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FDA and Innovation: Addressing the Public Health Challenges of the 21st Century

Remarks as Prepared for Delivery of Margaret A. Hamburg, M.D.
Commissioner of Food and Drugs
The Cleveland Club
July 15, 2011

Thank you for that kind introduction, and thank you for the opportunity to be here this afternoon. This is a very special forum that has been promoting relevant and spirited dialogue since 1912, and I hope it will continue to do so for many years to come.

It is an honor to be here at the Club and wonderful to be in Cleveland, a city with such a rich history in medicine and the sciences.
        
The City of Cleveland and the State of Ohio are at the forefront of health care, biomedical research and the development of new biomedical-related companies. We are just minutes away from Cleveland Clinic—consistently ranked as one of the top hospitals in the nation and a source of cutting edge research and innovation—and just a short drive away from the University Hospital of Cleveland, a leader in cancer research. And, of course, the renowned medical training and research programs at Case Western University, as well.

Ohio’s commitment to biomedical research and development has not gone unnoticed. Investments in the biomedical enterprise across the state exceeded $2.4 billion in 2009, with Ohio institutions and companies attracting more than $700 million in funds from the National Institutes of Health alone.

This is impressive and important…important for patients and their families, important for improving health care and important for the economy of this State and our nation. And FDA is an important partner in these efforts.

So let me tell you a little bit about my agency and why it matters…and why we, as a nation, need a strong, modern Food and Drug Administration that makes science-based, data-driven decisions on behalf of the public health and that is equipped with the knowledge and resources it needs to serve the American people and promote innovation in the 21st century.

The breadth and scope of the FDA is extraordinary. When I became Commissioner a little over  two years ago, I have to confess that I really did not fully understand the magnitude of the challenge. Consider that FDA is responsible for ensuring the safety, efficacy, and security of drugs, vaccines and biological products, medical devices, and certain products that emit radiation—as well as oversight of the safety of our nation’s food supply, cosmetics, dietary supplements, animal drugs and feed, and most recently, tobacco products, as well. In other words, our agency is entrusted with promoting and protecting the health and well-being of anyone who eats, takes an over-the-counter painkiller or a prescription drug or uses a medical device like a pacemaker or has an x-ray.

Products we regulate make up somewhere between 20 and 25 percent of every dollar consumers spend in the United States—and, with the notable exception of tobacco, products that the American people care about and rely on in fundamental, sometimes lifesaving, ways.

But our mission also includes another role. We are the agency charged with promoting the science and innovation it takes to ensure that our nation is fully equipped to address the public health challenges of today and tomorrow. This means that our job is both to ensure the safety and efficacy of FDA-regulated products and to take real steps to foster the scientific innovation that will lead to tomorrow’s new breakthrough products.

And the industries we regulate currently lead the world in innovation, provide millions of high-paying jobs, and several are among a handful of vital industries with a positive trade balance with other countries. At the same time, we help save billions of dollars in unnecessary spending by preventing food borne illness and getting products to market that lower healthcare costs and save lives.

Of course, innovation is not just about new ideas, but also about making sure that those new ideas truly translate into the products and opportunities that people need and count on. It’s about changing systems…replacing outmoded or insufficient approaches with new, better, more effective ones—and that is what FDA has been doing, in the realms of both safety and innovation, for decades.

Now, I realize that in many quarters, innovation has become something of a buzzword, and it has taken on a variety of meanings. At FDA, though, it’s rather simple: as our nation looks ahead into the 21st century, it is increasingly clear how important it is for us to stimulate our industries, encourage entrepreneurship and creativity, and prepare to address the public health challenges that we face today and that we will face in the future. And for all of that, we need innovation. Which is why it is a central focus at FDA—and always has been.

In fact, the modern FDA was born when it became clear that our country needed an agency that would strengthen and innovate systems and fight for the health of the American people from all sides.

Back in 1902, the Martin H. Smith company advertised for a "remedy in the treatment of coughs, bronchitis…asthma, laryngitis, pneumonia, and whooping cough." According to the company—and I quote: "From scientific investigations in hospitals, clinics and sanitariums and the personal investigations by prominent physicians, no other preparation has more successfully withstood such critical scrutiny. No other preparation has had its therapeutic value more thoroughly defined or better established."

What was this wonder drug, you might ask? It was heroin.

At the turn of the century, advertisements like this one were common. Companies marketed their "patent or proprietary medicines" with a variety of unproven claims. Some were potentially deadly—and others just sugar water.

But it took decades for American medicine to emerge from what has been called a "therapeutic jungle."

As the years progressed, important scientific advances in pharmacology, toxicology, and clinical research, were central to this transformation. The FDA embraced these advances—insisted upon them, in fact—and helped pull medicine into the modern era…and, based on evidence of safety and effectiveness, helped foster the development, review and approval new, better and more innovative products.

Many of you may be aware of the famous—and defining—case 50 years ago of thalidomide…the medication that was widely marketed in Europe as a sedative and recommended for nausea for first-trimester pregnant women.

The drug turned out to be highly teratogenic, and thousands of babies across Europe suffered from a devastating birth defect that stunts the development of bone in children’s limbs.

But the drug was never approved in the United States thanks in large part to the perceptiveness and wisdom of Dr. Francis Kelsey—who refused to sign off on the drug because its sponsor failed to conduct basic tests of pharmacology and toxicology.

In a fundamental way, it was the FDA’s embrace of modern, innovative scientific methods that kept thalidomide off the market…and protected countless American lives. But thanks to those same science-driven approaches, countless other important medications have made it to market because the data has shown that the benefits outweigh the risks.

History has shown that both consumers and industry have a tremendous stake in an agency that takes science-based action on behalf of public health…an agency that not only takes action to keep Americans safe and healthy—but also promotes the science, and standards, that keep the engines of innovation running.

And this is a critical time for innovation. Unfortunately, today, the return on investment for biomedical products continues to drop. Development costs are high, timelines are long and the rates of failure remain high. As we look at the medical product pipeline, it is distressingly sparse.

Of late, there has been much focus on FDA’s role in this decline—largely because rising product development times and costs are attributed to delays and uncertainty in the regulatory approval process.

We certainly get a lot of criticism—much of it deserved—but in reality the situation is a lot more complex than often described, and it involves many factors that require meaningful strategies.
Translating a new idea from a discovery into a medical product is not easy, and it clearly involves many more players than FDA alone. We are one piece of the medical product ecosystem, which includes researchers, government, small businesses, large biotechnology and pharmaceutical companies, insurance providers or payers, physicians, and most importantly patients and the American public.

Each of these members has a unique and important role to play in bringing a new medical product to market, and each piece of the ecosystem is under stress.

At FDA, I think we can say we have a strong record of performance. We meet and often exceed nearly all of the tough review deadlines established by industry.

And we consistently approve new drugs and devices as fast as, or often faster than, any other country—including those in the European Union—while still maintaining the safety standards that Americans depend on.

And in just the first half of this year, FDA has been instrumental in bringing several groundbreaking drugs for treating devastating diseases to the market. In fact, FDA has approved 20 new medicines so far this year—just one shy of the 21 approved in all of 2010.

These include a new treatment for lupus, two new therapies for treating hepatitis C, and a new drug for metastatic melanoma.

This is great news, but we recognize that we can—and must—continue to work hard and take proactive steps to do better. We have been taking a hard look our regulatory processes, identifying ways to increase transparency, provide more clarity to the private sector, and streamline our overall processes.

But any real reform must be smart reform, and smart reform can’t happen without the input of all the major players. So I’ve spent countless hours meeting with—and listening to—the various stakeholders in the medical product development ecosystem. We’ve discussed the challenges ahead for everyone involved, as well as what works—and doesn’t work—in the current FDA regulatory framework. These meetings have been extremely informative and educational, though at times they have required me to have a thick skin!

It is clear that our nation is at an important crossroads, where the science before us presents unprecedented opportunities to create new and better medical products and to promote better health for the public. But if we don’t act now and work together, I fear we will miss the opportunity to capitalize on this groundbreaking science to bring safer and more effective treatments to the American people and keep our position as the global leader in scientific innovation.

I fully believe that success will require greater attention and investment in regulatory science—the science of developing the knowledge tools, standards and approaches needed to assess the safety, efficacy, quality, and performance of FDA-regulated products…a field that is essential to the safety and innovation work we do at FDA, and essential to medical product development…and a component of our scientific enterprise that has been dramatically underappreciated, underfunded and underdeveloped.

Without advances in regulatory science, promising therapies may be discarded during development because we lack the tools to recognize their potential and because outdated, inefficient review methods unnecessarily delay the approval of critical treatments. On the other hand, both significant dollars and many years may be wasted assessing a novel therapy that with better tools might be shown to be unsafe or ineffective at an earlier stage.

Now is the time to move forward. A robust field of regulatory science will allow us to effectively and efficiently translate many of those breakthroughs into therapies and cures.

It will foster the use of advanced genetic data and biomarkers to find faster paths to disease targets.

It will support efforts to optimize clinical trial design to speed the regulatory process and get products to patients faster.

Advancing regulatory science will require the full engagement of the scientific community and beyond. It will take new investments, approaches, and partnerships for regulatory science to evolve in the ways necessary to keep up with and capture the opportunities before us. But if we can achieve this, it really will matter.

For all of these reasons, I have made regulatory science a top priority since I became Commissioner. In addition to strengthening the science base at the FDA, we are building the partnerships—across government and with academia, industry, and the non-profit community—that will drive the development of innovative medical products and the delivery of better, safer products to the American people and to people around the world.

But while regulatory science is certainly an important step toward driving innovation, it’s only one piece of the puzzle. During the course of our internal reviews and discussions with stakeholders to identify areas for improvement at FDA, several common themes emerged. In response, I’ve been putting together an innovation initiative that outlines some important steps we can take to address these issues and drive innovation forward.

Our agenda focuses on everything from streamlining and reforming FDA regulations to creating a new rapid drug development pathway, focuses on implementing major reforms within FDA to address the most immediate concerns we’ve been hearing from stakeholders.

We’ll be releasing more details of the initiative in the coming weeks, but I want to share an important piece of it with you today—and that is FDA’s relationship with the small business community.

For quite a while now, I’ve been taking advantage of opportunities, such as President Obama’s Startup America Initiative, to hear from small business owners, particularly in the medical device and biotech arena. And in fact, I’ll be meeting later today with the heads of some small medical device companies here in Cleveland.

When I meet with small business owners, they often have quite a bit to say, and much of what they share about how they view FDA is not all that flattering. And that truly concerns me.

Small businesses are at the heart of innovation and the heart of American economic development. They are the backbone of job creation and are for many people the definition of the “American Dream.” 

We see the importance of small businesses every day at FDA. The contribution of small companies to innovation within the biomedical industries is striking. They play a crucial role in the development of new products and account for more than half of all pipeline products.

And yet, many of our small business owners and employees in the medical product space have expressed concerns that FDA regulators don’t understand their special circumstances and needs. This is clearly a relationship that needs some work. But, importantly, we know that both sides are interested in working together.

For a small business, there are unique challenges in navigating the complexities of bringing a medical product to market, including understanding the regulatory requirements for medical product review and being able to align those requirements with the tight timelines and budget pressures that most small businesses have to contend with.

Large corporations regularly submit new products to FDA, and they often have entire departments of regulatory experts that deal solely with navigating the FDA review process. But most small businesses are first-time applicants to FDA, and many have fewer than ten employees. That inexperience and lack of manpower can make it even more difficult for these companies to bring new products to market, meaning patients may not have access to a great new therapy or device.

After speaking at length with a number of small business owners, I understand that many of them feel very vulnerable in the face of what can seem like an extremely intimidating process to those who are unfamiliar with it…and their sense of financial vulnerability may be even more overwhelming. So as part of FDA’s Innovation Initiative, I am commited to taking steps to help ease the burden for small companies trying to navigate the FDA review process.

We want to build on a number of resources that FDA already has in place to more effectively engage with small businesses and provide them with tools to help them succeed.

For instance, each of our medical product centers has a small business office dedicated to helping companies navigate the FDA regulatory review process.

Now, these offices are small, some with only one or two full time employees, and, quite honestly, they do not yet receive adequate support for the mission at hand. But they are incredibly dedicated to their jobs and, like many others at FDA, manage to do great things with the resources they do have.

For instance, the small business office in our Center for Drug Evaluation and Research maintains a list-serve of more than 48,000 companies and fields literally thousands of inquiries per year. Many of these inquiries relate to the nuts and bolts of regulation, from questions about different requirements for filing new applications to how to list and register new products.

In addition to addressing the specific questions of individual companies, our small business offices also handle common questions through proactive measures, such as monthly webinars and appearances at medical conferences. They even recently started to develop a small business blog for our website to help increase and enhance engagement with the small business community.

But despite these efforts, many small businesses remain unaware of the resources we offer—and others continue to file applications that do not meet FDA’s requirements or are still unprepared for the process of bringing a product to market. After engaging both our small business offices and the small business community, it has become clear that we need to expand these programs to better meet small companies’ needs.

For starters, while our small business offices have a deep understanding of the FDA regulatory process, they lack the experience and knowledge of what it takes for a small company to effectively reach milestones and submit an application to FDA. This can create a barrier to effective communication between the FDA small business offices and the companies that seek their assistance.

So we will be establishing an Entrepreneurs-in-Residence or EIR program. This program will aim to recruit individuals who have extensive experience in starting and running small companies, and who have successfully navigated the FDA regulatory process to bring medical products to market.

EIRs will be responsible for establishing and coordinating more effective interactions between FDA and small businesses. They will work with the business staff of small companies to help them make better-informed decisions about the company’s ability to move through the FDA review process given their current resources and ability to raise capital.

Additionally, the EIRs will train FDA staff on how to engage and network with small businesses more effectively, and provide staff with a better understanding of the inherent challenges of running a small business, including the importance of timely communications to project milestone plans.

To complement this effort, we also will establish a Young Entrepreneurs program. As part of this program, the agency will offer fellowships for business, engineering, and science students as part of their educational curriculum.

We will work with universities to establish a four- to six-month internship or training course within the small business offices to provide these future entrepreneurs, venture capitalists, scientists, and inventors with first-hand access to information about regulatory review and what it takes to move a product through the FDA approval process.

We believe, together, these programs will take FDA’s relationship with small business to the next level, allowing both parties to communicate more effectively and continue to drive innovation for this important piece of the business community.

Finally, we are actively engaged with the Small Business Administration to find innovative, strategic ways to strengthen and support the diverse needs of small businesses through partnership.

As part of this partnership, we are exploring a full range of creative programs, such as an exchange program for SBA and FDA employees. This program will provide cross-educational training to provide SBA with a better understanding of FDA requirements, and to provide FDA staff about the unique needs of small companies.

These enhancements to the FDA small business program are just the first steps in strengthening a critical link in the medical product ecosystem. We hope that by bolstering this important relationship, we can expand our reach to the small business community and help more companies successfully bring important new medical products to the patients who need them.

These ideas for small business, as well as others outlined today are all areas in which we welcome the feedback and input of people like all of you—so I hope you will consider the challenges that we face today and contribute to our efforts to strengthen the FDA and promote innovation on behalf of the public health.

Thank you so much. And now I look forward to taking your questions.