    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

                PDUFA V: MEDICAL INNOVATION, JOBS, AND PATIENTS

    =======================================================================

                                    HEARING

                                   BEFORE THE

                             SUBCOMMITTEE ON HEALTH

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                                  JULY 7, 2011

                                   __________

                               Serial No. 112-70

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

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                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman

    JOE BARTON, Texas                    HENRY A. WAXMAN, California
      Chairman Emeritus                    Ranking Member
    CLIFF STEARNS, Florida               JOHN D. DINGELL, Michigan
    ED WHITFIELD, Kentucky                 Chairman Emeritus
    JOHN SHIMKUS, Illinois               EDWARD J. MARKEY, Massachusetts
    JOSEPH R. PITTS, Pennsylvania        EDOLPHUS TOWNS, New York
    MARY BONO MACK, California           FRANK PALLONE, Jr., New Jersey
    GREG WALDEN, Oregon                  BOBBY L. RUSH, Illinois
    LEE TERRY, Nebraska                  ANNA G. ESHOO, California
    MIKE ROGERS, Michigan                ELIOT L. ENGEL, New York
    SUE WILKINS MYRICK, North Carolina   GENE GREEN, Texas
      Vice Chair                         DIANA DeGETTE, Colorado
    JOHN SULLIVAN, Oklahoma              LOIS CAPPS, California
    TIM MURPHY, Pennsylvania             MICHAEL F. DOYLE, Pennsylvania
    MICHAEL C. BURGESS, Texas            JANICE D. SCHAKOWSKY, Illinois
    MARSHA BLACKBURN, Tennessee          CHARLES A. GONZALEZ, Texas
    BRIAN P. BILBRAY, California         JAY INSLEE, Washington
    CHARLES F. BASS, New Hampshire       TAMMY BALDWIN, Wisconsin
    PHIL GINGREY, Georgia                MIKE ROSS, Arkansas
    STEVE SCALISE, Louisiana             ANTHONY D. WEINER, New York
    ROBERT E. LATTA, Ohio                JIM MATHESON, Utah
    CATHY McMORRIS RODGERS, Washington   G.K. BUTTERFIELD, North Carolina
    GREGG HARPER, Mississippi            JOHN BARROW, Georgia
    LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
    BILL CASSIDY, Louisiana              DONNA M. CHRISTENSEN, Virgin
    BRETT GUTHRIE, Kentucky              Islands
    PETE OLSON, Texas
    DAVID B. McKINLEY, West Virginia
    CORY GARDNER, Colorado
    MIKE POMPEO, Kansas
    ADAM KINZINGER, Illinois
    H. MORGAN GRIFFITH, Virginia

                                     7_____

                             Subcommittee on Health

                         JOSEPH R. PITTS, Pennsylvania
                                     Chairman
    MICHAEL C. BURGESS, Texas            FRANK PALLONE, Jr., New Jersey
      Vice Chairman                        Ranking Member
    ED WHITFIELD, Kentucky               JOHN D. DINGELL, Michigan
    JOHN SHIMKUS, Illinois               EDOLPHUS TOWNS, New York
    MIKE ROGERS, Michigan                ELIOT L. ENGEL, New York
    SUE WILKINS MYRICK, North Carolina   LOIS CAPPS, California
    TIM MURPHY, Pennsylvania             JANICE D. SCHAKOWSKY, Illinois
    MARSHA BLACKBURN, Tennessee          CHARLES A. GONZALEZ, Texas
    PHIL GINGREY, Georgia                TAMMY BALDWIN, Wisconsin
    ROBERT E. LATTA, Ohio                MIKE ROSS, Arkansas
    CATHY McMORRIS RODGERS, Washington   JIM MATHESON, Utah
    LEONARD LANCE, New Jersey            HENRY A. WAXMAN, California (ex
    BILL CASSIDY, Louisiana                  officio)
    BRETT GUTHRIE, Kentucky
    JOE BARTON, Texas
    FRED UPTON, Michigan (ex officio)

                                      (ii)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Joseph R. Pitts, a Representative in Congress from the
      Commonwealth of Pennsylvania, opening statement................     1
        Prepared statement...........................................     3
    Hon. Michael C. Burgess, a Representative in Congress from the
      State of Texas, opening statement..............................     4
    Hon. Frank Pallone, Jr., a Representative in Congress from the
      State of New Jersey, opening statement.........................     4
    Hon. John D. Dingell, a Representative in Congress from the State
      of Illinois, opening statement.................................     5
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, opening statement....................................     6
        Prepared statement...........................................     8
    Hon. Phil Gingrey, a Representative in Congress from the State of
      Georgia, opening statement.....................................    10
    Hon. Henry A. Waxman, a Representative in Congress from the State
      of California, opening statement...............................    10
        Prepared statement...........................................    13

                                   Witnesses

    Janet Woodcock, Director, Center for Drug Evaluation and
      Research, Food and Drug Administration.........................    16
        Prepared statement...........................................    18
        Answers to submitted questions...............................   154
    Paul J. Hastings, President and Chief Executive Officer, OncoMed
      Pharmaceuticals, Inc...........................................    77
        Prepared statement...........................................    80
    Jonathan S. Leff, Managing Director, Warburg, Pincus LLC.........    93
        Prepared statement...........................................    95
    Marc Boutin, Executive Vice President and Chief Operating
      Officer, National Health Council...............................   110
        Prepared statement...........................................   112
    Ellen V. Sigal, Chair and Founder, Friends of Cancer Research....   122
        Prepared statement...........................................   124
    Allan Coukell, Director of Medical Programs, Pew Health Group,
      The Pew Charitable Trusts......................................   129
        Prepared statement...........................................   131

                               Submitted Material

    Statement, dated July 7, 2011, of the American Hospital
      Association, submitted by Mr. Engel............................    58
    Letter, dated February 8, 2012, from Jeanne Ireland, Assistant
      Commissioner for Legislation, Food and Drug Administration,
      Department of Health and Human Services, to Mr. Dingell........   150

                PDUFA V: MEDICAL INNOVATION, JOBS, AND PATIENTS

                                  ----------

                             THURSDAY, JULY 7, 2011

                      House of Representatives,
                                Subcommittee on Health,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 10:00 a.m., in
    room 2123, Rayburn House Office Building, Hon. Joseph R. Pitts
    (chairman of the subcommittee) presiding.
        Present: Representatives Pitts, Burgess, Shimkus, Rogers,
    Myrick, Murphy, Blackburn, Gingrey, Latta, Lance, Cassidy,
    Guthrie, Upton (ex officio), Pallone, Dingell, Engel, Capps,
    Gonzalez, and Waxman (ex officio).
        Also present: Representatives Bilbray and Christensen.
        Staff present: Gary Andres, Staff Director; Clay Alspach,
    Counsel, Health; Howard Cohen, Chief Health Counsel; Ryan Long,
    Chief Counsel, Health; Alan Slobodin, Deputy Chief Counsel,
    Oversight; Jeff Mortier, Professional Staff Member; Andy
    Duberstein, Special Assistant to Chairman Upton; Debbee Keller,
    Press Secretary; Chris Sarley, Policy Coordinator, Environment
    and Economy; Heidi Stirrup, Health Policy Coordinator; Lyn
    Walker, Coordinator, Admin/Human Resources; Carly McWilliams,
    Legislative Clerk; Kirby Howard, Legislative Clerk; Rachel
    Sher, Minority Senior Counsel; Stephen Cha, Minority Senior
    Professional Staff Member; Alli Corr, Minority Policy Analyst;
    Karen Lightfoot, Minority Communications Director and Senior
    Policy Advisor; Eric Flamm, FDA Detailee; and Karen Nelson,
    Minority Deputy Committee Staff Director for Health.
        Mr. Pitts. The subcommittee will come to order. The Chair
    recognizes himself for 5 minutes for an opening statement.

    OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN
             CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

        The Prescription Drug User Fee Act, PDUFA, was first
    authorized by Congress in 1992 with the goal of expediting
    human drug applications through the Food and Drug
    Administration's approval process. Under the Act and in
    subsequent reauthorization, the drug industry pays user fees to
    FDA, and FDA commits to meet performance goals such as
    reviewing applications within a certain period of time. This
    construct was designed to give industry certainty and
    predictability, but also to speed new drugs and treatments to
    the public. Details of the agreement between FDA and industry
    will be published on September 1st of this year, and by January
    15, 2012, FDA will send its final recommendations to Congress.
        The current PDUFA authorization expires September 30, 2012,
    and it is my intention to have the reauthorization legislation
    signed into law by June 30 of next year. PDUFA is too important
    to leave to the last minute. The drug industry employs
    thousands of people here in the United States, providing good
    jobs that we cannot afford to lose.
        The forthcoming study from Patel Memorial Institute has
    found that every job in the biopharmaceutical sector supports
    nearly six additional jobs in the greater economy. If PDUFA is
    not reauthorized, this study estimates that 130,000 to 260,000
    jobs would be lost. Americans are the most innovative people on
    Earth.
        Given certainty, predictability and transparency in the
    approval process, venture capitalists will continue to fund new
    research and companies will continue to develop new and
    innovative drugs. What we have heard, however, is that
    certainty, predictability and transparency oftentimes do not
    characterize the FDA's approval process. Frustrating both the
    drug sponsors and the public who are waiting for treatments and
    cures to everyday maladies, chronic illnesses and terminal
    diseases.
        The American people expect and have a right to expect that
    the Federal Government is doing everything possible to ensure
    that drugs on the market are safe and effective. They also have
    a right to expect that applications for life-enhancing and
    lifesaving drugs are not languishing on a reviewer's desk at
    the FDA. It is my hope that the new agreement balances both of
    these considerations, and I look forward to hearing from FDA,
    the drug industry, patient advocates and researchers today on
    our panels.
        I yield the remainder of my time to Dr. Burgess.
        [The prepared statement of Mr. Pitts follows:]

        [GRAPHIC] [TIFF OMITTED] T2917.001

    OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE
                  IN CONGRESS FROM THE STATE OF TEXAS

        Mr. Burgess. I thank the chairman for yielding.
        I am mindful of the fact that the last reauthorization was
    June of 2007, so it is a little over 4 years ago. At that time,
    I was concerned about some of the restrictions that this
    committee placed on the advisory panels that advise the FDA
    about the approval or non-approval of drugs and devices. One of
    my concerns was we didn't follow the Institute of Medicine
    guidelines that no more than 40 percent of the people who are
    on the advisory committees have an interest in the product
    under consideration, and it was the will of the committee over
    my objections that no one on these advisory panels should have
    any interest or perhaps even any knowledge of the drug or
    device being considered.
        I thought that was a serious and glaring oversight on the
    part of this committee, and I discussed it with then-Chairman
    Dingell extensively and offered amendments that were repeatedly
    voted down on party lines. But that is an oversight that I hope
    that this committee can now correct in this reauthorization
    period.
        It appears we saw it unfortunately on display with the
    Avastin advisory panel last week in that there, to the best of
    my reading of the makeup of that group, there was not a
    specialist who dealt with breast cancer patients on that
    advisory panel so that there was no one on that advisory panel
    who actually followed a patient who was on Avastin for their
    breast cancer. Now we are left to defend the decision from the
    advisory panel to the FDA about the removal of that drug. And
    we are in a difficult position with Avastin because some people
    are apparently dramatically helped. Other people, the help is
    not so great. But it is, I think, incumbent upon us to get that
    right.
        Other things that I think we need to do, we need to discuss
    the possibility of surrogate endpoints for studies within the
    FDA. Certainly that was useful in the early days of the AIDS
    research back in the 1980s. And the fact that we base
    everything upon survival statistics now and we are not looking
    at things like tumor burden or some other surrogate endpoint I
    think is a mistake on the part of our advisory panels.
        I thank the chairman for yielding the time and I yield back
    the balance of my time.
        Mr. Pitts. I thank the gentleman and recognize the ranking
    member of the subcommittee, Mr. Pallone, for 5 minutes for an
    opening statement.

    OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
                IN CONGRESS FROM THE STATE OF NEW JERSEY

        Mr. Pallone. Thank you, Chairman Pitts, and I welcome
    today's hearing on this very important subject.
        Five years ago, this committee led the way in making grade
    strides in FDA policy and safety measures. In fact, some have
    said it was the most extensive overhaul of FDA policy and
    procedure in decades. What is important to note, however, is
    that this committee worked through the issues in a bipartisan
    manner, and I am proud of the consensus that we reached.
        That legislation was supported by members, consumer groups
    and industry stakeholders. Together we recognized the need for
    a strong and well-resourced FDA to complete its mission. In
    addition, we accepted the reality that FDA must have the
    ability to be well-versed on the best science in order to get
    the safest and most effective drugs to the marketplace.
        Now, in doing so I recognize that FDA must minimize the
    inappropriate burden it placing on the drug companies so that
    they do not stifle innovation. America's competitiveness
    depends on our ability to innovate and keep America number one,
    and as such I continue to believe that the government must be
    responsible for facilitating an environment where Americans can
    continue to innovate. This is the key to creating new thriving
    industries that will produce millions of good jobs here at home
    and a better future for the next generation. That said, we must
    not sacrifice safety and efficacy in exchange for innovation.
    PDUFA has been a true success and we must build on that
    success. We can't move backwards under the auspices of economic
    benefits.
        So, Mr. Chairman, I hope we can move in the same bipartisan
    spirit as we did in 2007. Even more so, I hope that we can
    produce consensus legislation free of conflict and contentious
    issues. I look forward to working with you and my colleagues on
    this committee as this process moves forward and I welcome
    today's hearing as a first step towards that goal.
        I wanted to yield 2 minutes to my good friend from
    Michigan, Chairman Dingell, but I still have another minute
    left, so let me say that I would like to close by commenting on
    the importance of the Drug Safety Enhancement Act. That is a
    bill that I coauthored with Mr. Dingell and Representatives
    Waxman and DeGette.
        High-profile risks associated with the globalized drug
    supply like the Heparin crisis of 2007 have put Americans'
    lives at risk and our bill would equip FDA with the authorities
    and resources this it needs to keep peace with an increasing
    international marketplace of products so that Americans can
    have confidence that drugs they rely on will help them get
    better and not make them more sick.
        So as we move forward, I will continue, Mr. Chairman, to
    make reference to the Drug Safety Enforcement Act and that bill
    because I do think it is important and also has a place during
    this PDUFA debate.
        I see the gentleman is here. I yield to Chairman Dingell.

    OPENING STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF MICHIGAN

        Mr. Dingell. Mr. Chairman, I thank the gentleman and I
    thank you for holding today's hearings. I ask unanimous consent
    to revise and extend my remarks because of the shortness of
    time here.
        I commend you for the hearing today with regard to the FDA
    amendments that we are discussing with regard to PDUFA. This is
    important. If everyone will recall, it has been accepted, it
    has been a tremendous success because of the cooperation
    between government and industry.
        However, we need to address more problems. Commonsense
    authorities, like mandatory recalls, subpoena power, ability to
    seize and destroy imported drugs and raw materials at the
    border, making delay or refusal for inspection a prohibited
    act, are now needed to ensure that Food and Drug has the
    capabilities to properly oversee safety of our drug supply.
        These are authorities that would be given FDA under H.R.
    1483, the drug safety bill I introduced with my colleagues Mr.
    Waxman, Mr. Pallone and Mrs. DeGette. These are authorities
    that are desperately needed in order to address the safety of
    our American public. I would note that without them, imports of
    dangerous components and raw materials of pharmaceuticals, as
    in the case of Heparin, continue to threaten the well-being of
    our people.
        My colleagues will remember that in the last Congress, we
    passed a food safety bill, which gave many of these authorities
    to Food and Drug, and which was, in fact, supported by the
    industry. It passed out of this committee by a heavy majority.
    It also passed the House and the Senate by a very large
    majority, and it is now standing to help and protect the
    American people.
        I would hope that we would follow the example that we set
    last Congress when we worked together in a remarkably
    bipartisan fashion to see to it that we went well beyond just
    scratching the surface with regard to food safety and do a
    similar thing with regard to prescription pharmaceuticals and
    so move to protect the health, safety, life expectancy and to
    ensure that pharmaceuticals will not cause harm or death,
    particularly where it is from imported raw materials for the
    manufacture of finished products.
        I thank you, Mr. Chairman. I thank the gentleman from New
    Jersey. I yield back the balance of my time.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the full committee chairman, Mr. Upton, for 5 minutes.

       OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF MICHIGAN

        Mr. Upton. Thank you, Mr. Chairman.
        This is the first hearing of the 112th Congress on the
    reauthorization of Prescription Drug User Fee Act in the
    current state of medical innovation in America. I look forward
    to discussing FDA regs and how they effect innovation, job
    creation and the American patient's accession to life-improving
    drugs.
        Congress last reauthorized PDUFA in 2007 with the Food and
    Drug Administration Amendments Act. That law as we know expires
    in September of 12, 2012, which is why our work to reauthorize
    this law begins today.
        One area that the committee will examine is the lack of
    predictability and certainty at the FDA. These problems at FDA
    appear to be stifling American innovation, costing Americans
    jobs and obviously hurting American patients. Another area we
    will examine is the risk-benefit analysis used by FDA when
    approving drugs and whether the agency is striking the right
    balance on delicate issues. These are concerns that the FDA is
    failing to consider the views of patients who need access to
    lifesaving drugs, including those drugs that carry some risk.
        The committee will evaluate provisions of the Food and Drug
    Administration Act amendments, including those affecting
    advisory committees in the risk evaluation and mitigation
    strategies. The rigid unrealistic conflict of interest
    provision has prevented in my view the FDA and its advisory
    committees from utilizing some of science's best minds and left
    advisory committee slots unfilled. We have to look at the
    implementation of this provision as to whether it really has
    caused delays in the approval process.
        Our goal has to ensure America remains the leader in
    medical innovation. When the law works properly, the field
    creates new jobs and ensures American patients do have access
    to the best therapies available.
        I thank the chairman, and I yield the balance of my time to
    Dr. Gingrey.
        [The prepared statement of Mr. Upton follows:]

        [GRAPHIC] [TIFF OMITTED] T2917.002

        [GRAPHIC] [TIFF OMITTED] T2917.003

      OPENING STATEMENT OF HON. PHIL GINGREY, A REPRESENTATIVE IN
                   CONGRESS FROM THE STATE OF GEORGIA

        Mr. Gingrey. I thank the overall chairman for yielding to
    me.
        I believe the Prescription Drug User Fee Act
    reauthorization gives an opportunity to review the ways in
    which we can help improve the FDA approval process. In an age
    where our economy is fighting an international battle to remain
    the leader in medical innovation and the jobs that goes with
    those industries and patients in other countries have access to
    medical treatments that American patients do not, we need all
    hands on deck. No longer can we afford to sideline experts
    simply because of their ties to industry.
        One idea I believe that deserves consideration, Mr.
    Chairman, is drawing from the joint NIH-FDA Leadership Council.
    This council was created in 2010 to spearhead collaborative
    efforts to improve the FDA regulatory review process. This
    initiative is a good, proactive first step toward improving and
    modernizing the FDA.
        However, I believe if we are going to be truly successful
    in improving both the efficiency of the FDA as well as our
    understanding of how emerging technology can be used to improve
    regulatory review, other parties need to be at the table.
    Agencies like the CDC and Homeland Security, experts from the
    drug industry and academia, as well as patient advocates all
    need to be involved. A stakeholder group made up of various
    agencies, scientific leaders and business and academia and
    patient advocates can help support the FDA in its mission to
    advance regulatory science as well as other meaningful reforms
    and emerging public health issues. I look forward to working
    with Dr. Hamburg, the chairman and this committee on the issue.
        In addition, this committee has spent years studying the
    oncoming public health threat posed by antibiotic resistance.
    It is a threat to our patients, it is a threat to our troops,
    and in the hands of terrorists, our national security. My
    colleagues and I on this committee, four Republicans, three
    Democrats, have introduced H.R. 2182, the GAIN Act. If we are
    to have the drugs needed to fight the looming threat of drug
    resistant bacteria, our legislation is an important first step
    in that fight. I hope to see it considered by this committee,
    this Congress, the 112th.
        With that, Mr. Chairman, I thank the overall chairman for
    yielding to me and I yield back the remaining time.
        Mr. Pitts. The chair thanks the gentleman and at this time
    recognizes the ranking member of the full committee, Mr.
    Waxman, for 5 minutes for an opening statement.

    OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mr. Waxman. Thank you, Chairman Pitts, for holding this
    hearing today.
        I think we can all agree that it is critically important
    that there be a vibrant and flourishing innovation in the
    pharmaceutical industry. The medicines this industry has
    brought us have saved countless lives and improved the quality
    of life for people the world over. Unfortunately, by most
    accounts we are in the midst of a dramatic slowdown in drug
    development in the U.S. The reasons for the slowdown are
    complex and multifaceted. At a time when you would expect there
    to be a surge of innovation, for example, because there is an
    unprecedented number of drugs coming off patent, the opposite
    appears to be true. I hope our witnesses will help us
    understand what is causing this innovation deficit and what we
    can do to help our drug companies succeed.
        A rising chorus of voices have begun to assert the view
    that it is the FDA that is responsible for this downward trend.
    These critics claim that the FDA takes far longer to approve
    drugs than its counterparts in Europe. Some claim it takes the
    U.S. twice as long as Europe. Others claim it takes three times
    as long. These claims may sound convincing, but we have yet to
    see the data to support them.
        I am aware of only one peer review study comparing drug
    approval times in the United States and Europe, and it found
    the exact opposite. This study, which examined the approval of
    35 new cancer drugs, was conducted by one of our witnesses
    today, the Friends of Cancer Research. It found that the FDA is
    actually approving these lifesaving therapies much faster than
    its European counterparts.
        Some view every decision FDA makes through the prism of
    whether it is good for the pharmaceutical industry. But that is
    not the right perspective. The question we should be asking is,
    what is the right decision for patients? It is in no one's
    interests to have a weak FDA. American consumers depend on FDA
    to verify the drugs we are taking are truly safe and effective.
    If Americans lose confidence in the FDA, they will lose
    confidence in the pharmaceutical industry as well.
        We should all be united in the goal of ensuring that we
    have a strong, well-resourced FDA that is armed with a full
    compliment of authorities to protect us from unsafe drugs and
    to assure that these drugs work. That is FDA's fundamental
    mission, and that is why I strongly oppose any legislative
    proposal that would prevent FDA from insisting on adequate data
    from clinical trials and force it to approve drugs on an
    incomplete record. These proposals would prove disastrous for
    the safety and efficacy of our drugs supplied.
        The title of this hearing suggests that our colleagues
    across the aisle believe that FDA's mission should encompass
    job creation. Democrats have been leading the charge for
    legislation to promote jobs and we have been bitterly
    disappointed by the failure of the House to pass pro-jobs
    legislation. But we should not be misled. I hope we would all
    agree that FDA should not take jobs into consideration when it
    is reviewing the safety and effectiveness of a new medicine. We
    want FDA to ensure that the drugs we take are safe and
    effective. Whether jobs will be created is simply not a part of
    that scientific public health equation.
        I do believe there are areas in which the agency's
    regulation of drugs could improve. For example, improvements in
    FDA's scientific capacities will enable FDA to identify early
    end-points that can predict whether a drug will be effective
    which can result in better design of clinical trials and faster
    approval of new drugs. Making these kinds of strides require we
    work from real data, not self-serving urban myths.
        We should require a significant influx of resources. It is
    ironic that at the same time they are complaining that FDA
    should do a better job, the Republicans in the House passed a
    budget and an appropriations bill that would gut FDA funding by
    over $500 million.
        I want to turn briefly to the fact that we have an
    increasing globalization of our drug supply. The world has
    changed from the time of the original Food, Drug and Cosmetic
    Act. Today, more than 80 percent of active pharmaceutical
    ingredients are manufactured abroad, with China and India
    comprising the largest sources. Just yesterday, The Wall Street
    Journal talked about poor regulatory oversight of Chinese
    pharmaceuticals. That is why it is important to look at the
    Drug Safety Enhancement Act, which will go a long way toward
    providing FDA with these much-needed resources.
        Mr. Chairman, our staff has reached out to your staff and
    Mr. Upton's as well requesting we engage in a bipartisan
    process to look at this bill and work toward incorporating
    whatever we can ultimately agree upon into the PDUFA package
    next year. I hope we can count on this opportunity to work
    together because it is in the public interest.
        Thank you very much, Mr. Chairman.
        [The prepared statement of Mr. Waxman follows:]

        [GRAPHIC] [TIFF OMITTED] T2917.004

        [GRAPHIC] [TIFF OMITTED] T2917.005

        [GRAPHIC] [TIFF OMITTED] T2917.006

        Mr. Pitts. The chair thanks the gentleman. The chair thanks
    the members for their opening statements. Any other opening
    statements will be entered into the record.
        The chair thanks the witnesses for agreeing to appear
    before the committee today. Your written testimony will be made
    a part of the official record. We ask you summarize your
    opening statements in 5 minutes.
        We have two panels today. The first panel contains a single
    witness. Dr. Woodcock is the Director of the Center For Drug
    Evaluation and Research at the Food and Drug Administration.
        Welcome, Doctor. You may begin your testimony.

        STATEMENT OF JANET WOODCOCK, DIRECTOR, CENTER FOR DRUG
         EVALUATION AND RESEARCH, FOOD AND DRUG ADMINISTRATION

        Ms. Woodcock. Thank you, Mr. Chairman and members of the
    subcommittee. I am Janet Woodcock, Director of the Center For
    Drug Evaluation and Research at FDA, and I would like to thank
    you for this opportunity to testify about the prescription drug
    user fee program, or PDUFA, as I am going to refer to it.
        Congress instituted this program because patients in the
    United States were not getting access to new medicines as
    quickly as people in other parts of the world. This problem is
    called the drug lag, and it became particularly severe in the
    1980s.
        The chart we have brought, which you can see over there,
    shows that PDUFA really had an impact on this drug lag. In the
    1980s, as you see, fewer than 10 percent of new medicines
    reached American patients first. They were available first in
    other parts of the world. PDUFA was started in 1992 and, as the
    data show, it quickly improved the availability of new
    medicines to the point now where we lead the world in
    introduction of new medicines.
        I am a rheumatologist. I am a doctor who treats autoimmune
    diseases and arthritis, and I can attest to the revolution of
    therapies that has occurred since the start of PDUFA. Diseases
    that were crippling now have effective treatments that allow
    patients to lead full lives.
        Recently, my seat mate on a plane showed me pictures of her
    wonderful gardens that she cared for herself. She told me that
    10 years ago she was confined to a nursing home and it was only
    when she was started on a treatment, a new treatment for her
    autoimmune disease, that she was able to improve and is now
    active and well. This is the kind of treatments that we have
    seen coming out during the PDUFA period.
        So since the start of PDUFA, increasing numbers of new
    medicines were available first in the United States. Currently
    we lead all other countries in the introduction of new
    therapies. Every 5 years, PDUFA must be reauthorized, and each
    cycle of reauthorization has brought new enhancements to the
    program. Most recently, there has been a focus on improving
    drug safety monitoring and that was the focus of the last
    cycle. Successful innovations, such as our sentinel initiative,
    resulted from that safety focus.
        For this cycle of PDUFA renegotiation, Congress directed
    FDA to conduct a very open and inclusive process with
    significant stakeholder participation. We have done so, as
    detailed in my written testimony, and I believe the outcomes of
    the negotiation have really been improved as a result of this
    new process.
        Now, the drug development enterprise is in a very different
    place than previous PDUFA negotiation cycles. Drug development
    faces many of the problems other industries do right now due to
    the economic turn-down. But more significantly, there is a
    severe productivity problem worldwide in drug development in
    which an ever-increasing R&D investment is producing ever-fewer
    new drugs. This isn't just true in the U.S. It is true
    everywhere. It is no exaggeration to say that the industry is
    in crisis.
        At the same time, the scientific opportunities have never
    been greater. It is incredibly frustrating to see the explosion
    in biomedical knowledge and at the same time to watch the
    struggles and repeated failures of drug development programs
    that try to utilize this knowledge. Despite these serious
    problems, things may be looking up. This year to date, FDA has
    approved 20 new medicines, just one short of the total approved
    last year, and many of these medicines are game-changers for
    patients. We do see a rise in new development programs coming
    into the FDA as well.
        We have been moving through the process set down by
    Congress for this cycle of PDUFA negotiations and we have
    developed a set of recommendations that are laid out in my
    written testimony. These include new steps to incorporate
    scientific advances into regulation so we can do what we can
    for the problems that industry is facing; also providing for
    meaningful patient input into the standards of benefit and risk
    that FDA applies to these new products; to provide a more
    transparent and predictability review process for sponsors, and
    there is quite a bit in there for that; and to further enhance
    drug safety.
        In closing, I would say that in addition to these
    challenges, the pharmaceutical industry and FDA does face the
    challenges of globalization, which are ever-increasing and are
    well covered, and I am sure you are aware of, both in clinical
    trials being done all around the world and medicines being made
    all around the world. We still have to ensure the safety and
    effectiveness for our patients.
        We look forward to working with Congress on all these
    challenges. We feel that the success that is demonstrated of
    PDUFA can be extended and we can do the right things, both for
    the patients in this country and for the industry that brings
    them new medicines.
        [The prepared statement of Ms. Woodcock follows:]

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        Mr. Pitts. Thank you. I will now begin the questioning and
    recognize myself for 5 minutes.
        Mr. Gingrey. Mr. Chairman, we cannot hear you. Your mic may
    not be working.
        Mr. Pitts. All right. I will hold it closer.
        According to reports from the California Health Care
    Institute, and Ernst & Young and testimony here today, FDA's
    regulatory uncertainty is stifling American job creation. To
    compound the problem, foreign countries like those of the EU,
    China and India, are proactively trying too take American jobs
    by making their regulatory systems more predictable and
    efficient and creating an ideal innovation climate for
    companies. Given the importance of these innovator companies to
    our country and our Nation's patients, these developments are
    disconcerting, to say the least.
        While foreign regulatory bodies are becoming more
    efficient, FDA appears to be going in the opposite direction.
    Is FDA, first of all, aware that these foreign countries are
    proactively trying to take American jobs?
        Ms. Woodcock. We are aware that both Europe, which has the
    Innovative Medicines Initiative, Singapore, China, many
    countries are looking to build a very strong R&D biomedical
    development industry in their countries. Absolutely.
        Mr. Pitts. The second question: What is FDA's role in
    creating a hospitable climate for American innovator companies
    so that they can create jobs and create new lifesaving
    therapies for patients here?
        Ms. Woodcock. Well, first of all, I would like to start
    with the facts, all right? That chart shows when the U.S. is
    the country that first launches a drug in our country, and you
    can see that is continuing to go up. So that is compared to all
    other countries worldwide.
        You will also hear testimony about a comparison to Europe.
    And we are not in competition with Europe, but you can see in
    the U.S., the drug approval process is faster and drugs reach
    patients more quickly than in Europe. That is simply one
    comparison. However, we, since 2004 when we put out what was
    called the Critical Path Report, have been working with
    industry to try to solve a lot of both the scientific and
    regulatory problems that impede innovation and keep drug
    development from proceeding smoothly.
        So we are very aware of this. It is a problem for us as
    well as for the industry. The people who work at the Center for
    Drugs and regulate new drugs are doctors, and they are
    rheumatologists and they are pulmonologists and they are cancer
    doctors and infectious disease doctors. They know their
    patients need additional therapies and they want to see them
    out there for the patients. So this drug development enterprise
    is important for everyone and it is important to get it right.
        Mr. Pitts. And what has the FDA done to forestall the
    attempts by the EU, China and India to take our jobs?
        Ms. Woodcock. FDA has a very predictable drug review
    process. In fact, our review process is the most predictable
    part of drug development. If you can get through all the
    clinical phases of drug development where you test it on
    people, the process that FDA uses is extremely predictable. And
    that is a result of the user fee program.
        Right now we have the highest rate ever of what we call
    first cycle approvals, which is if companies send in their
    application, they get it approved on the first try. And we have
    timelines for that and we meet our timelines of review. So we
    have a very predictable and open process, and companies usually
    come first to the United States with applications for their new
    drugs.
        Mr. Pitts. OK, another question. I have heard from many
    patients that they believe their interests are not taken into
    account during the FDA approval process. Patients, including
    those with life-threatening diseases, are willing to tolerate
    additional risk in order to try these new drugs that will
    hopefully save their lives. How does FDA take patients into
    account when reviewing new drugs and how does it account for
    patients and their willingness to tolerate additional risk?
        Ms. Woodcock. The patients are the most important part of
    this. It is really for patients that medicines are developed
    and that the FDA does the review process, and we fully
    understand that people facing more serious diseases are willing
    to take higher risks.
        For example, we have a drug for multiple sclerosis that
    causes sometimes a rare, very serious and often fatal brain
    disease, and that drug was briefly withdrawn from the market
    because of doing this. When we talked to the patients, they
    said we are willing to take this risk, because this drug really
    helps prevent the progression of multiple sclerosis. That drug
    is available now to patients because we understand that when
    you face such terrible diseases, you are willing to take risks.
        Mr. Pitts. My time has expired. I recognize the ranking
    member for 5 minutes for questions.
        Mr. Pallone. Thank you, Mr. Chairman. And Dr. Woodcock,
    some of my questions are along the same topic, if you will, as
    the chairman. I guess this really shows that we are being
    bipartisan today.
        Most of my colleagues have been told that FDA is
    responsible for what is claimed to be a significant slowdown in
    development and marketing of new and innovative
    pharmaceuticals. Whether that is true or not, that is what we
    are told.
        There is a statement in Mr. Leff's testimony, he is on the
    next panel, which sums up what I hear. He states, ``While many
    factors have contributed to the escalating cost, time, and risk
    of new drug development, a changing regulatory environment at
    the FDA is the most significant.''
        He attributes this, in large part, to increasing public
    pressure on FDA to focus more on safety and lesson benefit in
    the wake of the emergence of safety problems associated with
    Vioxx in 2004. He further points to numbers showing that FDA
    approved an average of 36 new drugs and biologics per year from
    1996 to 2004, but an average of only 21 per year from 2005 to
    2010.
        My question is, how do you respond to these claims? Is it
    really true that there was a sudden dropoff in approvals right
    after 2004 and that approvals in the years immediately
    preceding 2004 were well over one and a half times as frequent
    as in the years immediately after 2004, and has FDA really
    become too risk averse and not focused enough on benefits such
    that maybe innovation is being blocked.
        Ms. Woodcock. Well, I appreciate these questions. As a
    physician, I will tell you, I think it is important, though, to
    establish the diagnosis before we move to treatment. So it is
    really important to understand the facts.
        The facts are, first of all, as we have already discussed,
    the FDA approves drugs and gets them on the market more
    regularly first than any other country in the world, all right?
    We are meeting all of our PDUFA goals for review times, so our
    review time is very prompt. We are approving more than two-
    thirds of critical new drugs, those important new drugs that
    will make a difference for patients, on the first round. After
    they are approved, we review them and then they get on to the
    market. And we have the highest rate historically in 20 years
    right now of these first round approvals.
        So FDA is moving promptly and is approving a high
    percentage of the drugs that are submitted to us. However, we
    can't approve drugs that don't come in the door. And this
    slowdown is worldwide. This is not a FDA phenomenon. The
    pharmaceutical industry is suffering a crisis and we are not
    seeing as many submissions to us, nor is the EU, nor are the
    other regulatory authorities around the world, and this
    scientific challenge I think is the major problem that we face.
        Mr. Pallone. You have already, in response to the
    chairman's question, mentioned Europe. I read a study published
    in the July issue of Health Affairs by Friends of Cancer
    Research, which found that FDA actually approves cancer drugs
    significantly more quickly than its counterpart in Europe. Now,
    that was just for cancer drugs. But how does FDA compare with
    Europe in approval times of other classes of drugs besides
    cancer drugs?
        Ms. Woodcock. This is true for all of the high priority
    drugs that are going to make a difference for patients. We
    don't have all the data in a tabular form that we can give you,
    but we have looked into this.
        For example, we just approved two drugs for hepatitis C--
    treatment of hepatitis C. Hepatitis C has been poorly treated.
    The treatment has difficult side effects and it often leads to
    liver failure and need for liver transplant and even death. We
    have just approved two new drugs that have a high rate of what
    is called virological response or cure, so we expect that many
    more people will be able to be cured for hepatitis C. Those two
    drugs are not approved anywhere else in the world right now.
        Mr. Pallone. Let me just ask you, would you say FDA could
    make some improvements in terms of helping industry proceed
    through the regulator process, and more specifically, where do
    you think the major roadblocks are going from earliest research
    to drug approval? Where can more effective improvements be made
    to shorten the time between discovery and marketing?
        Ms. Woodcock. The scientific breakthroughs we are currently
    experiencing with targeted therapy or personalized medicine or
    whatever, and I don't have time to go into it here, are giving
    us new opportunities to have new development pathways. We have
    been giving very significant thought to that, and I think we
    will be coming forth with some new development pathways that
    can help speed these medicines along and get them to patients
    sooner.
        This doesn't involve FDA review, because if we get a really
    good product into FDA, we can review it and get it on the
    market really quickly. What people are alluding to is the
    development time takes a long time. So we have some ideas about
    how to improve drug development for these highly effective
    therapies and we will be starting some efforts on that.
        Mr. Pallone. Mr. Chairman, could I just ask, I don't know
    if she does have something that she could follow up with on
    that, but if I could ask through you if there is more
    information, you could send us in writing about those new
    trends, I would appreciate it.
        Ms. Woodcock. I would be happy to do so.
        Mr. Pitts. If you would provide that to the committee.
        The chair recognizes the vice chairman, Dr. Burgess, for 5
    minutes of questions.
        Mr. Burgess. I thank the chairman for the recognition. Dr.
    Woodcock, thank you for being here again.
        Reference was made to the European Medicines Agency, that
    is, the FDA is actually more rapid. Now, would it be fair to
    say that the timeline is more predictable at the European
    medicines agency and the FDA?
        Ms. Woodcock. Our timelines are very predictable.
        Mr. Burgess. Does that include a timeline start to finish,
    or a timeline where you reset the clock because you have asked
    for new information or a different study to be done? Because
    this is the question that people come in with. I see people in
    my office literally every week with a drug or device who say
    that the FDA changes the rules of the game when we are deep
    into the process. I can't get any of them to come here and
    testify before this committee because they are frightened,
    quite frankly, of you and your agency. They are scared to speak
    up because they know that that could reset the clock once
    again.
        Is this a fair criticism that I am getting from people who
    have drugs and devices before your agency?
        Ms. Woodcock. As I said, we ought to start with the facts.
    The facts show that we are approving a very high percentage of
    priority drugs, an extremely high percentage on the first
    cycle. So that is a 6-month review, all right, generally
    speaking. And so that is a very predictable review.
        The second issue you are raising is do we change the
    standards? Sometimes as we learn about side effects of drugs as
    they are on the market and we gain more information, then we do
    need to ask companies that have additional drugs in that class
    or whatever to look for those side effects and study them
    before marketing. So that does happen sometimes.
        Mr. Burgess. It is not just sometimes. It seems like it
    happens all the time. Now, I have to be careful not to confuse
    drugs and devices, but let me talk about devices for just a
    moment.
        I met a physician out in West Texas who developed a method
    for conscious sedation that was much more safe than anything
    that he had used in his practice as an anesthesiologist. It
    came to him while he was watching his newborn son being
    circumcised. And while it turns out that this device would not
    help in newborn circumcision, there are many other clinical
    applications where it would be very efficacious. As he told me
    this story, he said, just to put it in context for you, I
    developed this as a consequence of my son being a newborn and
    undergoing this procedure. And he is going to college this
    weekend, we are packing the car up to take him to wherever, and
    the device is no closer to being approved than it was 17 years
    before.
        Now, this individual no longer had a financial interest. It
    was simply because it was his baby literally, his idea that he
    wanted to see come to fruition and help patients. He sold it to
    a large medical manufacturing entity. But this thing was still
    bogged down in the process, and it was months and years of FDA
    advisory panels and this sort of thing. Even when they got
    clean bills by the advisory panel, then for some reason, the
    FDA would overrule and send them back to the starting point.
        He is not alone. There are other device manufacturers in my
    office, again, literally every week, and probably because this
    hearing is being televised, I will hear from a lot more of them
    now. But can you address that? We talked about the devices that
    are being off-shored because the environment is more friendly
    in other locations. You admit that other countries are actively
    recruiting our innovators. Are you working on that?
        Ms. Woodcock. Certainly. The reason that drug companies are
    going offshore has to do with the cost of either manufacturing
    or the cost of doing clinical trials. They are still submitting
    drugs to the U.S., because we are a large market. And as you
    see, we get drugs on the market before any other country in the
    world most frequently.
        As far as----
        Mr. Burgess. I am going to run out of time, so let me go
    back to what you were talking about initially where you said
    your time line, that you are good, you are meeting your
    performance goals. There is a study from the California Health
    Care Institute where they talk about the FDA not meeting its
    goals and that your times have slipped since the last PDUFA
    reauthorization in 2007. Can you address that for us?
        Ms. Woodcock. Certainly. In the year or so after the
    passage of the Amendments Act, we were given a very large
    assignment of work by Congress in the Amendments Act which had
    many, many activities that we had to do. We made that our
    priority and accomplished those activities that we were
    directed to do by Congress.
        During that time, our goals did slip slightly and we failed
    to meet some of our goals, although we still had a very high
    performance. That situation has been rectified and we are now
    meeting and exceeding our user fee goals again.
        Mr. Burgess. According to this study, you have slipped 28
    percent. It is fair to say the Democrats' last reauthorization
    slowed you down. Let's hope this reauthorization doesn't
    perform similarly.
        Thank you, Mr. Chairman. I will yield back.
        Mr. Pitts. The chair thanks the question and recognizes the
    gentleman Mr. Gonzales for 5 minutes for questions.
        Mr. Gonzalez. Thank you very much, Mr. Chairman, and
    welcome, Doctor. Quickly following up on Dr. Burgess' question,
    it is very interesting, because I think there has been some
    comments that we are losing jobs and such and investment in the
    United States because pharmaceutical companies want to do
    things outside of the United States, and the reason for that is
    the slow, cumbersome regulatory system that the FDA presents.
        Your response was that is not necessarily true. If cost is
    cheaper in another country, whether it is manufacturing or
    research and development, that is where the investment may be
    made, and it is strictly more on finances than anything else,
    eventually that particular company, whatever it manufactures,
    whatever it presents for consideration, is still going to come
    through FDA, that is right, and the reason, and you cited it,
    is that this is an incredibly lucrative market for
    pharmaceuticals, the United States of America.
        Would you say that in the United States of America, maybe
    there is a greater profit margin for pharmaceuticals than in
    other countries?
        Ms. Woodcock. I am not really qualified to comment on that.
    I am a doctor, not an economist. Sorry.
        Mr. Gonzalez. Do you know of any literature that might
    support the proposition that because of the system that we have
    in the United States, we may well be paying more for a certain
    drug, the same drug that is available here in the United States
    as well as in other countries?
        Ms. Woodcock. Yes, I am certainly aware of that.
        Mr. Gonzalez. How is FDA approval viewed? And I guess you
    can congratulate yourself because I assume it is very
    favorable, how is FDA approval viewed worldwide in other
    markets in other countries?
        Ms. Woodcock. Well, FDA has generally been viewed as say
    one of the gold standards. We provide a scientific and
    technical and highly unbiased review, and we base it on the
    evidence. We are really the only place in the world that goes
    down to the patient level data, and we get that data in and
    review it. So we are confident when we make a decision that is
    based on the actual evidence that has been generated. Many
    countries in the world look to FDA, all of our standards, our
    standards for manufacturing, our standards for clinical trials
    and so forth. But we have made a lot of efforts to harmonize
    those internationally through various arrangements that have
    been made.
        Mr. Gonzalez. Let's just say that there was just total
    reciprocity and you could sell a drug that was manufactured and
    approved by another country, this is a make-believe world. In
    your position, of all the countries, which regulatory agency
    regarding drug approval would you depend on before you would
    prescribe that drug for a patient? I know you are from the FDA
    and this may be quite an obvious answer. But seriously, if you
    were a physician in another country, wouldn't it be FDA, the
    United States of America?
        Ms. Woodcock. Well, I certainly have spoken to many
    physicians and many regulators around the world, and our
    process is viewed as a very robust and excellent process that
    people look up to as a gold standard.
        Mr. Gonzalez. We want you to do things timely, we want you
    to do it efficiently for all the right reasons, but not at the
    cost of quality and safety. That is the only point I think all
    of us would agree on.
        How do other countries finance their regulatory--let's say
    their FDA, their equivalent of FDA?
        Ms. Woodcock. In Europe, there are user fees. It is not the
    same arrangement because the countries give scientific experts
    to the process and there are multiple countries involved in the
    EU. There are different arrangements around the world. Many of
    them involve user fees of one type or another. Many countries
    do not have the personnel, scientific personnel and resources,
    to mount a kind of review that we do, so they rely upon
    conclusions from the World Health Organization, from the FDA,
    and from others.
        Mr. Gonzalez. I guess my final question, I have 30 seconds,
    and that is, we have been referencing what FDA means in the
    United States and such. We do not defer to other governmental
    regulatory agencies in other countries for the safety of our
    pharmaceuticals, is that correct?
        Ms. Woodcock. That is correct.
        Mr. Gonzalez. Thank you. I yield back.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the gentleman Mr. Shimkus for 5 minutes for questions.
        Mr. Shimkus. Thank you, Mr. Chairman.
        Dr. Woodcock, thank you. You are not an economist, and
    although we have a lot of physicians on the committee, most of
    us are not, so you are in good company here.
        From your opening testimony, the words I caught on to was
    the drug lag, R&D, investment, fewer drugs because of that. We
    are going to have a venture capitalist, I think, on the second
    panel, an investor, talking about, and that is where we are
    trying to marry how do we keep capital going into this.
        I don't mind talking about the great job creating aspects
    of a thriving pharmaceutical industry that is putting safe and
    efficacious drugs out on the market. At a time when we are
    looking for job growth, that sector can do that, the
    telecommunications sector can do that, the energy sector can do
    that. But as my friend Charlie Gonzales was talking about, we
    still want it safe, and that is a big criteria. Globalization
    does play a big role, another word in your opening testimony.
        So it is in these concerns that we--the issue of our
    European competitors, who have some quality standards, may be
    starting to close that gap, plus Asian producers who may be
    closing that gap. But we have had concerns about what we
    receive there. This committee has had numerous testimony on
    stuff, not just on pharmaceuticals, but also, just food
    products and stuff that has been of great concern.
        Some of us have been focused on the antibiotics issue,
    which I would like to turn to a little bit, bacterial
    resistance to antibiotics, which I know is a concern to you
    all. Part of your guidance there was some concern that your
    agency was not giving adequate guidance for clinical trial
    design for new antibiotics, especially in the case where no
    treatment existed for a given infection.
        Can you discuss what progress the FDA has made in this area
    since you last testified?
        Ms. Woodcock. Certainly. We have been working with the
    foundation for NIH that convened a group that is working on
    endpoints for clinical trials for different classes of
    antibiotics. I think this is very promising. We also have been
    having discussions about basically untreatable infectious
    diseases, multiple drug-resistant infections and how one would
    do trials, and we do hope to get out some guidance on that.
        We don't know either, all right? This is unchartered
    territory. So we can put our best ideas forth, but we don't
    have all the answers about how to study these. I think we will
    show considerable flexibility in the standards that we apply
    when we are talking about diseases, infectious diseases that
    really lack any alternative treatment.
        Mr. Shimkus. Can you give me any thoughts on the need for
    new antibiotics to treat resistant infections?
        Ms. Woodcock. The bugs are always ahead of us, all right,
    and that is something we just have to live with, that the
    infectious organisms can mutate very rapidly. We give
    antibiotics out to a lot of people. We put the bugs under
    selective pressure, and bingo, we have resistant organisms that
    we can't treat very well.
        So this is an ongoing problem where we need a robust
    pipeline of new antibiotics, and to some extent, we need some
    effective antibiotics that we don't use very much, all right,
    that we hold in reserve for those types of situations, because
    if we use them broadly, then the bacteria become resistant.
        Mr. Shimkus. On a separate issue now, talking about the FDA
    advisory committee and situations in which an individual may be
    disqualified because they have worked on a clinical trial for
    an unrelated product, not a related product, and that is, I
    think, an issue--is that true? Do you know of cases where
    someone has been disqualified because they worked in a clinical
    trial for an unrelated product, and does that hurt in this
    clinical time lag that we are kind of debating today?
        Ms. Woodcock. Yes, it is true. It is also true we have
    difficulty recruiting qualified people and having highly
    qualified panels. In some cases, we have had to delay advisory
    committees because of the difficulty, because once we go
    through in great detail, all the financials of the individuals
    we have nominated, we find that they have to be excused from
    participating.
        Mr. Shimkus. Thank you, Mr. Chairman. Thank you, Dr.
    Woodcock.
        Mr. Pitts. I thank the gentleman and recognize the
    gentlelady from California, Ms. Capps, for 5 minutes for
    questions.
        Mrs. Capps. Thank you, Mr. Chairman.
        And thank you for your testimony, Dr. Woodcock.
        I would like to reiterate for a minute what others on the
    panel have been saying.
        The PDUFA program has largely been a successful and
    creative partnership, in my opinion. And I look forward to
    working with my colleagues on both sides of the aisle to
    strengthen the program during this reauthorization process.
    Moreover, I think a lot of what we have heard today reinforces
    the importance of giving the FDA the resources it needs to
    ensure that the agency can do its work independently and in a
    timely manner while ensuring patient safety.
        While the FDA's drug review process has a great number of
    strengths, I am concerned about reports that clinical trials
    data submitted to the FDA do not routinely include reporting
    based on sex or other important demographics. For example, one
    study found that, despite FDA regulatory requirements that
    require the reporting of a broad range of demographic data,
    more than one-third of the time this information is not being
    provided. In addition, a 2007 study specifically looking at
    heart disease clinical trials--and, of course, heart disease
    being the number-one killer of women--found that only 25
    percent of trials report sex-specific results in scientific
    journals.
        These issues were highlighted in a 2010 Institute of
    Medicine report entitled, ``Women's Health Research: Progress,
    Pitfalls, and Promise,'' which found that--and this is a quote
    from the report--``inadequate enforcement of recruitment of
    women and of reporting data by sex has fostered suboptimal
    analysis and reporting of data on women from clinical trials
    and other research.''
        Its recommendations included specific strategies for the
    agency. And another quote from them, which I am sure you know
    about: ``For medical products, drugs, devices, and biologics
    that are coming to the market, the FDA should enforce
    compliance with the requirement for sex-stratified analysis of
    the efficacy and safety and should take those analyses into
    account in regulatory decisions.''
        Unfortunately, as you know, there is a limited transparency
    with these applications, making it difficult for the public or
    prescribing physicians to know if any improvements on this data
    collection are being made. So my question is, can you discuss
    this work with us, please? What has FDA done to address the
    gaps in these data?
        Ms. Woodcock. Well, interestingly, when I started at the
    Center for Drugs in 1994 for the first time, I was instrumental
    in getting this regulation done that required reporting by sex,
    of how many women were in trials, you know, what the results
    were by sex and so forth.
        I don't know the answer to your question. I am going to
    have to get back to you. My impression was that we have
    standard tables on reporting by sex, both for outcomes as well
    as how many people were recruited in the trial and all the
    other variables. So I am very surprised to hear what you have
    to say, and we can get back to you on this.
        Mrs. Capps. Well, I do--I think this is really important. I
    want to make sure that--there are a number of diseases, not
    just heart disease, that have different symptoms for the
    different genders. And I am under the impression and this
    article would give--the Institute of Medicine report in 2010
    would indicate that there is limited transparency within that
    application process. So that it would be very difficult for the
    public, it would be difficult for FDA, and it would certainly
    be difficult and challenging for the medical provider to know
    if any improvements on the data collection are being made.
        And I look at the legislation I have introduced in this--
    that passed out of the House in the past, the HEART for Women
    bill, which specifically addresses this issue to ensure that
    these important data are being used to keep all Americans
    healthy.
        So if you have any final thoughts--this is a topic I want
    to see thoroughly explored by the Food and Drug Administration
    and a report submitted back to us on whatever findings that you
    have.
        Ms. Woodcock. I think part of the problem that we have in
    getting timely data on this and providing it is that we don't
    get all the information in a standardized electronic format. If
    we did that, we could easily run reports on these standard
    tables and we could tell everything there is to know about
    reporting by sex.
        In the new PDUFA recommendations that we are putting forth,
    there is a requirement that we get standardized all-electronic
    data. And this would extremely help transparency of this issue
    and many others.
        Mrs. Capps. Mr. Chairman, I think this is a really
    important topic.
        And I would like to request that we have follow-up data
    that you provide, FDA provides, to us on the progress that has
    been made and/or any other changes that should occur so that we
    can get this information.
        Ms. Woodcock. I would be happy to do so.
        Mrs. Capps. Thank you very much.
        And I yield back.
        Mr. Pitts. The chair thanks the gentlelady and recognizes
    the gentlelady, Ms. Myrick, for 5 minutes for questions.
        Mrs. Myrick. Thank you, Mr. Chairman.
        And thanks for being here and for your thoughtful comments
    today.
        My concern is about the FDA's ability to approve potential
    drugs to treat deadly diseases. For example, we know a drug
    like Avastin has toxicities that aren't well-tolerated by some
    patients, but for some patients, especially metastatic breast
    cancer patients, it does not extend their survival, but for
    others it does extend their survival. And metastatic breast
    cancer patients are facing a deadly disease, as we all know,
    and many are willing to take that toxicity risk if the drug
    helps keep them alive. I believe you said that in your
    testimony today.
        And so I applaud your efforts, you know, to promote the
    need for biomarkers and screening tests so that scientists and
    physicians have more certainty about which patients respond to
    certain particular treatments. But if we don't have the
    screening tests now, I don't think we should restrict access or
    pull approval for a drug simply because we are not sure how to
    define the category of patients who will respond.
        So why can't the FDA approve the drug with appropriate
    warnings for doctors and patients by informing the doctors that
    many of their patients might not respond and that there are
    risks involved, I mean, as an example?
        Ms. Woodcock. Well, I cannot comment on the Avastin
    situation very specifically. The Center for Drugs has made a
    recommendation, and now it is before the FDA commissioner. And
    we have had a hearing and so forth.
        Generally speaking, if we have found that a drug saves
    lives, then we will approve it, regardless of many serious side
    effects, as long as the survival advantage is not outweighed by
    mortality caused by drug side effects, OK?
        Mrs. Myrick. Yes.
        Ms. Woodcock. So we have many, many drugs--we have recently
    approved several cancer drugs----
        Mrs. Myrick. Right.
        Ms. Woodcock [continuing]. That are very toxic----
        Mrs. Myrick. Right.
        Ms. Woodcock [continuing]. All right? And people know, if
    they are going to take those drugs, they may be facing--they
    may die from the side effects. That is true of cancer
    treatment. But they are trying to extend their lives.
        Mrs. Myrick. Well, I know there are women who have taken
    this particular drug, Avastin, you know, for 3 or more years,
    and they are still doing well, so. I understand, it is just a
    little frustrating, because I know if you are in a position
    where you really have this disease and you want to do
    everything you can to extend your life.
        One more question on this same line. The FDA and the
    European Union's drug-approval body reviewed the same data on
    Avastin as a metastatic breast cancer treatment. And I
    understand it is approved there for HER2-negative metastatic
    breast cancer, and it is widely used in Europe for those
    patients.
        So what is the difference? How do you explain the
    difference between what they are doing and what we do? Because
    I know it is all global, and we look at all of it together.
        Ms. Woodcock. We do look at all the same data. We have
    certainly talked to the EU about their decisions. Sometimes we
    reach different decisions. We approved Avastin for a deadly
    brain cancer----
        Mrs. Myrick. Right.
        Ms. Woodcock [continuing]. Called ``glioblastoma'' that
    they did not approve Avastin for. So sometimes various experts
    come to different opinions.
        But I can assure you that we have--our breast cancer
    oncologists at FDA are dedicated to the treatment and,
    hopefully, eventual cure of breast cancer and getting the best
    possible agents out there for women.
        Mrs. Myrick. Oh, no, I don't have any question about that.
    I guess my question is more about the fact of how we restrict
    some of these when they do work for a large share of women,
    even though there is a mortality rate in allowing the usage for
    those women for those drugs.
        Ms. Woodcock. The trials that we looked at--and this is
    from the Center for Drugs, again, because it is up on appeal
    right now--but in the trials that were done of Avastin in
    breast cancer, there was no survival advantage at all. And
    there was also no----
        Mrs. Myrick. But--and I understand. But the point is, if it
    is helping some people and they are willing to take the risk, I
    guess I go back to the same thing, should we not allow them to
    have that opportunity? And that is really where I am coming
    from.
        Ms. Woodcock. I understand.
        Mrs. Myrick. I yield back, Mr. Chairman.
        Mr. Burgess. Would the gentlelady yield to me for a moment?
        Mrs. Myrick. Yes.
        Mr. Burgess. Just on that question on Avastin, just looking
    at the list of people who were on the advisory panel last week
    who rendered this opinion, I don't see anyone--maybe you can
    educate me differently--I don't see anyone that would have had
    the ongoing daily treatment of breast cancer patients under his
    or her control. You had a lot of experts and a lot of
    oncologists, but I didn't see a specific specialist in the
    specialty of metastatic breast cancer.
        Wouldn't you want someone like that on a panel rendering
    that type of opinion?
        Ms. Woodcock. Well, this was not run by the Center for
    Drugs, and so I can't comment. I agree, there was no breast
    cancer expert, to my knowledge, on that panel.
        Mr. Burgess. Thanks, Mr. Chairman.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the ranking member of the full committee, Mr. Waxman, for 5
    minutes for questions.
        Mr. Waxman. Thank you very much, Mr. Chairman.
        Ms. Woodcock, good to see you again.
        I mentioned in my opening statement that we want to ensure
    that innovation in the pharmaceutical industry is vibrant. This
    is an important national priority. I also think it is important
    to assure that the drugs that reach patients are both safe and
    effective. That is the mandate to FDA.
        When critics assert that FDA is somehow stifling
    innovation, we need to look very carefully behind those claims
    and insist that we have reliable and accurate data to
    substantiate them. Without this kind of data, we can very
    quickly get to a place where the so-called solutions are being
    proposed to a problem that may or may not exist in the first
    place.
        The same critics allege FDA's slowness is because of
    regulatory changes that I fear could prove--they are suggesting
    some of these regulatory changes--for instance, some have
    suggested that Congress pass legislation preventing FDA from
    having the ability to insist on critical trial data that FDA
    feels is necessary and force it to approve drugs on the basis
    of less information.
        Specifically, some have also suggested that the FDA be
    required to approve drugs for certain conditions on the basis
    of a single study instead of two randomized, placebo-controlled
    trials. In 1997, we did adopt a law that gave the FDA
    discretion to do less than two randomized trials, and then we
    hear critics claiming that FDA has not used this discretion,
    always insisting on two trials.
        Now, we are not scientists; we rely on you to make
    scientific decisions at the FDA. But we hear all the time about
    how FDA is taking too long and asking for information that is
    not necessary.
        Can you comment on this? Is it true that FDA has failed to
    use the discretion we gave you in PDMA and that the agency
    always insists on two trials? Would FDA be concerned about
    legislation that spelled out the number or type of clinical
    trials that the agency could look at in assessing a drug
    application?
        Ms. Woodcock. Well, first, let me say, I would be concerned
    about trying to legislate at a more detailed level what type of
    evidence is required. We try to match the evidence to the
    situation, the requirement of evidence to the situation. So for
    rare diseases or mortal diseases, less evidence usually is
    required.
        For example, we did a study of orphan data, and half of
    orphan approvals were based on a single trial, one trial.
    Recently, this year, we have approved seven orphan or rare
    disease indication, all right? Some new products, some efficacy
    supplements. For one of those, there was no human trial--it was
    done on animal data--to show efficacy, right? In one of them,
    there were 17 patients. And this was a rare disease. But there
    wasn't a randomized trial. We compared how the patients were
    doing before they took the drug compared to how they did after
    they took the drug.
        Mr. Waxman. So you use that discretion like you have under
    the law to set up priorities, how serious the disease is, how
    small the population may be that is being affected by a
    particular disease or would be helped by a particular drug. And
    you feel that if we micromanaged your activities by specifying
    that this trial is all that is needed or that trial is
    sufficient, that we would end up with, what, stultifying FDA or
    not letting you do your job?
        Ms. Woodcock. We might slow things down.
        Mr. Waxman. Slow them down even further?
        Ms. Woodcock. That is what I think, because we would be
    involving a lot of lawyers and whether we were obeying the law
    in medical decisions that we were making. Nothing against you
    lawyers, but sometimes that slows things down a little bit.
        I would say that we have considerable flexibility. And,
    say, a drug for headache pain that is going to be used by
    millions of people, all right, you want to know more about
    that--you want to know it is not going to cause a stroke, for
    example--than a drug here for the orphan indication or for a
    disease where people are dying and they don't have any other
    alternatives. We have great flexibility in the standards that
    we apply.
        Mr. Waxman. Has there been a change in FDA's protocols for
    reviewing drugs? In other words, has there been something
    where, according to Mr. Leff, who is going to testify in a
    while, that FDA has shifted to a more cautious decision-making
    posture, begun to require more and more data to provide a
    higher degree of statistical proof of both efficacy and safety?
    And it sounds like FDA has somehow formally changed the drug
    review process. Is that an accurate statement? How do you
    respond to that?
        Ms. Woodcock. No. I believe that we still have the
    standards of safety and effectiveness that we have always had,
    and we continue to apply them.
        We have learned, though--we have learned some things. For
    example, we have learned that drugs that raise blood pressure
    will cause a certain incidence of strokes. And so, for example,
    in obesity, if you are going to have a drug to treat obesity,
    maybe it causes weight loss, but if it raises the blood
    pressure--I mean, you are treating the obesity, in part, to
    decrease cardiovascular complications, OK?
        Mr. Waxman. Right.
        Ms. Woodcock. What if, in fact, you are actually going to
    increase them?
        So we have to know, because the standard is that it works,
    right? And patients take these drugs because they believe they
    are going to better their lives and better their health. And
    so, when we learn new medical facts, new scientific facts, we
    have to make sure that they are taken into account in the drug
    development program. But that is part of the standard of safety
    and effectiveness.
        Mr. Waxman. Thank you, Mr. Chairman.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the gentlelady, Ms. Blackburn, for 5 minutes for questions.
        Mrs. Blackburn. Thank you so much, Mr. Chairman.
        And we appreciate that you are here, Dr. Woodcock.
        I want to stay with the line of questioning that Ms. Myrick
    had started with you, looking at this approval process. I had
    gone through the forensic cancer research report on FDA and the
    EMA, European Medicines Agency, looking at those approvals from
    2003 to 2010. And, you know, that said, well, FDA was faster
    than EMA. But when you look at the year by year on that--and I
    am sure you have done that--and you go back to 2007 or 2008,
    there is a significant narrowing of the lag in cancer medicine
    approval times between the FDA and the EMA. And that was
    repeated--the noting of that lag was repeated in the California
    Healthcare Institute--and I know you are familiar with that
    report--and also the Boston Consulting Group report.
        So I want to ask you four questions relative to that,
    because I think this should be of great concern with us. And it
    ties into what we hear from our constituents, who are concerned
    about the process that you are having individuals go through,
    as they try to file and go through the approval process.
        So here are the four questions for you on that: Number one,
    what accounts for these trends? Number two, is the FDA getting
    slower and more inefficient? Number three, is the EMA getting
    better and more efficient? And, number four, is it a
    combination of things?
        Because if we are getting slower, we need to nip this in
    the bud and we need to know what the precise problem is. Can
    you define that?
        Ms. Woodcock. Well, I can't remember each one of your four
    questions----
        Mrs. Blackburn. I will be happy to submit for writing.
        Ms. Woodcock. Right.
        The FDA most recently--our most recent data for 2011 show
    that we have the highest first-action approval rate we have
    ever had, which means the applications are coming in and they
    are getting out the door on the first cycle. And that, for
    priority applications, is 6 months usually. All right? So you
    can't get too much faster than that, all right?
        The Europeans may be getting faster. Another hypothesis or
    thought is that the applications are getting better, all right?
    If the industry fully understands what the regulators want and
    they have a very important drug that is needed by the
    population, then it usually will move through the regulatory
    process in any country very rapidly.
        So we don't feel we are in competition with the European
    Union or whatever. We were simply responding to criticism that
    it was taking us twice as long or three times as long as they.
    If the drug were approved simultaneously around the world and
    available to all patients with whatever disease, say, hepatitis
    C, that would probably be the best outcome.
        Mrs. Blackburn. Well, and I agree with you on that. And I
    think that the two things that we hear you could kind of
    distill down to companies that are spending billions of
    dollars, want to make certain that they are provided with both
    transparency and consistency in that FDA review process. And
    they want to make certain that you all are conducting these
    with certainty and predictability. And as you well know, that
    has been a problem.
        One other question I wanted to ask you about, because I
    have written you about the PGAs and the issue that is there.
    And I was due a response--I am trying to find it--by the end of
    June, and I still have not had a response from you all about
    the products that are there, with the PGAs and what you are
    doing with those over-the-counter, unapproved, PGA-containing
    eyelash growth products.
        What are you doing to investigate the marketing of those
    products and to restrict those in the marketplace? And do you
    plan to take enforcement action against all companies marketing
    these companies without FDA approval?
        I think that all of us who look at the market for young
    women, we are very concerned about these products in the
    marketplace.
        Ms. Woodcock. Yes, we are looking into this issue. As you
    know, there are numerous products in the marketplace, dietary
    supplements, that have been contaminated with many dangerous
    drugs. And so we have been taking action on products that are
    contaminated with these drugs. And we are looking into this
    issue, and we will be happy to get back to you on our progress.
        Mrs. Blackburn. OK. I am speaking specifically of the
    eyelash----
        Ms. Woodcock. I know.
        Mrs. Blackburn [continuing]. Growth.
        Ms. Woodcock. I know.
        Mrs. Blackburn. OK. Well, we were due a response by the end
    of June.
        Ms. Woodcock. Yes, I am sorry that you have not received
    that in a timely manner.
        Mrs. Blackburn. OK. And I think that we want to know that
    there is action taken against these unapproved----
        Ms. Woodcock. Yes.
        Mrs. Blackburn [continuing]. Products. Thank you.
        I yield back.
        Mr. Pitts. The chair thanks the gentlelady, recognizes the
    gentleman, Mr. Engel, for 5 minutes for questions.
        Mr. Engel. Thank you, Mr. Chairman. I want to thank you for
    holding this important hearing today. As we all know, the
    reauthorization of PDUFA is vitally important to both patients
    and industry alike.
        As many of us remember, PDUFA was originally enacted in
    1992 to address the unusually long and unpredictable wait
    period that it used to take for new drugs to be approved for
    market consumption. At that time, it would take an average of
    more than 2 years for a new drug to be approved, which meant
    that patients would not have access to new medicines when they
    needed them, and innovation suffered.
        I am proud to say that, since then, we have come a long way
    in making more drugs available to patients while maintaining
    safety. I recognize that the system is not perfect, but we have
    come a long way.
        Mr. Chairman, as we move along in the reauthorization
    process, I look forward to working with the various
    stakeholders and my colleagues on the other side of the aisle
    to address ways in which Congress can strengthen the FDA and
    achieve our common goals. I mention working with my colleagues
    on the other side of the aisle because I think it is very
    important that we remember that this is not a partisan issue.
        However, the appropriations bill that was passed last month
    cut the FDA's funding drastically, and I think that was a
    mistake. How can we expect the FDA to do their job effectively
    and efficiently while at the same time take away the valuable
    resources they need to do it? This only hurts patient safety,
    and it also hurts one of our strongest and most innovative
    industries.
        So, Dr. Woodcock, let me ask you this. Today we are
    discussing legislation that authorizes prescription-drug user
    fees, which are critical to the FDA's ability to approve drugs
    more quickly while at the same time the House is cutting the
    funding. Can you tell me how you plan to reconcile these cuts
    and see that new, innovative drugs continue to come into the
    market in a timely manner?
        Ms. Woodcock. Well, I mean, any cuts would make various
    programs at FDA more difficult. We also approve generic drugs,
    and the flow of those is important to keeping health-care costs
    under control in the United States. And we would become more
    challenged, I think, in our review of generic drugs if we had
    substantial cuts. We also manage post-market drug safety
    problems, and that requires a considerable amount of resources
    and effort.
        We also keep guard over quality of all the drugs in the
    United States. And, as has already been mentioned, the import
    of drugs from all around the world and manufacture around the
    world have challenged us to make sure that we are able to
    ensure high quality of the U.S. drug supply. So that would be a
    challenge. Also, clinical trials are conducted all around the
    world, and so we are having to inspect those clinical trials
    wherever they might be held.
        In addition, as you alluded to, this would have an impact
    on our ability to promote innovation in new drug regulation and
    in drug development, which is something that is very dear to my
    heart.
        Mr. Engel. Let me ask you--as you know, many doctors and
    hospitals are struggling to cope with unprecedented drug
    shortages in the United States. Drug shortages obviously lead
    to delays in treatment and force the use of alternative drugs,
    which can result in unintended consequences. This shortage is
    endangering cancer patients, heart-attack victims, accident
    survivors, and many other ill people.
        So let me ask you this. Before I ask you this, I want to
    ask the chairman for unanimous consent to put into the record a
    statement from the American Hospital Association on behalf of
    our hearing today.
        Mr. Pitts. Without objection, so ordered.
        Mr. Engel. OK, thank you. Thank you, Mr. Chairman.
        [The information follows:]

        [GRAPHIC] [TIFF OMITTED] T2917.031

        [GRAPHIC] [TIFF OMITTED] T2917.032

        [GRAPHIC] [TIFF OMITTED] T2917.033

        Mr. Engel. So let me ask you this, Doctor. From the FDA's
    perspective, what is the problem with drug shortages, and how
    can we address it?
        Ms. Woodcock. Drug shortages have multifactorial problems,
    all right? They are related, often, to drugs that are off-
    patent, that only have one manufacturer that is approved in the
    United States, and that eventually have aging facilities.
        We work tirelessly to try and ameliorate drug shortages in
    the United States. And, from our point of view, although there
    are these structural problems, what would help us the most
    would be to have early notification if a company is planning to
    stop making an essential drug or temporarily go out of
    production, so that we could make arrangements to substitute
    something else, to get another drug available for doctors and
    patients. And we have been able to do that many times when we
    have actually had advanced notice.
        Mr. Engel. Let me ask you--the final question is, you
    mentioned in your testimony that the FDA allows access to
    investigational products through clinical trials. And this
    allows patients who may need a treatment that is not currently
    on the market to access innovative treatments. You mentioned
    also in your testimony that are times when patients cannot
    enroll in critical trials.
        Could you explain why and what some of the challenges are
    that these patients face when considering the clinical trial?
        Ms. Woodcock. Well, there is difficulty in the U.S. in
    accessing clinical trials. But there is a broader issue of
    treatment access, which is a person who lacks alternative
    therapy and there is no other approved drug that might work for
    them, so they would like to access an investigational product--
    drug.
        We recently passed regulations about a year ago that
    broadened and liberalized and rationalized access protocols for
    investigational drugs. The FDA believes that people with
    serious illnesses who lack alternative therapy should be able
    to get investigational drugs on a treatment basis.
        Mr. Engel. Thank you, Mr. Chairman.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the gentleman from Georgia, Dr. Gingrey, for 5 minutes.
        Mr. Gingrey. Mr. Chairman, thank you.
        And, Dr. Woodcock, thank you very much for your testimony.
        Let me ask you a couple of quickies. Did you tell the
    committee that your specialty is rheumatology?
        Ms. Woodcock. Yes.
        Mr. Gingrey. OK, thank you.
        In regard to my colleague from North Carolina, in regard to
    the question on Avastin, can you assure the committee the
    decision on Avastin--and I guess that final decision is in the
    hands of the commissioner at this point; it looks like it
    probably will not be approved for advanced breast cancer,
    although it will continue to be approved for colon, and you
    mentioned a type of brain cancer that it is still approved
    for--this decision, can you assure us, is not based on the cost
    of that drug?
        Ms. Woodcock. We never look at the cost of drugs when we
    are doing our decisions. It is not within our mandate, and it
    is not something that we look at.
        Mr. Gingrey. You never look at the cost of the drug?
        Ms. Woodcock. No.
        Mr. Gingrey. OK.
        Mr. Shimkus brought up a question about the need for new
    antibiotics, and I think that your response to his questions
    was reassuring to me. And I think you probably know that Mr.
    Shimkus and myself and others on this committee, in a very
    bipartisan way, have introduced H.R. 2182, the GAIN Act, to try
    to get more antibiotics to the market and the problems that we
    have in regard to that, because if they are used properly, then
    the market for the sales of those drugs is very limited----
        Ms. Woodcock. Right.
        Mr. Gingrey [continuing]. As it should be, if they are used
    properly.
        Can you also give me your thoughts on the need for new
    diagnostics to properly identify infectious diseases? For
    example, would new diagnostics have helped in the recent E.
    coli outbreak in Germany?
        Ms. Woodcock. Certainly. We feel that, particularly, point-
    of-care diagnostics that could be used at the bedside by
    clinicians to rapidly identify the bacteria and also
    potentially resistance profiles would be just an outstanding
    advance in infectious disease. And we have certainly talked to
    the Infectious Disease Society about this and others.
        So if we could target our antibiotics better--as you well
    know as a clinician, we do a--whatever you call it--a shotgun
    approach to treatment until we have the cultures and we know
    what the patient has. And so, for many days or maybe total
    course of treatment, it may be empirical, and so we don't know
    what we are treating. And this leads to a more widespread
    resistance, I believe.
        Mr. Gingrey. And that, of course, is part of our bill, as
    well. And I thank you for that response.
        Very quickly, my last point, I wanted to address the
    Sentinel Initiative, the post-market risk identification/
    analysis system.
        And the reason I wanted to be sure of your specialty of
    rheumatology, there is a drug--I think it is pronounced
    ``Remicade.'' Am I correct?
        Ms. Woodcock. Yes, uh-huh.
        Mr. Gingrey. --Remicade, that was approved. And I wanted to
    ask you, if you know, was that approved under orphan drug
    status? I know it has been on the market maybe for as much as
    20 years--well, maybe not quite that long. But the drug being
    used for Crohn's disease and with pretty good results. But my
    understanding is that up to 5 percent of individuals will
    eventually, if they have taken that drug for Crohn's disease,
    they will eventually come down with leukemia. And, you know, to
    me, that seems awfully high. And maybe I am being affected
    because it happened to a family member just recently, who ended
    up dying of her leukemia. She was helped tremendously several
    years ago by use of this drug.
        What is the threshold? A 5 percent, to me, risk from taking
    a drug and then ultimately developing leukemia, which is pretty
    life-threatening--in her case, it was definitely life-
    threatening and life-ending--where is the threshold in regard
    to what we are looking at in the Sentinel Initiative, the post-
    market analysis of these drugs?
        Ms. Woodcock. Well, generally what we are doing with all
    the immunosuppressant drugs is having registries and long-term
    follow-up. So we can also use Sentinel for evaluating these
    longer-term outcomes. But we are also watching patients
    observationally over time.
        And we can get back to you on what we know right now about
    the occurrence of malignancies as well as infections,
    opportunistic infections, as a result of all the classes of
    immunosuppressive drugs that are used.
        Mr. Gingrey. Dr. Woodcock, I would really appreciate that,
    both as a Member of Congress and personally. I would really
    appreciate you getting back to me with a report on that. And I
    thank you very much.
        Ms. Woodcock. I would be happy to do that.
        Mr. Gingrey. I yield back.
        Ms. Woodcock. And if I may say one thing about this, this
    really illustrates the balance of benefit and risk, because
    malignancies are not apparent immediately, all right? And so,
    you could say, well, this is a wonderful drug, we should just
    get it out there, and everyone should take it. But what we find
    out is, yes, there are breakthrough--tuberculosis, whatever,
    and there are also cancers that occur late. And this is where
    we have an obligation to patients to find out as much as we
    possibly can, so they can make their decision.
        Mr. Gingrey. Thank you.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the gentleman, Mr. Latta, for 5 minutes for questions.
        Mr. Latta. Well, Doctor and Director, thanks very much for
    being with us today. I really appreciate your testimony today.
        And just to kind of maybe follow up a little bit of the
    questioning that has already been asked, but one of the areas
    that I would like to go into is about especially on the obesity
    and diabetes side, with the drugs out there and the therapies
    that are being brought forth, and especially with the FDA
    approval process. Because, as we all know, especially young and
    old alike, both these, diabetes and obesity, are affecting a
    huge portion of our population and increasing our costs.
    Especially, it is a huge driver on the Medicare side.
        And the question is, what are you doing to encourage the
    development of new therapies to treat these diseases,
    especially using your authority under REMS----
        Ms. Woodcock. Pardon me. I am having trouble hearing you.
        Mr. Latta. OK. You know, this is sometimes also the room
    that we use for our telecommunications subcommittee. And I am
    sorry--is that better?
        Ms. Woodcock. Yes.
        Mr. Latta. OK. The way some of our mikes pick up.
        But the question I have then is, what are you doing
    encourage the development of new therapies to treat these
    diseases, especially using your authority under REMS to follow
    the drugs closely after their approval?
        Ms. Woodcock. We share the understanding of the need for
    new treatments for diabetes and for obesity. And I would point
    out that for diabetes, in early 1990s, there were only two
    types of therapies available for the treatment of Type 2
    diabetes, and now we have 11 new classes of drugs that are out
    there. So there has been a tremendous blossoming of attempts to
    get new therapies for diabetes out there.
        And, in fact, we are seeing the pipeline continue. And we
    have put out guidance about cardiovascular risk in diabetes
    drugs that companies have been able to deal with and follow,
    and we have approved new diabetes drugs recently. So we see a
    robust pipeline there.
        In obesity, the problem is different. We have had to take
    three obesity drugs off the market because they cause stroke.
    We have had to take another class of obesity drugs off the
    market because of heart-valve disease. And you can see with
    young people, if we expose them to an agent widespread that
    causes heart-valve disease, we would have another epidemic on
    our hands. So we must make sure that these products have
    adequate safety.
        But we recognize the obesity epidemic. And what we are
    doing is we are going to have a scientific meeting about
    obesity and cardiovascular safety. And we are also planning to
    have a series of stakeholder meetings, where we bring in the
    very attritions and the patient groups and the FDA and other
    experts to talk about how diabetes drugs should be developed.
    And I think this will be very helpful to the industry.
        Mr. Latta. Let me ask this. I think you said that you took
    several off the market last year. I believe also, if my
    information is correct, that the FDA also denied three
    consecutive applications for approval of new obesity drugs last
    year.
        Ms. Woodcock. That is correct.
        Mr. Latta. Now, was that for the same reasons, or what was
    the cause of that?
        Ms. Woodcock. Different--well, one drug had a blood-
    pressure problem, which was the reason we had to remove other
    diabetes drugs off of the market. They were causing strokes.
    Last year, we removed a drug, Meridia, from the market because
    of stroke. A trial was done that showed that even though people
    lost weight, they still got an increased number of strokes when
    they took this weight-loss drug. So it was removed from the
    market.
        So one of the problems that we are identifying is many of
    the weight-loss drugs increase blood pressure, and we have to
    make sure they are not causing an excess of strokes, OK? But
    some of the other weight-loss drugs have other types of
    problems that we are looking at.
        Mr. Latta. Thank you very much.
        And, Mr. Chairman, I yield back.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the gentleman from Kentucky, Mr. Guthrie, for 5 minutes for
    questions.
        Mr. Guthrie. Thank you, Mr. Chairman.
        Thank you, Dr. Woodcock.
        I know you all have a difficult job anytime you approve a
    drug as you go forward. And just think about the long term as
    you move forward, of course there is a--so it is a quandary.
    But there are a lot of people waiting on the approvals as you
    move forward.
        And my friend, Ms. Myrick, Representative Myrick, covered
    some of it, but I just got a text this morning from my brother,
    and I am going to share this a little bit. Well, first, my
    brother called me yesterday. He has a best friend in the Navy,
    was in the Navy, whose wife had breast cancer. And they were
    one of the ones who flew from Seattle, Washington, to, I guess,
    Baltimore a couple of weeks ago. And the text says, ``Thanks
    for talking to Nancy yesterday. She knew we were having this
    meeting. They are great people, and thanks for the quick
    response. The bottom line is, they have been through a lot, and
    she has lived much longer than she was supposed to.'' And I
    really read that to give you that line.
        And it seemed like with Avastin that--I talked with her
    quite a while on the phone yesterday, and she said her mother
    has breast cancer but very localized. And she realizes Avastin
    wouldn't be something that her mother should be taking. But she
    did say, when she discovered she had breast cancer, when they
    found the breast cancer, she had four tumors on her liver. I
    think that is what she said. And so, therefore, it looked like
    she had made the decision. She realizes the toxicity, but she
    really believes that Avastin is--and she is distraught--has
    really increased her life expectancy.
        So the question--and maybe this wasn't your area, as you
    said--was Avastin not approved for breast cancer because of the
    side effects or because there is no clinical proof that it
    actually works?
        Ms. Woodcock. Avastin was approved under accelerated
    approval for breast cancer. It was already on the market for
    other cancers, all right?
        Mr. Guthrie. Right, right.
        Ms. Woodcock. And then, subsequently, it was approved under
    accelerated approval.
        What that means is, then the drug developers have to prove
    that the promise, OK, that was approved under accelerated
    approval is real, all right? And so the company did additional
    trials, and they did not show any survival advantage.
        The original trial it got approved on showed something
    called progression-free survival. What that means is you live
    longer with your tumors not growing on scans.
        Mr. Guthrie. OK.
        Ms. Woodcock. All right? It doesn't mean you live longer.
    It means that your tumors are stable longer. And so the
    original trial showed, in women getting Avastin, their tumors
    stayed stable longer, all right?
        Mr. Guthrie. OK.
        Ms. Woodcock. What we asked the company to say--well, show
    that means something, show that translates to either quality of
    life, better quality of life of the people or longer life of
    people, all right? And they were not able to show either of
    those in the subsequent trials that were done.
        That does not mean that Avastin is not an active drug,
    perhaps, for some women, but we do not know what women. And it
    does have very serious, potentially fatal side effects.
        Mr. Guthrie. Right. She recognized that. We had talked on
    the phone--and so the issue really wasn't just the side effects
    and it could be fatal. But you are saying it really didn't show
    that it extended the life as you move forward.
        Ms. Woodcock. It did not. In that population. And that is
    not a population that is selected by some marker to respond
    well to Avastin. It may well be if they could come up with a
    biomarker and say, ``These women are the women who should take
    this drug,'' then it might be possible to figure out who the
    drug is good for.
        Mr. Guthrie. Uh-huh. So it could be a--and she could be
    one----
        Ms. Woodcock. That is right.
        Mr. Guthrie [continuing]. A select group of circumstances
    that it affects--because drugs interact with all of us
    differently--that would actually--and I know from our
    conversations she is convinced that she is still here because
    she was on Avastin.
        And one other thing a lot of people have said--I only have
    about a minute, so I will just ask it really quick. You know, I
    do hear from a lot of our people in the drug field,
    pharmaceutical field, saying that they are having difficulty
    getting things approved. You have heard that from several of us
    here. You all must be hearing the same thing. And maybe what
    you are saying is 2011 has been better than 2010 and 2009 and
    2007.
        So are you already acting to the fact that people said they
    are getting things difficult--like you said, 2011 has been
    pretty successful, but I am really not hearing people saying
    that, ``We have had difficulty in the past, but it seems to be
    getting better.'' So I don't know if you are hearing the same
    thing. And just comment on that. I have about 40 seconds left.
        Ms. Woodcock. Well, I would propose to you that the people
    who come into your office are not the people who have had a
    successful experience. And so you have what we call a biased
    sample, all right? And even if, like, 90 percent of the people
    are getting through and we are having a tremendous--I am not
    saying all this will continue, but this year we are having an
    extremely high approval rate because the drugs that are coming
    in are--many of them are very significant advances, all right?
        But the people I think who come to talk to you continue to
    be the people who are having a difficult time. And so I don't
    know that you would see any change in your experience.
        Mr. Guthrie. So they are not coming by to see us just to
    say, ``Thanks, it really went well''? We hear that sometimes
    too.
        Thanks a lot.
        Ms. Woodcock. Thank you.
        Mr. Pitts. The chair thanks the gentleman, recognizes the
    ranking member emeritus of the committee, Mr. Dingell, for 5
    minutes.
        Mr. Dingell. Mr. Chairman, I thank you for the hearing.
        And I thank you for your courage.
        Ms. Woodcock. Thank you.
        Mr. Dingell. I wanted to ask a ``yes'' or ``no'' question.
    I hope you will respond.
        Do you have the ability to fully control the safety of
    imported pharmaceuticals, yes or no?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have the authority to control the
    safety of raw materials or imported pharmaceuticals?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have the authority and the resources
    you need to address the safety of components now being imported
    into this country, yes or no?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have the necessary authorities and
    resources to see to it that drugs are only imported from
    facilities overseas that are properly observing good
    manufacturing practices--that is a word of art--yes or no?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have the ability to see to it that raw-
    materials suppliers also engage in good manufacturing practices
    abroad?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have the resources needed to conduct
    foreign drug-facility inspections with the same frequency as
    domestic drug-facility inspections?
        Ms. Woodcock. No.
        Mr. Dingell. How often can you get by to see a foreign drug
    manufacturer?
        Ms. Woodcock. Every 9 years or so.
        Mr. Dingell. Every 9 years?
        Ms. Woodcock. Yes.
        Mr. Dingell. You get by to see dog-food manufacturers every
    year or so.
        Ms. Woodcock. Yes, probably a little more--a little over a
    year.
        Mr. Dingell. Do you need additional resources to increase
    inspections of foreign drug facilities?
        Ms. Woodcock. Yes.
        Mr. Dingell. Do you need additional authorities to be
    effective in that?
        Ms. Woodcock. Absolutely.
        Mr. Dingell. Do you have the ability to freely share
    information about a drug with your trusted domestic and foreign
    counterparts in the instance of something like another heparin
    crisis, yes or no?
        Ms. Woodcock. No.
        Mr. Dingell. Do you need this ability?
        Ms. Woodcock. Yes.
        Mr. Dingell. Do you have a clear authority to require
    manufacturers to assure the safety of their food chain, yes or
    no?
        Ms. Woodcock. Their food chain?
        Mr. Dingell. Yes--I am sorry, the supply chain. I
    apologize.
        Ms. Woodcock. Thank you. No, we do not.
        Mr. Dingell. Do you need this authority?
        Ms. Woodcock. Yes.
        Mr. Dingell. Do you have the authority to require
    manufacturers to notify you if they suspect their drug may have
    been counterfeited, misbranded, or adulterated?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have the ability to properly assure the
    safety of both raw materials for the manufacture of
    pharmaceuticals and pharmaceuticals as they are imported into
    this country?
        Ms. Woodcock. No. And I think we are one of the few
    countries that does not have that authority.
        Mr. Dingell. Do you need this authority?
        Ms. Woodcock. Yes.
        Mr. Dingell. Do you have the authority to require companies
    to recall a drug, yes or no?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have that authority with regard to
    imports?
        Ms. Woodcock. No.
        Mr. Dingell. Do you have that authority with regard to raw
    materials and things like that?
        Ms. Woodcock. No.
        Mr. Dingell. And components?
        Ms. Woodcock. No.
        Mr. Dingell. Now, let's go to the question of heparin. A
    lot of bad heparin got out because, currently, you couldn't get
    over to China to see what the raw material was like and what
    was safe or unsafe with it. Is that right?
        Ms. Woodcock. That was part of the problem.
        Mr. Dingell. What was the other part?
        Ms. Woodcock. I think the tests were out of date for
    heparin.
        Mr. Dingell. The what?
        Ms. Woodcock. The testing standards, the U.S. standards,
    international standards.
        Mr. Dingell. Were they adequate or inadequate?
        Ms. Woodcock. They were inadequate.
        Mr. Dingell. OK. Do you have authority to address that
    problem?
        Ms. Woodcock. No, not fully.
        Mr. Dingell. Not fully or just not at all? If you can't do
    it fully, you can't do it at all, can you?
        Ms. Woodcock. Can you repeat the question?
        Mr. Dingell. Would you submit a brief monograph to this
    committee for the purposes of the record----
        Ms. Woodcock. Certainly.
        Mr. Dingell [continuing]. Explaining what happened in the
    heparin case and what abilities you need to address imports not
    just of finished products, pharmaceuticals, but also raw
    materials and components, please?
        Ms. Woodcock. We would be happy to do that.
        Mr. Dingell. Thank you.
        I ask unanimous consent that the additional matters
    requested be inserted in the record at the appropriate point,
    Mr. Chairman.
        Mr. Pitts. Without objection, so ordered.
        [The information appears at the conclusion of the hearing.]
        Mr. Dingell. Mr. Chairman, I thank you for your courtesy.
        And I thank our witnesses.
        Mr. Pitts. The chair thanks the gentleman, recognizes the
    gentleman from New Jersey, Mr. Lance, for 5 minutes for
    questions.
        Mr. Lance. Thank you, Mr. Chairman.
        Good morning, Doctor.
        I have the honor of being the Republican co-chair of the
    Rare Disease Caucus. And I want to thank the progress that the
    FDA has made regarding the advancement of orphan product
    development. And given the fact that a large number of products
    approved by the agency are for orphan indications, it is clear
    to me that the FDA's increased focus on development and
    approval of orphan products is important to all stakeholders in
    the rare-disease community.
        I am particularly interested in learning more about the
    Office for Rare Diseases, created last year. As I understand
    it, the goal of that office is to facilitate and support
    research, product development, regulations and approval of
    biopharmaceuticals for the treatment of rare disorders and to
    serve as a focal point for stakeholders and developers of drug
    and biological products.
        If one of the primary objectives of the Office for Rare
    Diseases is to ensure collaboration among scientists and
    clinicians throughout CDER, what steps are being taken and what
    are the plans for the future to ensure adequate resources that
    are allocated to this office?
        Ms. Woodcock. Thank you.
        Yes, as part of enhancing regulatory science and expediting
    drug development within the proposals we have for the new user-
    fee program, we have a portion on rare diseases, which would
    improve resources, add additional resources to our attention to
    rare diseases, including to that office.
        Mr. Lance. And will you be engaged in that activity? And
    what time frame, Doctor?
        Ms. Woodcock. The new user-fee program hopefully will be
    passed and be able to be implemented in 2013. And, at that
    point, we would have additional resources to put----
        Mr. Lance. So this would be an action probably we would
    take next year regarding PDUFA, next year?
        Ms. Woodcock. Yes.
        Mr. Lance. Thank you. Well, I look forward to working with
    you and other interested stakeholders in this issue. It is
    important, I think, to the entire Nation and certainly
    important to the district and State I serve, which we believe
    is one of the medicine chests of the world.
        On a different topic, on biomarkers, innovative drug
    development is increasingly dependent on the use of new
    biomarkers of disease to target the right patients. Could you
    tell us what you are doing to encourage the use of biomarkers
    in drug development?
        Ms. Woodcock. Thank you.
        I think since 2004 FDA has really been in the forefront of
    this; we have been encouraging the use of biomarkers. And we
    have published numerous guidances. We have done a lot on
    something called pharmacogenomics, because a lot of these would
    be genetic markers.
        And we also now have a proposal in the new user-fee
    enhancements where we would like to enhance our activities on
    biomarkers and pharmacogenomics, because we feel this does have
    tremendous promise for patients and for drug development.
        Mr. Lance. Well, thank you, Doctor. This is my first
    opportunity to meet you. I am new to the committee, and I look
    forward to working with you.
        And I yield back the balance of my time.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the gentleman from Louisiana, Dr. Cassidy, for 5 minutes for
    questions.
        Mr. Cassidy. Thank you, Dr. Woodcock, for testifying.
        Newly active substances, just so I am clear on the
    definition, if somebody has a drug and they make it a single-
    day therapy, a prolonged release if you will, as opposed to a
    QD, does that qualify the new--so it is just a truly new drug?
        Ms. Woodcock. Yes, it has to be first, you know, time and
    first exposure to humans of this molecule, basically.
        Mr. Cassidy. Got you.
        Secondly, just to follow up on what Mr. Dingell asked
    about, man, if you are inspecting dog-food factories a little
    bit over a year but only going abroad every 9, couldn't you
    redirect resources from the dog-food factory--I am saying that
    as a pet owner--to--and, of course, it sounds tongue-in-cheek,
    but, actually, it is a very serious question.
        Ms. Woodcock. Well, Congress directs resources to drug
    programs separately from foods or veterinary medicine. So they
    are all separated out, and we have to expend those based on the
    appropriation, OK?
        Mr. Cassidy. So, would it be--not to put you in a box, but
    if Congress redirected some of the funds currently used for dog
    food, as an example, metaphorically if you will, to inspecting
    companies abroad to make sure they have good clinical or good
    manufacturing practices, would that be a reasonable thing?
        Ms. Woodcock. Well, I think, then, that is a tradeoff. The
    Congress has recently asked FDA to accomplish a great deal more
    tasks under food safety, with their new food-safety bill. And
    those inspectors are all busy trying to accomplish those
    activities.
        So we have tried--we are trying to redirect domestic
    inspection resources to do overseas inspections. And that has
    been the main effort that we are working on.
        Mr. Cassidy. So, then, to follow up that, one thing you
    could do within this silo, almost, of funding is--because I
    have had domestic drug manufacturers complain, ``Listen, I am
    checked every 6 months, and yet my competition is checked every
    9 years.'' It isn't a competitive issue for them; it is a drug-
    safety issue.
        So could you elaborate a little bit more on that occurring?
    Because it seems a very reasonable approach.
        Ms. Woodcock. Yes, I think that we are moving--we have been
    trying to move in that direction. That is a desirable thing to
    do, to have a uniform level of inspection around the world that
    is also risk-based, OK? So the riskiest plants should receive
    the most frequent inspections, whether they are in the U.S. or
    whether they are in China or elsewhere. It has just been
    logistically very difficult to accomplish this.
        Mr. Cassidy. Now, again, just to, again, pursue--it just
    seems so logical. I mean, you are going to go buy a ticket to
    go to Bangalore and inspect the plant there. Why would that be
    logistically complicated instead of going to New Jersey?
    Granted, New Jersey is a train ride and Bangalore is a trip.
    But, nonetheless, it does seem as if maybe it is a prejudice,
    that probably the people in New Jersey have better practices or
    one that we trust more than maybe just a startup in Bangalore?
        Ms. Woodcock. Yes, the inspections are done by our field
    organization. It is not a part of the Center for Drugs. And
    they have a union, and they have agreements about foreign
    travel and how much you can get people to go and do things
    overseas.
        Mr. Cassidy. You mean there is a union agreement which is
    keeping us from being able to inspect foreign manufacturers?
        Ms. Woodcock. Partly. That is my understanding.
        Mr. Cassidy. You mean the union agreement is keeping us
    from inspecting these more frequently than every 9 years?
        Ms. Woodcock. Well, the work conditions. It is just very
    difficult--my understanding; I don't supervise that
    organization--to shift resources to have a larger number of
    foreign inspections done.
        Mr. Cassidy. I have to admit, as a physician practicing, it
    gives me great concern for the safety of my patients that that
    is what is limiting our ability.
        Ms. Woodcock. We would be happy to get back to you with a
    more complete explanation.
        Mr. Cassidy. Please. Because that is so incredibly
    troubling. Which union is that?
        Ms. Woodcock. Pardon me?
        Mr. Cassidy. Which union is that?
        Ms. Woodcock. NTEU.
        Mr. Cassidy. I only have 50 seconds left. Let me gather my
    thoughts after that.
        If we had not had that union agreement, would the heparin
    tragedy have been avoided?
        Ms. Woodcock. I think it would still be difficult to move
    people from their established inspection routine and get them
    to travel repeatedly overseas.
        Mr. Cassidy. Why don't we just----
        Ms. Woodcock. But we are moving in that direction.
        Mr. Cassidy. It may be difficult with the current
    employees, but it sounds like, if that is where the problem is,
    then we just need to find employees that will go, correct?
        Ms. Woodcock. Well, there is also a problem with resources.
    I don't want to understate that, OK? That it is going to take
    more people to do all of these inspections overseas, and it
    would--it is not as efficient as inspecting a certain number of
    plants in a certain geographic area.
        Mr. Cassidy. I accept that. But, on the other hand, if you
    are going to find out where the problems are, and if we can
    trace them--the bulk of them to these companies overseas,
    manufacturing plants overseas, it just seems that is where you
    should be looking.
        Ms. Woodcock. Well, we definitely should go where the money
    is. But I would say that we have certainly found manufacturing
    problems domestically recently. Some of them have been high-
    publicity problems. And we have to maintain good coverage of
    those firms, as well.
        Mr. Cassidy. I accept that. On the balance, what would be
    the percent of the domestic versus foreign that have resulted
    in deaths?
        Ms. Woodcock. I don't think we have that kind of data.
        Mr. Cassidy. OK.
        I yield back. Thank you.
        Mr. Pitts. The chair thanks the gentleman, recognizes the
    gentleman from Pennsylvania, Dr.----
        Mr. Dingell. I forgot to ask one question. Could I ask just
    one question?
        Mr. Pitts. Go ahead. Please.
        Mr. Dingell. To the witness, if you please, H.R. 1438, the
    Drug Safety Enhancement Act of 2011, would this afford you the
    authorities you need to deal with the heparin problem?
        Ms. Woodcock. Yes.
        Mr. Dingell. It would.
        Ms. Woodcock. Yes.
        Mr. Dingell. Would you give us a little memo on why that
    is, for inclusion in the record?
        Ms. Woodcock. We would certainly be happy to.
        [The information appears at the conclusion of the hearing.]
        Mr. Dingell. Mr. Chairman, you have been enormously
    courteous, and I thank you.
        And I apologize to my colleague for having interfered with
    his time.
        Mr. Pitts. That is all right.
        The chair thanks the gentleman and recognizes Dr. Murphy of
    Pennsylvania for 5 minutes.
        Mr. Murphy. Welcome, Doctor. It is good to have you here.
        Ms. Woodcock. Thank you.
        Mr. Murphy. There was an article in yesterday's Wall Street
    Journal written by Roger Bate. I don't know if you had a chance
    to see that. But in that, he pointed out a number of things
    about the risks that come to western firms from these small,
    hard-to-detect flaws, with the trace impurities from unhygienic
    practices, which seems to summarize what we are dealing with
    here.
        The FDA--excuse me--the Federal Food, Drug, and Cosmetic
    Act provides a drug is adulterated unless the methods used for
    the manufacturing of a drug product conform to current good
    manufacturing practices. Can you explain the role and
    importance of the good manufacturing practices that FDA looks
    at in their approved products?
        Ms. Woodcock. Good manufacturing practices are a quality
    system, and you are probably familiar with quality systems from
    other areas of manufacturing. These really apply to mass
    production. So it is one thing to make a drug in a laboratory
    and have a lot of scientists looking over it. It is another
    thing to make it in a factory and make millions of doses and
    make them repeatedly sterile, potent and uncontaminated, and
    that requires adherence to a quality management system.
        The good manufacturing practices is a set of codified
    regulations that FDA has that establishes kind of the minimum
    standards for doing that.
        Mr. Murphy. Now, you have talked about the supply chain. I
    know Mr. Dingell brought that up, too. So what is preventing
    the FDA from updating its GMPs, requiring drug companies to
    verify their suppliers are complying with the law on providing
    quality ingredients? Can you tell me a couple of items there
    that are preventing you from doing that?
        Ms. Woodcock. Well, it is possible with a very long
    process, we could modify some of the good manufacturing
    practices regulation, but others--I think of the things that
    Mr. Dingell--other authorities that he was referring to would
    require legislative authorization.
        Mr. Murphy. In part of looking at that, you understand that
    this entire Nation is looking upon Congress to find ways to
    save money and also to look at health care costs, particularly
    Medicare and Medicaid which is spinning out of control.
        Is the FDA involved in or do you know of any other Federal
    agencies looking at a number of aspects? For example, when we
    look at some of these medications, and the estimates are, as an
    example, as much as 5 percent of ingredients may be impure, may
    have impure drug content, and we are looking at $1.74 billion
    and rising of imports here.
        Does anybody have any information on the impact on health
    care, such as drug shortages, and what that means to health
    care costs, tainted drugs that then effect extended stays in
    hospitals, return visits to physicians office and emergency
    rooms? Is that something that you or anybody else is studying
    the impact on health care costs?
        Ms. Woodcock. I wish we had that kind of data, but we do
    not. It is very difficult to link drug quality health problems
    with health outcomes, and Heparin was a dramatic example where
    we saw that. But we don't have overall data like that, and I
    don't know that anybody else does.
        Mr. Murphy. Well, that is certainly troubling. While we are
    looking at this, I know that studies have said just when
    patients--when patients, we have looked at something like 75
    percent of people don't take their medication properly and a
    study recently said that is a $250 billion drain on the system.
    But then when they do take medications according to doctors
    orders, and we find out there are flaws with some of the
    content of generic drugs, I don't want to malign generics
    because we are also encouraging physicians to write
    prescriptions for generics, and yet at the same time if we are
    not inspecting these plants properly we end up with causing
    more problems.
        So, does FDA have any positions they recommend then in
    terms of what other branches of government, Medicare and
    Medicaid should be doing? Are they requiring doctors to write
    prescriptions for generics while at the same time we can't
    assure that those are pure?
        Ms. Woodcock. Well, I would point out that Heparin was not
    a generic drug. There were various versions of Heparin on the
    market, but that was not a generic drug. This is not
    necessarily a generic drug problem. This is pervasive drug
    quality problem, and we don't have evidence that generics
    particularly have additional quality problems over innovator
    drugs.
        So I think physicians should write for generic drugs with
    confidence. But we do need to make sure we manage the supply
    chains, that we and mainly the companies have the systems in
    place to make sure that they maintain the quality of their
    drugs that are sold in the United States.
        Mr. Murphy. I appreciate you pointing that out about
    generics. That is a very important fact. We don't want people
    to be worried about that. It has to do with the content that
    comes over.
        You had mentioned that plants can be inspected about once
    every 9 years. The GAO says it is more like every 13 years or
    so. Plus isn't it true that when you are inspecting a plant in
    the United States, you can just show up on a surprise visit if
    you wish?
        Ms. Woodcock. Correct.
        Mr. Murphy. And the chances of surprising someone in China
    is slim and none?
        Ms. Woodcock. Right.
        Mr. Murphy. So they have a chance to change that. And so on
    this globalization of drug manufacturing and supplies, are
    there caveats that the FDA is saying then to manufacturers in
    the U.S. that even though you cannot inspect this, other
    standards you are asking them to handle on their own with this
    as well?
        Ms. Woodcock. Yes. Basically we feel that the ultimate
    responsibility lies with the manufacturer. We are not their
    quality assurance group. We are auditors to make sure that they
    are obeying the rules and that they are maintaining quality,
    and we audit all around to make sure they do that.
        There is also testing, which isn't everything, but having
    good analytical tests for potency, sterility and making sure
    the manufacturers conduct those tests, and for impurities, can
    go a long way to help ensure the safety of the drug supply.
        Mr. Murphy. Thank you, Mr. Chairman.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the gentleman from Michigan, Mr. Rogers, for 5 minutes.
        Mr. Rogers. Thank you, Mr. Chairman. Thank you, Doctor, for
    being here.
        Is venture capital important in the development of the next
    generation of pharmaceuticals, do you believe?
        Ms. Woodcock. Yes, venture capital is very important to a
    segment of the drug development industry, the smaller and
    arguably more innovative side of the industry.
        Mr. Rogers. They are targeting special treatments for
    cancer or for sepsis or all of those things, right? That is
    where the venture capital kind of flows to those innovative--so
    you are arguing it an important part hopefully of the next
    cure, we would hope?
        Ms. Woodcock. Certainly for innovation. The biotech sector
    depends on venture capital.
        Mr. Rogers. I happened to be reviewing the testimony of
    someone on the panel, Jonathan Leff. I am just going to read
    some things from here just to get your perspective on this.
        ``During 2010 and 2011 to date, first time fundings of life
    sciences ventures, a key leading indicator of the health of the
    innovation ecosystem, has decreased by more than 50 percent due
    to prior years.''
        That is a problem, isn't it?
        Ms. Woodcock. Yes.
        Mr. Rogers. What would you attribute that problem to?
        Ms. Woodcock. The problem is due to the failure rate and
    the fact that--again, I am not an economist, but what I have
    been told is that these firms are not successful enough to
    merit the return on investment, and also there is a longer term
    development cycle, that venture capital prefers a shorter
    return, and so biotech has become less attractive.
        Mr. Rogers. So it is all the investors that are pulling out
    of the market. It wouldn't have anything to do--here is his
    assessment. ``The FDA's shift in recent years to an
    increasingly cautious risk-averse posture towards new drug
    approvals has the unintended consequence of reducing investment
    in life sciences innovation due to the significant additional
    time,'' which you mentioned, ``cost and uncertainty it has
    added to the drug development process.'' True?
        Ms. Woodcock. Well, there is uncertainty in the drug
    development process, and that is the main problem. To lay it
    all at the feet of the FDA I don't think is correct. McKenzie
    has recently done a study where they looked at failures in
    Phase III development, which is clinical--the last stage of
    clinical trials, and of products that failed there, fifty
    percent failed because they had no benefit compared to placebo.
    It is really hard to attribute that to the FDA.
        Mr. Rogers. I certainly understand. But if the FDA doesn't
    recognize it has a problem, we will never get any segment of
    that fixed?
        Ms. Woodcock. I recognize it. As I said in my oral
    testimony, I think there is a crisis in the industry, and it is
    pervasive and it is very concerning.
        Mr. Rogers. What would be your recommendation for Congress
    to try to help us through that particular process? Can you
    clearly say that the added time and bureaucracy and investment
    is gaining--it is worth the sacrifice of losing innovation and
    attracting capital? Is it worth it?
        Ms. Woodcock. We feel that the scientific challenges are
    the problem, not the regulatory challenges. So I would disagree
    with Mr. Leff on this. And our data shows that we have a very
    high rate of first cycle approval. So it is hard to lay this at
    FDA's feet.
        I was hesitating in responding to you because I have a
    whole list of prescriptions for this problem that I have been
    promulgating for some time, and I would be happy to share those
    with you outside of this venue, because they are fairly
    extensive.
        Mr. Rogers. I would be delighted. With your permission, I
    would receive that at your earliest convenience. I think that
    would be helpful.
        The lines in the sand are hard things, and when you look at
    the real decrease in investment, to say that the FDA isn't a
    part of that problem is a little concerning. Let me give you
    some other statistics here I find shocking.
        The venture capital funds raised have decreased 25 percent
    in 2010 just over 2009, and that is the third consecutive year
    of decline. The share of venture capital invested in
    biotechnology declined from 18 percent in 2009 to 12 percent in
    2010. From 2008 to 2010, investment in U.S. Life sciences
    companies declined by $2 billion.
        That is significant. And I agree with you, it is a crisis
    that we are going to have to deal with. As a cancer survivor
    myself, I hope somebody is willing to put up the capital to go
    through the process, and I want the FDA to understand that
    there are risks involved and they should be part of the process
    to help quickly determine the efficacy of that particular drug.
        I am concerned that the risk aversion has crept into the
    FDA to a point that it is costing us innovation in the United
    States, and to me that is an unacceptable outcome.
        Do you think there would be any value in having a category
    of drug, and I heard the discussion earlier, you know, if I am
    sitting with my oncologist and my oncologist tells me that this
    is the particular drug that I have seen work, it has saved
    someone's life, it has added years to their life, but the FDA
    says I can't give it to you even if I explain all the risks
    involved, is there a better way to do that?
        Ms. Woodcock. Well, I don't think the FDA--that is the
    FDA's posture, that people can't give drugs to patients. As I
    said earlier----
        Mr. Rogers. Well, if you take it off the market, it clearly
    is.
        Ms. Woodcock. Are you talking about Avastin?
        Mr. Rogers. Yes. As an example. I just used that as an
    example.
        Ms. Woodcock. Avastin is on the market for other
    indications and will remain on the market.
        Mr. Rogers. I don't want to debate if you feel that is the
    right decision. But shouldn't there be the opportunity--I tell
    you that, because many a Member will run into a constituent who
    will fly out of the country to get access to a drug because
    they have made the conclusion that their life is at a point
    where they are willing to take that risk.
        Ms. Woodcock. Right.
        Mr. Rogers. Is there some value in that in the United
    States? Do we have to force people to go to Mexico to do this?
        Ms. Woodcock. We don't stand between people getting
    investigational drugs if they have no other options, and we
    passed regulations about 18 months ago that provide a broad
    range of ways to access totally investigational drugs,
    especially for people who have exhausted other types of
    therapies. So we agree that people have a right to take
    substantial risk.
        Mr. Rogers. At their own risk.
        Ms. Woodcock. Yes.
        Mr. Rogers. I would love to work with you on the expansion
    of that. I think there have been some problems in the past and
    currently that I think we can, working together, solve this
    problem for literally thousands and thousands of people who are
    at a pretty emotional place in their life and are willing to
    take some risks.
        With that, I yield back.
        Mr. Pitts. The chair thanks the gentleman.
        That concludes our first panel. Dr. Woodcock, thank you
    very much for your testimony, for your answers to our
    questions.
        At this point, we will call the second panel. I think we
    will take 5 minutes here just to check the mikes and then we
    will reconvene.
        [Recess.]
        Mr. Pitts. I think we are ready to reconvene. Our second
    panel has a number of witnesses, and I will introduce them and
    ask them to testify in this order.
        Paul Hastings is the President and Chief Executive Officer
    of OncoMed Pharmaceuticals. Jonathan Leff is the Managing
    Director of Warburg Pincus. Mark Boutin is the Executive Vice
    President and Chief Operating Officer of the National Health
    Council. Dr. Ellen Sigal is the Chair and Founder of Friends of
    Cancer Research. Lastly, Allan Coukell is the Director of
    Medical Programs of the Pew Health Group of the Pew Charitable
    Trust.
        Your written testimony will be made a part of the official
    record. We ask that you summarize your opening statements in 5
    minutes.
        Mr. Hastings, you may begin.

     STATEMENTS OF PAUL J. HASTINGS, PRESIDENT AND CHIEF EXECUTIVE
         OFFICER, ONCOMED PHARMACEUTICALS, INC., ON BEHALF OF
    BIOTECHNOLOGY INDUSTRY ORGANIZATION; JONATHAN S. LEFF, MANAGING
      DIRECTOR, WARBURG PINCUS, LLC; MARC BOUTIN, EXECUTIVE VICE
    PRESIDENT AND CHIEF OPERATING OFFICER, NATIONAL HEALTH COUNCIL;
      ELLEN V. SIGAL, CHAIRPERSON AND FOUNDER, FRIENDS OF CANCER
    RESEARCH; AND ALLAN COUKELL, DIRECTOR OF MEDICAL PROGRAMS, PEW
                HEALTH GROUP, THE PEW CHARITABLE TRUSTS

                     STATEMENT OF PAUL J. HASTINGS

        Mr. Hastings. Thank you. Chairman Pitts, Ranking Member
    Pallone, members of the committee, my name is Paul Hastings. I
    am the President and Chief Executive Officer of OncoMed
    Pharmaceuticals. I am here testifying on behalf of the Biotech
    Industry Organization's 1,100 members, where I serve as Vice
    Chairman of the Emerging Company Section; that would be small
    companies. I also chair the Bay Area Life Sciences Association,
    and I am a member of the board of the California Health Care
    Institute. All of these organizations represent innovative life
    science companies.
        I have over 25 years of experience in the biotechnology and
    pharmaceutical industry. My current company, OncoMed
    Pharmaceuticals, is developing molecules based on new
    understandings of how tumors grow and spread. Specifically, we
    are trying to block biological pathways critical for the
    survival of tumor initiating cells. These cells are more
    resistant to current therapies and promote the growth of
    cancerous tumors. Thus, our products offer real advancement in
    the treatment of cancer. We presently have three products in
    Phase I and Phase I-A clinical trials after being in existence
    for 6 years.
        Companies like mine are generating many new therapies to
    treat patients suffering from a myriad of unmet medical needs.
    Of the 172 scientifically novel and orphan drugs approved from
    1998 to 2007, 52 percent of them were discovered or developed
    by biotechnology companies. We offer tremendous hope to
    patients, with over 3,700 new biotherapeutics in development.
        Biotechnology is an American success story. Our life
    science sector accounts for over 7 million in direct and
    related jobs. We create high-paying jobs in our companies and
    support employment and provide vital revenue for our
    universities and medical centers through the clinical trials we
    conduct, thus employing people in those important State and
    local universities and medical centers. We have a national
    imperative to foster the development of innovative treatments
    and therapies.
        By 2030, almost one out of every five Americans will be 65
    years or older, which means dramatically increased costs
    associated with treating chronic disease. Innovative medicines
    can help offset these costs by preventing or delaying the need
    for other costly services such as emergency room visits and
    hospitalizations. If you just simply reduce cancer deaths by 10
    percent, that is equal to $4 trillion in economic value.
        Our position as global leadership is a position we can no
    longer presume to keep. We face international threats, such as
    India and China and the European Union increasing funding and
    incentives for biotech companies, while at the same time
    investment in the U.S. has decreased markedly.
        To encourage innovation and maintain U.S. leadership, we
    must have an FDA that is empowered and able to effectively and
    consistently review breakthrough treatments and therapies.
    There are several troubling trends that threaten to severely
    hamper our ability to innovate. For example, only half of the
    products submitted to the FDA are approved on the first
    submission. From the average of the previous PDUFA rounds of
    2003 to 2007 to today, drug and biologic approval times have
    increased 28 percent, and between 1999 and 2005 the average
    length of clinical trials grew by 70 percent.
        Regulatory uncertainty deters future venture investment in
    biotechnology companies. This results in longer time for
    development, not time for approval once drugs are submitted,
    longer time for development when you start the development
    process in Phase I; lower investment, fewer cures for patients,
    and not as many life science jobs.
        It is important to maintain a balanced and consistent
    regulatory system. To that end, among BIO's top priorities
    throughout the PDUFA technical discussions was to promote
    innovation by fostering scientist-to-scientist dialogue between
    FDA and sponsors concerning high priority rate limiting
    scientific issues that arise during drug development. We are
    pleased that FDA agreed to adopt a new policy that timely
    interactive communication with sponsors during the drug
    development is a core activity to help achieve the agency's
    mission.
        BIO believes that PDUFA should be reauthorized in a timely
    and expeditious manner. However, additionally, last week during
    the BIO international convention, we unveiled a package of
    policy proposals entitled Unleashing the Promise of
    Biotechnology: Advancing American Innovation to Cure Disease
    and Save Lives. This is a BIO initiative, with the thought in
    mind to come with you with not complaints but solutions. The
    FDA policy recommendations described in my written testimony
    are designed to ensure a clear and effective pathway for
    turning ideas into realities that will benefit patients and
    improve public health. The proposals are focused on creating a
    modern, forward looking FDA and creating more effective
    clinical research and development processes.
        Some of the highlights of our proposals include updating
    the FDA mission statement to reflect its role in advancing
    medical innovation; providing FDA with the management,
    budgetary and advisory authorities reflective of its role in
    regulating a quarter of our country's GDP; providing FDA with
    authorities, expertise, implementation mechanisms to ensure the
    development of forward-thinking strategies and implementation
    of modern regulatory science into their review practice;
    expanding and improving the accelerated approval pathway into a
    progressive approval mechanism for innovative products for
    unmet medical needs that would also serve to ensure a risk-
    benefit analysis that incorporates the safety and needs of
    patients in the real world.
        Lastly, proposals to further empower the FDA to utilize a
    weight of the evidence approach and ensure that the FDA
    communicates to sponsors in clear terms why risk was determined
    to outweigh benefits and why other agency authorities, such as
    REMS, are insufficient.
        Thank you for the opportunity to share with you our
    thoughts today.
        [The prepared statement of Mr. Hastings follows:]

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        Mr. Pitts. The chair thanks the gentleman.
        Mr. Leff, you are recognized for 5 minutes.

                     STATEMENT OF JONATHAN S. LEFF

        Mr. Leff. Thank you. Chairman Pitts, Ranking Member
    Pallone, and members of the committee, my name is Jonathan
    Leff. I am a managing director at Warburg Pincus, where I lead
    the firm's investment efforts in biotechnology and
    pharmaceuticals. I have more than 15 years of experience as a
    life sciences venture investor and have served on the boards of
    and helped build more than 15 small entrepreneurial companies
    involved in developing novel therapies for a range of diseases,
    companies not unlike the one that Mr. Hastings described. It is
    my privilege to be here today.
        Venture capital provides the essential fuel for medical
    innovation by funding the development of novel therapies, an
    endeavor that requires hundreds of millions of dollars over
    many years or even decades. Venture capital has been a primary
    source of this vital risk capital, has funded the development
    of an entire generation of important new medicines, and has
    financed and helped build almost every successful biotechnology
    company in the U.S., creating well over 1 million high quality
    jobs.
        Today, however, the U.S. medical innovation ecosystem is in
    jeopardy. Life sciences venture capital is experiencing an
    alarming decline. The primary reason is that the cost, time and
    risk involved in developing new drugs and biologics have
    increased to unsustainable levels. As a result, vital risk
    capital is being diverted to other industries and to other
    countries. At a time when medical research is exploding with
    potential, many scientific discoveries are not being developed
    into new medicines due to lack of investment capital.
        While many factors have contributed to the escalating cost,
    time and risk of drug development, a changing regulatory
    environment at the FDA is the most significant. In the early
    1990s, Congress and the FDA worked together to shape a new drug
    approval system designed to balance the goal of ensuring drug
    safety with the desire to speed new therapies to seriously ill
    patients. As a result of this balanced regulatory environment,
    for example, HIV is no longer a death sentence, cancer patients
    have access to many dozens of important new medicines, and the
    U.S. has established itself as the world's leader in life
    sciences innovation.
        By the middle of the last decade, however, the political
    backdrop and public consensus that made all of this possible
    had changed. Following the safety issues with Vioxx, the public
    discourse began to heavily emphasize drug safety. Far from
    being congratulated for speeding new treatments to sick
    patients or for advancing medical innovation, FDA has instead
    come under heavy criticism for failing to do enough to ensure
    patient safety.
        Naturally, FDA officials have responded to this changing
    environment, including congressional hearings and media
    attention, and have shifted to a more cautious, risk averse
    posture in the new drug approval process, emphasizing the
    potential risks of new treatments more than their benefits to
    patients. My written testimony provides examples of how this
    shift has become evident.
        Without question, protecting patients from harm is an
    essential element of what the public expects from the FDA. But
    so too is enabling the timely development and availability of
    new therapies. Finding the right balance is the central
    challenge of the new drug approval process. However, I want to
    emphasize that the way this balance is struck by regulators and
    by policymakers has tremendously important implications for
    U.S. leadership in medical innovation.
        FDA's shift in recent years to an increasingly cautious
    posture toward drug approvals has had the unintended
    consequence of reducing investments to life sciences innovation
    due to the significant additional time, cost and uncertainty it
    has added to the drug development process.
        In the face of new hurdles to FDA approval, investors are
    moving away from critical areas, including cancer, diabetes,
    rare diseases and many others. I believe these problems are
    fixable if we act now. Twenty years ago, U.S. policymakers and
    the FDA rose to the challenge. We have the opportunity to do
    the same today.
        My recommendations are as follows: Strengthen FDA's mission
    statement to reflect the importance of innovation; expand the
    accelerated approval pathway into a progressive approval system
    for new drugs that offer a significant advance; empower FDA to
    weigh all evidence in the context of the disease being treated
    in assessing benefit versus risk in new drug approvals; fully
    detail the FDA's benefit-risk calculus when denying or delaying
    approval in favor of collecting more data; and, finally, ensure
    that FDA is provided with the resources that it needs to
    accomplish its mission.
        I look forward to working with the committee to
    reinvigorate and strengthen U.S. leadership in medical
    innovation. Thank you.
        [The prepared statement of Mr. Leff follows:]

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        Mr. Pitts. The chair thanks the gentleman, and recognizes
    Mr. Boutin for 5 minutes for an opening statement.

                        STATEMENT OF MARC BOUTIN

        Mr. Boutin. Thank you, Mr. Chairman, Ranking Member
    Pallone, and distinguished members of the committee. My name is
    Mark Boutin, and I am the Executive Vice President and Chief
    Operating Officer at the National Health Council, which
    represents approximately 133 million people with chronic
    diseases and disabilities.
        Our membership includes large patient advocacy
    organizations like the American Cancer Society, the American
    Heart Association, as well as smaller organizations like the
    Alpha One Foundation and the Children's Foundation. We provide
    a united voice for people with chronic diseases and
    disabilities.
        Our membership also includes organizations such as the
    American Academy of Cardiology, nonprofits with interests in
    health, including family care giving organizations, and
    business and industry. Our governance is controlled by the
    patient advocacy organizations, and we represent patients, not
    consumers.
        I make that point because often patients and consumers are
    confused. While we have a lot in common, we are at opposite
    ends of the same spectrum. We define patients as people with
    chronic diseases and disabilities. They are people who will use
    the health care system to manage their daily lives. They will
    use the health care system until they die.
        Consumers use the health care system on an ad hoc basis,
    often for acute instances. An easy way to put your arms around
    it is imagine that you have mild hay fever. It acts up in
    spring. There are many options to address hay fever, over-the-
    counter prescriptions. But I can tell you if a new product
    comes to market and it has serious side effects, perhaps it
    causes severe headaches, rashes, diarrhea, vomiting, you are
    not going to be willing to take a risk on that new medicine.
        But if you discover that you are having intestinal
    problems, you go to your doctor after putting it off for some
    time and you are diagnosed with pancreatic cancer and you are
    told you have 11 months to live, your willingness to take a
    product that might extend your life by 6 months will
    dramatically increase. You might be quite happy to take that
    same product that causes the rash, severe headaches, diarrhea,
    vomiting. It doesn't change your tolerance for risk for the hay
    fever medicine. Benefit-risk is an incredibly complex issue and
    one of the things I would like to address today.
        As has already been referred to earlier, the patient
    advocacy community actually chained themselves to the fence at
    FDA and NIH nearly 20 years ago asking for significant change,
    and as a result of that, they went to the FDA and said, let's
    be allowed to have early access to treatments. And the FDA
    appropriately said, no, we are not going to allow you to have
    access to those treatments. We don't know what the risks of
    them are.
        The patient community said, you know what? I am going to be
    dead in 2 years, I am willing to accept that risk. And the FDA
    responded and Congress responded with the first iteration of
    PDUFA. As a result, we have seen dramatic improvements in terms
    of early access to new treatments and the development of new
    treatments, and we in the patient community have been very
    pleased with the success of these products.
        Unfortunately, the patient communities, somewhat naively,
    thought we were done. We are relatively new to advocacy. We
    really only started about 25 years ago. We actually stepped
    back to a large extent from the FDA and the environment
    shifted, and what we have seen is significant change. We are
    back at the table now saying that we need to look at these
    issues in different ways.
        What I would like to do is address two interrelated issues,
    the first being benefit-risk, the second being conflict of
    interest.
        As I said, benefit-risk is a complex issue. The FDA is
    charged with looking at benefit-risk from a population-based
    model. But as we know, benefit-risk is very much an individual
    decision. It is very personalized to the individual person and
    their family caregivers.
        Take for example Mark Stecker, who is somebody that about 7
    years ago was walking in Manhattan and realized he had a limp.
    Shortly thereafter he was diagnosed with MS. He is now confined
    to a wheelchair, and he runs a blog, and he is very articulate
    about saying that he is very interested in assuming far greater
    risk than he is currently allowed.
        I would say to you, many people in the disability and
    disease community feel the same way. While we had great success
    for HIV and AIDS, to some extent cancer and to a lesser extent
    heart disease, there are many conditions, from rare diseases to
    larger conditions like Alzheimer's, MS and other neurologic
    conditions without effective treatments, with many people
    willing to accept risk that they are often not allowed to.
        As I said, this is complex, and risk determinations can
    vary from condition to condition. Somebody with Alzheimer's is
    probably more likely to take a risk than somebody with heart
    disease. It can change even within an individual. If you think
    about somebody with breast cancer that is in their late
    twenties and they have two children, their willingness to take
    a risk that might extend their life long enough to see their
    children grow up and get married, because it is very
    pronounced. But you could have another woman in her eighties
    with the same diagnosis who might choose a different product
    that is going to allow her to have better quality and perhaps
    less longevity.
        At this point in time, it is important to recognize that
    there is no Federal regulatory body anywhere in the world that
    has identified benefit-risk or crafted a clear framework for
    benefit-risk. As part of the PDUFA negotiation, the stakeholder
    community was involved, and this was a huge priority for the
    patient community, and we were able to work with the FDA and
    industry to insert a benefit-risk analysis into the agreement.
    This will allow for a great deal of consistency, transparency
    and effective communication. It will allow for the benefits to
    be more clearly defined and it will allow for contacts and
    credibility.
        I apologize for running over my time. Thank you.
        [The prepared statement of Mr. Boutin follows:]

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        Mr. Pitts. The chair thanks the gentleman, and recognizes
    Dr. Sigal for 5 minutes.

                      STATEMENT OF ELLEN V. SIGAL

        Ms. Sigal. Good afternoon, Chairman Pitts, Ranking Member
    Pallone, and all members. It is a great honor for me to testify
    today.
        My name is Ellen Sigal. I am chair of Friends of Cancer
    Research. Friends of Cancer Research is a Washington-based
    think tank. We publish. We are involved with the American
    Cancer Society, professional societies, patient groups,
    advocates. Our sole mission is really the integration of
    science for better treatment for patients.
        This is very personal for me, as it is for all of you.
    Friends started 15 years ago when I lost my 40-year-old sister,
    leaving a 4-year-old child. Since then, my mother died of
    pancreatic cancer, my father died of prostate cancer, my
    husband has cancer, and there is no one that we all don't know
    that isn't impacted. So this mission is quite personal for me
    and for all of you.
        My testimony today is intended to give a perspective on
    what can be done. First of all, the urgency of getting new
    life-saving treatments to patients in the safest and quickest
    possible way; the importance of maintaining our global
    competitiveness; and finally to realize the full potential of
    biomedical research and the role that all sectors play. None of
    these things can be accomplished without a fully resourced and
    scientifically vigorous FDA.
        For many years we have been hearing about the slowness of
    FDA and particularly in oncology, so the agency has been
    portrayed by many critics as slow and inefficient compared to
    other countries. The criticism is particularly concerning in
    the field of cancer, where severely ill patients have few
    effective options. A new Friends of Cancer Research study
    published in Health Affairs revealed that FDA is approving
    anti-cancer drugs much faster than its overseas counterpart,
    the European Medicines Agency. What is important is the
    standard is high. It is the gold standard on both.
        Of its findings, our study revealed that FDA not only
    approved more cancer drugs than Europe, but they did so at a
    significantly faster rate. FDA approved average drugs in 182
    days, while EMA averaged 350 days. Access to new medications 5
    \1/2\ months sooner has undoubtedly improved the lives of 1.5
    million Americans diagnosed with cancer every year.
        While we praise this and we think this is very important,
    this cannot be accomplished nor sustained without
    appropriations needed to continue this effort. I have very
    specific recommendations that are in my testimony, and I would
    like to talk about a few of them.
        First and foremost, FDA has to have the scientific tools,
    the regulatory science programs better to enable them to make
    these very complicated decisions. Whether it is adaptive trial
    design, validation of biomarkers, it is urgent that they have
    the resources to really have this. We believe very strongly and
    support the continuance of accelerated approval process. Ten of
    the 32 new oncology products in our study utilized this
    mechanism.
        We also are recommending expedited development programs to
    address challenges to the current multi-phase sequential
    development process. This could be particularly important to
    ensure scientific rigor for targeted therapies. We want to
    ensure that FDA has the highest quality access to the best
    expertise possible in making informed decisions, and we believe
    patients have a very important role at that table and that role
    has to be accelerated.
        A weakened, underfunded FDA will cause companies to take
    research overseas, creating a loss of jobs and billions of
    dollars in investment, it will threaten our standing as global
    leader, and, most importantly, it will delay getting
    potentially lifesaving treatment to patients battling disease
    and illness.
        The role of the Food and Drug Administration as a component
    of medical innovation is critical, but successful innovation
    does not solely include the FDA. Our data indicates that the
    end stage review is on average half the duration of the FDA
    U.S. and EMA. While this indeed translates to American cancer
    patients gaining access to new drugs, it does not address the
    fundamental challenges to advancing health innovation that are
    currently facing our society.
        In order to resolve the larger problem, all of the sectors
    represented at this hearing today and several of those that are
    not must at all times set aside the individual interests and
    work towards the common goal of improving the health of the
    country, both economic and personal, through innovation. As
    patients, we all have been and we all should demand it. The
    people will all work on behalf of the deserved. We are asking
    that everyone work together towards these goals.
        Thank you.
        [The prepared statement of Ms. Sigal follows:]

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        Mr. Pitts. The chair thanks the gentlelady, and now
    recognizes Mr. Coukell for 5 minutes for an opening statement.

                       STATEMENT OF ALLAN COUKELL

        Mr. Coukell. Mr. Chairman, Ranking Member Pallone, members
    of the subcommittee, thank you for the opportunity to present
    testimony.
        My name is Allan Coukell. I am a pharmacist by training and
    Director of Medical Programs in the Pew Health Group, whose
    mission is to improve the health of all Americans through
    research and critical analysis.
        Pew's work addresses a range of FDA-related issues, but my
    focus today is the safety and security of the pharmaceutical
    supply chain. Next week we will release a report entitled
    ``After Heparin: Protecting Consumers from the Risks of
    Substandard and Counterfeit Drugs.'' Our research for that
    report included dozens of interviews with industry and
    regulatory experts and was informed by a recent public meeting
    that brought together pharmaceutical manufacturers,
    distributors, pharmacies, the FDA, State regulators and other
    analysts and stakeholders.
        The meeting heard that while the vast majority of drugs in
    our pharmacies and medicine cabinets are not counterfeit or
    adulterated, drug manufacturing has changed dramatically in
    recent years. It has become globalized and increasingly
    outsourced, and this creates new risks, risks dramatically
    illustrated not long ago with the intentional adulteration of
    the blood thinning drug Heparin.
        In 2007, health officials began to receive the first of
    what would ultimately be more than 500 reports of patients who
    experienced unusual adverse events, some of them fatal, after
    receiving this drug. The problem was traced to a contaminant, a
    substance introduced in place of the pure drug, and this
    occurred not in the premises of the U.S. manufacturer, but in
    China where the drug's raw ingredient was sourced from a
    complex network of suppliers.
        The evidence suggests that the adulterant was introduced
    deliberately on a large scale and for economic gain. Whoever
    made it must have known that the substance wouldn't be detected
    by the standard tests. By one estimate, the crime netted more
    than $1 million in profit.
        Later investigations pointed to other failures that
    underlined the need for systemic improvement. In particular,
    the manufacture did not audit its supplier over several years.
    The FDA approved the Chinese plant without an inspection,
    partly because agency databases confused two different
    facilities. Inspectors later found manufacturing quality
    issues, including poor control of incoming materials. And
    neither the FDA nor the manufacturer was ever able to gain
    complete access to that upstream supply chain.
        The incident represents a clear breach of the U.S. drug
    supply, and to this date no one in any country has been held
    accountable nor has Congress acted to update the statutes that
    govern drug manufacturing.
        What we heard at our meeting from a variety of experts was
    that without changes to the system, another such event is
    inevitable, not if, but when.
        The number of drugs and ingredients made at non-U.S. sites
    doubled over the past decade. About 40 percent of our finished
    drugs and 80 percent of their active ingredients now come from
    overseas, often from developing countries. Current law requires
    FDA to inspect every 2 years here in the U.S., but is silent on
    the frequency of foreign inspections and the FDA lacks the
    resources to do regular foreign inspections.
        When manufacturing shifts to low cost environments with
    reduced oversight, consumers are at risk, from the deliberate
    acts and also from failures to meet quality standards.
        Our report reviews some other recent examples, including
    the problem of so-called show shadow factories, where drugs are
    coming from a hidden source instead of the official factory. We
    discussed cases in which manufacturers falsified or concealed
    records, and we note the risk of U.S. patients receiving
    counterfeit or stolen drugs that penetrate our domestic
    distribution system.
        Let me give you one more example, a substance called DEG
    that has been linked to numerous mass poisonings around the
    world. Five years ago, this sweet-tasting liquid was mistakenly
    used to make cough syrup, killing dozens. The syrup had been
    labeled as something else. It had passed through a series of
    brokers in China and in Europe, each relabling it presumably
    without testing. Many of those who died were children. This
    occurred outside the U.S., but 70 years ago this same substance
    killed more than 100 Americans and led Congress to pass the
    Food, Drug and Cosmetic Act.
        So recently there have been important steps by the FDA and
    by individual companies to tighten the supply chain.
    Nevertheless, we must update the act for the 21st century. Pew
    advocates a number of key reforms, including measures to ensure
    that manufacturers themselves better assess risk and ensure
    safety and steps to ensure they are held accountable; increased
    inspections overseas and new enforcement tools for the FDA,
    including the ability to order drug recalls; and improved
    oversight of drug distribution, including national standards
    for wholesalers and assistance to track and verify the
    authenticity of drugs.
        I will conclude just briefly with a recent poll, a poll we
    commissioned last year among likely voters, that showed
    Americans are concerned about this issue, and across the
    political spectrum they overwhelmingly, upwards of 80 and 90
    percent, favor many of the provisions I have outlined.
        This committee has long taken a bipartisan interest in the
    safety of the drug supply. The American public supports those
    efforts, and we should not await another tragedy.
        Thank you, and I welcome your questions.
        [The prepared statement of Mr. Coukell follows:]

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        Mr. Pitts. The chair thanks the gentleman and thanks the
    panel for the testimony. We will now begin questioning, and I
    will recognize myself for 5 minutes for that purpose.
        First of all, Mr. Hastings, I have had the opportunity to
    talk to many small and mid-sized American biotech companies,
    and they are struggling right now partly because of increasing
    review times at FDA and the lack of predictability at FDA.
        Have you experienced these problems or do you know a
    company who has, and what issues are biotech companies facing
    today related to FDA?
        Mr. Hastings. We work very--is this on? No. There we go.
    Sorry about that.
        Whenever there are regulatory uncertainties, there are
    delays. A big piece of data that is missing today is not the
    speed of approval once an NDA is filed, but the speed to which
    we can enter a drug into the clinic, file an IND, get it
    through Phase I, get it into Phase II. Many of us who are lucky
    enough to get it into Phase III would be happy with approval
    times that are faster and more expedient than other countries.
    That would be great. But there is a whole process that occurs
    before the drug even is filed for an NDA, and I think it is
    important for us to work with the FDA, as we have.
        As I mentioned, the biotech industry's focus here is on
    streamlining the whole process, not just the approval process
    once the NDA is filed.
        Mr. Pitts. Mr. Leff, would you like to comment on that?
        Mr. Leff. Sure. Thank you, Mr. Chairman, I would be happy
    to.
        I think the central issue, the central impact that FDA is
    having on investors in medical innovation is, as I said in my
    statement, the increase in the time, the cost, and the risk of
    development. So it is not review times per se, although
    obviously we all want fast and efficient review times. It is
    the requirements that FDA is increasingly imposing for
    developers of drugs to move their drugs through clinical trials
    and get them in front of FDA.
        So when Dr. Woodcock made the observation that FDA is
    having a problem approving more drugs because they are not
    seeing more drugs, they are seeing fewer drugs submitted than
    in the past, I think that is absolutely right. The reason FDA
    is seeing fewer drugs submitted than in the past is because
    people like me and hundreds of other people like me making
    investment decisions on drugs that are in development or
    discoveries that are being turned into drugs are increasingly
    deciding that the cost, time and risk have become too high, and
    that is a function of the risk averse decisionmaking that has
    increased at FDA over the past decade.
        Mr. Pitts. Mr. Hastings, how many jobs does the bioscience
    sector account for, both direct and indirect?
        Mr. Hastings. I think I mentioned 7 million jobs indirectly
    and directly.
        Mr. Pitts. Seven million total. What else can we do in the
    FDA space to help create jobs? How would fixing the issues at
    FDA help these companies create jobs?
        Mr. Hastings. Mr. Chairman, I believe that the way to
    create jobs is to foster innovation, not at the expense of
    safety or efficacy. One of the proposals which is to make
    innovation a part of the mission statement, which, by the way,
    the European Union has in their mission statement, and then
    hold people accountable for innovation.
        You know, innovation could be when somebody is going
    through the process of--I will give a very practical example. I
    am running a startup company and I file an IND and I get my
    drug into Phase I. In the middle of my Phase I trial, there is
    an issue. Any kind of issue could come up in Phase I. The way
    the system is set up is I can pick up my phone or my regulatory
    person can pick up the phone and call the FDA. And the FDA are
    bound by these guidelines, by the way. The phone call takes
    place. It needs to be followed up by a letter, which comes
    usually 30 days later. Then you have 30 days to respond to that
    letter. Then they have 30 days to respond to that letter.
        Now, in that whole process, which in my mind could be
    handled in a phone call, I spent as a startup biotech CEO $4
    million a month on the burn of the company while the letter
    writing campaign was going back and forth.
        This is not the FDA's fault. These guidelines are
    guidelines that have been put in place, and I think they should
    be looked at as, you know, how can we streamline communication.
    Again, not once the NDA is filed, but how do we help companies
    innovate by making the process smoother in areas which are not
    going to create more risk? I think this would be a major.
        So if that occurs, I don't have to go to my venture
    capitalist and say I am writing a letter now and $4 million of
    burn is looking at us right down the face. He hears that $4
    million and says if I could invest that $4 million in Facebook,
    I could get a return in a month. You are going to burn that. I
    am going to need to give you--now, for me I need $1 billion to
    develop a drug, right? So that $4 million, which is huge in the
    early stages of a drug company's evolution, is just a tiny
    portion of what it is going to take.
        So each dollar is very, very important. So for innovation
    and streamlining, making processes and helping the FDA, by the
    way, make processes that are less bureaucratic, providing them
    with the staff they need to actually answer the phone calls,
    which is something we have been working on together, would be
    very helpful.
        Mr. Pitts. The chair thanks the gentleman.
        My time has expired, and the chair recognizes the ranking
    member, Mr. Pallone, for 5 minutes.
        Mr. Pallone. Thank you, Mr. Chairman. I am going to start
    with Mr. Hastings also.
        BIO recently released policy recommendations contained in
    the document ``Unleashing the Promise of Biotechnology:
    Advancing American Innovation to Cure Disease and Save Lives.''
    I appreciate the need for the kinds of proposals listed under
    the heading of Advancing Regulatory Science and Innovation. But
    I wanted to focus on one as an example, the need to enhance
    FDA's access to external scientific and medical expertise.
        The FDA has repeatedly cited the need to make improvements
    in the area of regulatory science, and as the BIO policy
    document mentions, FDA has struggled to keep up with the rapid
    pace of scientific and medical knowledge techniques and
    technology. And you know FDA launched a major regulatory
    science initiative designed to build on the achievements of
    programs like the critical path initiative. The other proposals
    in that section also seem to make a lot of sense to me.
        But my problem is that each of these concepts that you
    mentioned or that, I should say, the document mentions would
    demand a significant infusion of resources if there is any hope
    for the FDA to implement them. That is my opinion.
        I just wanted to ask you if you agree with that, that we
    need more resources to do these kind of things?
        Mr. Hastings. I think respectfully----
        Mr. Pallone. I think you lost the mike. The reason I am
    asking you this is--go ahead. I am sorry.
        Mr. Hastings. Somebody up there where you folks are a few
    minutes ago had an overreaction to an issue with a union,
    right? So I think if we can all work together to look at ways
    to prioritize.
        First of all, there is no question that our industry
    supports the FDA being adequately staffed. We actually had an
    initiative a few years ago to help them get staffed. So we
    would be all for helping them get staffed. But we also
    understand there are budget crises under way right now.
        So I would submit, running a business, and having run many
    businesses, private and public businesses, that there are
    always ways to reallocate resources to do things.
        External advisory boards are external people. You pay them
    when they walk through the door. When they leave, you stop
    paying them. That is a much more efficient use of capital than
    head count. So if there are opportunities to use external
    advisers to help keep regulatory science moving. In the case of
    FDA, by the way, they have very few regulatory science
    employees. They would like to have more. Again, we are working
    on this initiative. So there are many ways to do this.
        Mr. Pallone. The only problem that I have though, now we
    have this FDA funding bill that the House Republicans just
    passed, and that guts the FDA's funding by $570 million. It is
    a cut of 21 percent from the administration's request. So
    obviously I think there should be more resources. But if this
    goes through, we will have 21 percent less than what the
    administration is requesting.
        How are we going to implement these types of things that
    are in this BIO document if we make cuts? It is one thing to
    add. But what about now if they cut 21 percent?
        Mr. Hastings. Again, I would argue that one could look at
    reallocation, and one could also look at the risk-benefit of
    where one invests one's money.
        Mr. Pallone. All right. I know that you are part of this--
    or I should say your organization is part of this alliance for
    a stronger FDA whose mission is to get increased resources for
    FDA. So, again, I think you can always find more efficiencies,
    but I think it is going to be very difficult to do any of these
    new innovations if we see a 21 percent cut, and I think that is
    why the Alliance for a Stronger FDA is trying to increase
    resources.
        Mr. Hastings. May I respond to that? No offense, but, you
    know, in our organization, when I hear an answer like that, I
    say to the organization, figure it out.
        Mr. Pallone. It is one thing to be able to do what they are
    doing now. But to go into totally new areas with cuts in
    funding, I don't see how. But whatever--let me go to Dr. Sigal,
    because I only have 40 seconds left here.
        I found the results of your study very interesting, the one
    comparing cancer approvals in the U.S. versus Europe, and I was
    surprised, given the claims about FDA's role in the innovation
    downturn, to see a document like that.
        What prompted you to do that study and what did you expect
    to find? Were you surprised by what you found?
        Ms. Sigal. I was very surprised. What prompted me was that
    we were hearing consistently from academic institutions, from
    developers, from biotech, from patients that the FDA is slower
    and things were getting approved faster in Europe, and we know
    the standards were very high in Europe. So we were very
    concerned and we did the initial research in house, we did it
    solely in house. And we were very shocked. As a matter of fact,
    we were so surprised that we had to validate it.
        I did not expect it. And I want you to know if in fact what
    we were told as urban legend were true and in fact we were
    slower, we would have published. So this was not a matter of
    getting data that we suspected was going to--we thought we were
    going to get data that showed that Europe was more innovative
    and faster, so we were very surprised at it and clearly it was
    very important. But there is still a lot more that needs to be
    done, because the science is complex and the agency is
    significantly underfunded for the innovation that they need to
    go forward.
        Mr. Pallone. Thank you, Doctor.
        Thank you, Mr. Chairman.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    Dr. Burgess for 5 minutes for questions.
        Mr. Burgess. I thank the chairman.
        Just as a follow-up to Ranking Member Pallone's
    observations, last year twice Dr. Sharfstein came before this
    subcommittee, once with the DeCoster egg farm hearing and once
    with a hearing about are there problems with the pipeline and
    restrictions in the pipeline of getting drugs and products from
    NIH to the consuming public and is the FDA part of that
    obstruction. And both times Dr. Sharfstein testified in
    response to a direct question by me, do you need more money,
    and he assured me that the FDA had all the money that it
    needed.
        I knew that that must be right, because for those of you
    who sit up nights reading the Federal Register, you may know
    that we passed, Congress passed, I voted against it, but there
    was a big health care law about a year and a half ago, and it
    included no new money for the Food and Drug Administration in
    that big new health care law.
        Mr. Hastings and Mr. Leff, let me just ask you a question.
    If an innovator comes to the FDA and they have got something, a
    drug or device, characterize it as a black box, if you will, it
    does something good for patients, if that innovator comes to
    the FDA and asks for the pathway, what are my steps to go
    through getting this drug or device approved? Are they going to
    get clear direction and clear instruction from the FDA as to
    what procedures to follow?
        Mr. Hastings. We will get guidance, some guidance or
    recommendations on what to do in a situation like that.
        Mr. Burgess. If it is truly innovative, maybe something
    that hasn't happened before, are they likely to get an answer,
    ``we are not sure and you need to start and then we will
    provide you guidance as go along.''
        Mr. Hastings. Well, it is very difficult in the case of a
    brand new innovation when there are no benchmarks to sometimes
    give guidance, because everybody is looking at the same thing
    and wondering what to do. I think that would therefore argue
    for the ability to communicate scientist-to-scientist and work
    together. This is also where some of these external advisers
    could come in and be very helpful experts in the field in terms
    of creating not a validated instrument that may take years to
    do this, but to create a risk-reward model to move that drug
    forward since it is the first in its class. That would be the
    ideal thing to do.
        Mr. Burgess. Forgive me for interrupting, but time is very
    limited. On this risk-reward model that you just articulated,
    does that exist within the FDA? If an innovator comes to the
    FDA and says I have got this, help me know the stems I must
    take to develop this and have it approved by the FDA, is that
    model in fact in place? Does it work?
        Mr. Hastings. I mean, I can't speak for the FDA. I think
    that model would probably work differently division by
    division, depending on who the reviewer is, depending on who
    runs the division.
        Mr. Burgess. That is the regulatory uncertainty. Again, I
    have people come to my office all the time with these
    complaints that I don't get clear direction about what I am
    going to need to provide and then it all changes in the course
    of development, and that obviously extends the timeline
    significantly.
        Mr. Hastings. Well, you made a very good point about
    changing it. And, again, I don't think this is anybody's
    particular fault, but I know of CEOs who are running diabetes
    companies where endpoints were changed in the middle of their
    Phase III clinical trials as they were ongoing and had to redo
    their Phase III clinical trial. Some of those companies shut
    down.
        Mr. Burgess. Sure. I wish we had more time to explore that,
    but Mr. Coukell, I need to ask you, you talked about the
    Heparin issue which we have studied in this committee, and I
    just wanted to reassure you that we do have an active and open
    investigation now.
        Last Congress it was a little bit difficult to get
    information from the FDA. Margaret Hamburg went to China and
    presumably talked to some of these individuals who were
    involved with the companies that produced the product that was
    contaminated with the adulterant. And you are correct, the
    adulterant was a very clever molecule that could hide behind
    the normal active pharmaceutical ingredient in Heparin on the
    normal testing with the mass spec. It almost had to be a
    criminal mind that decided to do this. I don't think it was
    accidental.
        But we have had significant difficulty in getting the data
    from the FDA as to where they are in this investigation, why
    the labs were confused and issues that you mentioned. I wanted
    to reassure you that the legislative remedy really is hard to
    come up with if you don't have the results of your
    investigation. Unfortunately, this investigation has taken a
    lot longer than I would have ever thought possible, but at the
    same time you run the risk of legislating with incomplete
    information.
        Mr. Coukell. Yes, sir. I commend your ongoing interest in
    drug safety. I think it is very important. I think it would be
    highly desirable to find the culprit in that case.
        Nevertheless, I think Heparin illustrates, as I outlined in
    my testimony, a lot of weaknesses that we know about now, and
    it was a wake-up call for a lot of folks in the industry and
    for the FDA. They have all said that. The next time it happens,
    it probably won't be Heparin. It will be somewhere else. I
    think we do know based on that case and others some of the
    things that we need to do now.
        Mr. Pitts. The chair thanks the gentleman and recognizes
    the ranking member emeritus, Mr. Dingell, for 5 minutes for
    questioning.
        Mr. Dingell. Mr. Chairman, I thank you for your courtesy
    and for the recognition. I will direct my questioning to Mr.
    Coukell. I would observe that I have great concern for the
    tremendous amount of pharmaceutical medicines and ingredients
    that are coming in from abroad. So I would like to address this
    with yes or no answers here.
        An increasing number of drug manufacturers are turning to
    outsourcing for pharmaceutical ingredients and manufacturers.
    As you mentioned in your testimony, up to 80 percent of
    pharmaceutical ingredients and up to half of the finished
    pharmaceuticals are purchased from clients in India and China.
    FDA is currently required to inspect U.S. drug facilities every
    2 years, but there is no required frequency for inspection of
    foreign facilities. Food and Drug says that they investigate
    foreign facilities about once every 9 years.
        Is that sufficient or not?
        Mr. Coukell. It is not sufficient.
        Mr. Dingell. Now, until 2009 FDA did not have a dedicated
    staff for foreign inspections. Rather, employees qualified to
    do inspections would travel abroad. FDA now has a cadre of 15
    inspectors dedicated to foreign facility inspections.
        Has this current cadre been sufficient to increase
    inspection of foreign facilities to a sufficient level that we
    can be comfortable that our supply of these pharmaceuticals is
    safe?
        Mr. Coukell. They improved the local FDA's local knowledge
    and have done some additional inspections, but they are not
    enough.
        Mr. Dingell. Thank you. Now, beyond inspections, quality
    manufacturing is also critical to a safe drug supply. In 2009,
    FDA issued 34 warning letters regarding adherence to good
    manufacturing practices, nearly double what was issued in 2008,
    ensuring manufacturing quality gets more difficult as supply
    chains move overseas and are more outsourced.
        Are today's GMPs sufficient to ensure manufacturing
    quality, yes or no?
        Mr. Coukell. No, sir.
        Mr. Dingell. As you have spoken to a number of stakeholders
    and experts about FDA's oversight of foreign drug
    manufacturing, what if any consensus exists for increasing
    foreign oversight and resources to support?
        Mr. Coukell. I can't answer that with one word, sir, but
    what I can tell you is we have been interested as we talked to
    stakeholders across the system, I have expected to have people
    say inspections aren't the answer. We didn't hear that.
    Inspections are part of an overall quality system. Some major
    sectors of the industry, including the generic manufacturers
    and the active ingredient makers, are on record as supporting
    fees to help fund additional inspections overseas, both for
    safety and to provide a level playing field for American
    manufacturers.
        Mr. Dingell. Thank you. One approach to ensuring
    manufacturing quality would be to require manufacturers to
    implement quality systems that detail management
    responsibilities, risk management practices, supply chain
    management, record keeping amongst other components.
        Do you believe requiring manufacturers to have in place a
    quality system would improve the safety of our drug supply
    chain? Yes or no.
        Mr. Coukell. Yes, sir. Those are recommendations now, but
    we need everyone to do it.
        Mr. Dingell. Should such a requirement relate not only to
    finished manufactured pharmaceuticals, but also to components
    and raw materials?
        Mr. Coukell. Yes.
        Mr. Dingell. Transparency throughout the supply chain is of
    particular concern and a valid one given the Heparin incident,
    but Heparin is only one of the examples of our problems.
    Currently, FDA recommends but does not require that companies
    conduct an on-site audit of a supplier.
        Do you believe requiring companies to perform on-site
    audits of suppliers before a purchase agreement is made would
    improve supply chain safety? Yes or no.
        Mr. Coukell. Our meeting heard that every supplier and sub-
    supplier should be audited by somebody.
        Mr. Dingell. Now, how frequent should these audits be to
    assure their effectiveness?
        Mr. Coukell. I think that depends on the material and the
    level of risk.
        Mr. Dingell. Could you give us some kind of a horseback
    guess?
        Mr. Coukell. I think it is going to depend, sir. If is a
    long-established relationship and a simple synthesis, it would
    be quite different from a new relationship with somebody who is
    making a very complex molecule.
        Mr. Dingell. Now, FDA recommends but does not require
    quality agreements with suppliers. Do you believe requiring
    quality agreements with suppliers would improve supply chain
    safety? Yes or no.
        Mr. Coukell. Yes, sir, and I believe leading companies are
    already doing that.
        Mr. Dingell. Mr. Chairman, I apologize. I have a couple
    more. May I pursue my business to its end?
        Mr. Pitts. You may proceed.
        Mr. Dingell. Thank you. You are most courteous.
        More must also than done to ensure transparency and access
    to information for products being imported into the United
    States.
        Do you believe requiring importers and customs brokers to
    register with the FDA would help to improve FDA's general
    oversight of global drug production as well as drug safety
    assessments at the border? Yes or no.
        Mr. Coukell. Yes.
        Mr. Dingell. It is clear then that increasing foreign
    inspections and improving transparency and quality throughout
    the supply chain are necessary components to increasing the
    safety of our drug supply, and that would also include raw
    materials and components as well as finished products. I would
    also add, Mr. Chairman, that H.R. 1483 would address the
    vulnerabilities that we have just outlined.
        I thank you for your courtesy, and I thank our panel for
    their assistance to the committee.
        Mr. Pitts. The chair thanks the gentleman.
        Without objection, the chair recognizes Mr. Bilbray from
    California for 5 minutes for questions.
        Mr. Bilbray. Thank you very much, Mr. Chairman. Thank you
    for a chance to ask questions. I want to thank the ranking
    member for being here, because I think that this is an issue
    that we can have a bipartisan effort on. From personal
    experience in working with the ranking member for probably a
    decade, about a decade-and-a-half I think it has been, we have
    had a bipartisan effort going on water quality issues. I think
    this is one of those things that the ranking member can join
    with the majority in actually addressing an issue that knows no
    party affiliation.
        Mr. Hastings, one of the crises that I am seeing in my
    district with my bio-med research people is the fact that we
    have lost 50 percent of the venture capital for what we used to
    say in environmental issues would be the economic soup, the
    startup companies, the little guy who is the krill of the bio-
    system; in other words, where the ideas and the innovation
    comes from that the big guys eat up, adopt and then develop
    into it. We have lost 50 percent of that capital. It looks like
    we could lose 50 percent of that overseas if we don't do
    something.
        One of the items that has been brought up to me is how do
    we infuse and get venture capital back into the field, and one
    of the items is the issue that we have over $2 trillion of
    American capital overseas. Do you think that it would help in
    trying to backfill that loss of 50 percent if the Federal
    Government looks at changing the repatriation laws here to hold
    harmless if they bring the money back for research and
    development?
        Mr. Hastings. Resoundingly absolutely.
        Mr. Bilbray. Anybody else got a comment on that or concern
    with that?
        Mr. Leff. Yes, I agree it would absolutely help and it
    would bring capital back into this country and release
    additional investment and innovation. The observation I would
    make, though, is that would be a one-time benefit to the
    system. It wouldn't change the trajectory necessarily that we
    are on and the fundamental underlying reasons that capital is
    leaving investment and innovative life sciences companies.
        Mr. Bilbray. I appreciate that. I was a public safety guy.
    I am just a lifeguard that triaged people and got more votes
    than the next guy. But we do have a patient that is
    hemorrhaging, needs an infusion, an infusion to survive, and I
    think this is one thing we may be able to ask both sides to
    work on.
        Let me ask, Doctor, speaking of looking at systems, back in
    the nineties there was a bipartisan effort made that did things
    on the AIDS epidemic that we had not done for anybody else,
    extraordinary efforts. We broke the rules, changed the rules,
    forced the bureaucracy to respond, and I think history has
    proven that was a great success.
        Sadly, it looks like we did this great success and walked
    away from it. In those days we had Act Up, we had Men's Gay
    Health Crisis Project, we had the Treatment Action Group
    putting pressure on us to change the system, and we actually
    allowed patients to be at the table. We allowed, and the doctor
    can go over it, whole different protocols for what was allowed
    to be counted as a positive action, and we basically broke the
    mold and tried innovative issues.
        Is there any reason in the world why we should not go back
    and look at what was successful in addressing the AIDS crisis
    and apply it to the crisis we are finding right now? A good
    example is why would we allow an AIDS patient on a review body
    for AIDS, but would not allow a cancer patient to have the same
    right to be able to participate?
        Doctor, I solicit your comment about how we can address
    that.
        Ms. Sigal. Thank you for the opportunity. I think the HIV
    model is a wonderful model. It started activism, and, most
    importantly, it has had an impact. It helped patients, it
    helped science, and it made a huge difference.
        It is a complex scenario though, because there we had a
    fire marker. We had the CD 4. We had viral load. We knew what
    we were looking for. But it did start advocacy, and I would
    agree with you fully that patients have not only a role but a
    right to sit at the table. Ultimately these decisions impact
    them. They need knowledge, they need the ability to have the
    information, and they have the ability and should have the
    ability to be at the table when these decisions are made.
        We, along with the National Health Council and others, are
    working on that and believe that we have opportunities in the
    reauthorization of the User Fee Act to have a more active
    patient voice. It is essential that they be at the table,
    because we do impact them.
        Mr. Bilbray. The one thing I saw work in the AIDS community
    was the degree of urgency was brought on to the bureaucracy,
    the sensitivity that they know had an impact, an adverse impact
    just by denying, that at least there was opportunity there.
        What I am concerned about is the study that you did showed
    that if you take the long-range, there was an item. But my
    question is, recently though it looks like the European
    Community's review and our review are starting to close that
    gap since 2008. Do you have any way of explaining why though
    the trajectory looked real good on cancer drugs over the long
    term, recently it looks like we are converging or going to be
    crossing? In that study, did you identify why since 2008 it
    looks like the numbers are changing?
        Ms. Sigal. Actually we did go past, we did look at that.
    And in fact, since we have concluded our study, we have had
    three more approvals which they still do not have in EMA. So in
    fact the trend of earlier approval, faster approval, is
    continuing.
        The problem is the complexity of the science. The science
    is very, very, very hard. But this is not an issue of speed,
    this is an issue of quality, and I can tell you as an advocate
    myself we in the cancer community and other advocates of deadly
    diseases, childhood cancers, other cancers, are just as anxious
    as anyone to have these new drugs approved, because it will----
        Mr. Bilbray. Let me tell you as a father, I am in that
    category.
        Mr. Chairman, I appreciate the time. I think one of the
    things both sides need to talk about is the conflict of
    interest regulations that historically have been with FDA and
    these review bodies, because now you are getting, especially in
    cancer, you are getting items coming forward that the
    discipline is so limited of anybody who can make an informed
    decision that you have to bring somebody in from outside and
    somebody who has a connection to basically development and
    certain research to be able to get the expertise to make an
    informed decision. I don't think any of these conflict of
    interest requirements that we put in in the past was meant to
    exclude people that were essential to making informed
    decisions. I hope both sides can look at modifying those rules.
        Mr. Pitts. The chair thanks the gentleman. That concludes
    the first round of questioning. We will go to one follow-up on
    each side, if we have any. Dr. Burgess.
        Mr. Burgess. Thank you, Mr. Chairman. I appreciate the
    recognition.
        Mr. Boutin, if I could along that line of the advisory
    panels and the conflict of interest exclusions, are the
    restrictions on who can serve on advisory panels hindering
    activities to bring new drugs to market?
        Mr. Boutin. Yes. I think there is a real challenge. Right
    now, the FDA is charged with looking at multiple regulatory and
    legal requirements for conflict of interest, and the standards
    within each are not necessarily inconsistent, they are
    different. As a result, the FDA has had to look at how do we
    apply them all together.
        In the previous reauthorization of the prescription drug
    user fee, there was an additional requirement that compelled
    FDA to limit its use of waivers, and as a result they took a
    look at how they would apply the conflict of interest rules. In
    their new look, they acknowledge that they are being more
    strident in addressing the conflicts, and as a result what you
    are seeing is it harder to fill the advisory committees, and
    currently about 25 percent of the advisory committees are
    vacant, and as a result there is delays in having the advisory
    committees meet and the FDA has acknowledged that it has led to
    delays in the approval of new treatments.
        So from our perspective, we need to look at this carefully.
    Conflict of interest rules are important and we recognize they
    provide credibility and transparency to the process, and nobody
    is suggesting they should just be done away with. However, we
    have to balance the need for transparency and managing of
    conflict of interest with the need to ensure that we get
    treatments to people who need them.
        Mr. Burgess. That was a subject of a lot of discussion when
    we marked up this bill in 2007 and recognizing that for some
    products. Pediatric antineoplastic plasma medications, the
    universe of people that understands these is probably very
    small, and it is probably very difficult to find someone who
    has not worked in some way on the development of that product
    at some point along the line. This was really where we painted
    ourselves into a corner.
        Mr. Chairman, I hope we will be serious about fixing this.
    And your thoughts on things that we might do to relax or keep
    the appropriate focus where it needs to be but at the same time
    allow these advisory panels the ability to form and do their
    work, I think that is going to be critically important when we
    reauthorize.
        Thank you.
        Mr. Pitts. The chair thanks the gentleman.
        I don't see any other questions. That concludes today's
    hearing. I remind members they have 10 business days to submit
    questions for the record. I ask that the witnesses all agree to
    respond promptly to these questions.
        With thanks to the witnesses, this subcommittee is
    adjourned.
        [Whereupon, at 1:20 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]

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