FDA PLEASES NO-ONE

The FDA, considered the gold standard in drug safety review, lost its luster in 2004 after a string of high-profile drug controversies. The growing crisis ofconfidence could lead to reforms at the FDA and stricter rules on pharmaceutical firms in 2005. The year began with a firestorm, and then things got hotter. In its worst period in recent memory, the Food and Drug Administration spent 2004 reeling from charges that it allows companies to keep dangerous drugs on the market, lets them hide bad data, relies on a firm's word alone to fix manufacturing flaws, and stifles safety alerts by its own scientists. After a series of high-profile drug controversies, government investigations and the stunning withdrawal of the blockbuster drug Vioxx, critics are charging that the agency is dangerously compromised by industry influence.

True or not, the FDA's alleged weaknesses are becoming the industry's woes. The crisis of confidence over the agency's performance is so deep that consumers are hearing experts openly debate: Is the U.S. drug supply safe? The doubts have tarnished some of the biggest pharmaceutical firms and the most widely sold drugs on the market: household names like Paxil, Zoloft and Crestor. Nearly half the nation's flu vaccine supply, from Chiron's Fluvirin, was found to be contaminated. The profitable arthritis drug Vioxx was suddenly withdrawn as a heart-attack risk, amid charges that the FDA should have yanked it years ago. Now its chemical cousin, Pfizer's arthritis pain drug Celebrex, has also been linked to heart failure at high doses. And just last week, the FDA warned users of the painkiller naproxen, sold over the counter under the brand name Aleve, that the drug might increase a person's risk of having a heart attack or stroke.

The FDA's troubles began with an uproar in February over the agency's refusal to air a staff scientist's conclusion that certain anti-depressants, like Paxil, could increase the risk of suicide in children. It culminated in November, when one of the FDA's top safety staffers, Dr. David Graham, baldly declared at a U.S. Senate hearing that the agency is incapable of protecting the public. A government survey of FDA scientists showed that such doubts are pervasive, with nearly a fifth saying they had faced pressure to support a drug approval despite safety concerns.

In the perceived regulatory vacuum, a host of other players has stepped in to dog the industry: federal and state prosecutors, Congress, the Securities and Exchange Commission, eminent scientific journal editors, drug salespeople-turned whistle-blower, as well as patients, shareholders and their lawyers. For some firms, the impact has been severe:

-- Vioxx manufacturer Merck faces an international deluge of personal injury suits that could cost billions. Since Vioxx's withdrawal, Merck has lost $28.1 billion in market capitalization and is cutting 5,100 jobs.

-- Pfizer forked over $430 million to settle prosecutors' charges of marketing violations that the FDA is supposed to police. Since Celebrex was linked to heart attacks, Pfizer dropped about $21.9 billion in market capitalization.

-- Chiron of Emeryville may lose its solid share of the U.S. flu vaccine market due to lapses in the sterility of its manufacturing processes that the FDA is suspected of failing to correct in time. Chiron's market cap is down about $2.48 billion.

In the year ahead, Congress will consider proposals to revamp the FDA and toughen the rules for pharmaceutical firms. One fierce industry critic says that would not only be good for patients, it could also be good for business. Larry Sasich of the watchdog group Public Citizen said companies stand to lose the worldwide commercial advantage conferred by FDA approval if the agency loses its image as the gold standard of safety review. "We're getting to a point right now where we might start to see consumers losing confidence in the FDA,'' Sasich said. "It would be in the companies' best interests to see the standards raised.''

In the coming year, Congress may consider proposals to split the FDA's safety surveillance unit into a fully independent division. Critics charge that the concerns of safety experts like Graham are suppressed by the better- staffed drug approval units that benefit most from industry fees. The FDA denies those claims but has recently taken steps to give dissenters a greater voice.

Dr. Eric Topol, a prominent cardiologist who raised early alarms about Vioxx, said Congress hasn't given the FDA new powers to keep up with changing times. "The FDA doesn't have any authority to disseminate data that (it has)," he said, because information submitted in the drug approval process is considered proprietary. On the other hand, Topol said, the industry now has free rein to tout its drugs in direct-to-consumer ads. Patients then clamor for the new drugs, but doctors don't have complete information about them, he said.

Arthur Levin, director of the Center for Medical Consumers, said patients can help fix the system if they stop expecting drugs to be silver bullets that cure ailments without causing side effects.... Rosen said the industry group has yet to take a position on proposals to change the FDA. But he agreed with Levin that expectations should be more realistic. "All medicines have risks, and the job of the FDA is to balance the benefits versus the risks," he said. "If the FDA can be made stronger, we're certainly interested in sitting down and talking to folks about that.''

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For greatest efficiency, lowest cost and maximum choice, ALL hospitals and health insurance schemes should be privately owned and run -- with government-paid vouchers for the very poor and minimal regulation.

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