images


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