[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:]

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    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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