55,600 Life-Years Lost Thanks to Speedy Drug Approvals

In 1992, Congress passed legislation allowing the F.D.A. to charge pharma companies a usage fee for submitting drugs for approval. In exchange, the F.D.A. promised to come back with an approval or denial decision within a predefined period of time.

After the Prescription Drug User Fee Act was passed, review times fell by 9-10 percent annually, and then by about 5 percent annually after the law was first reauthorized from 1997-2002.

Did the increased speed hurt the vetting process?

Since 1992, some F.D.A.-approved drugs including Vioxx, fen-phen, and Baycol have been yanked from the market after they were found to be life-threatening.

Overall, improperly approved drugs have led to 55,600 life-years lost, estimate Tomas J. Philipson and Eric Sun of the University of Chicago. A life-year is just what it sounds like, a year in a person's (albeit a hypothetical statistical person's) life.

A reasonable estimate for the value of a life-year is between $100,000 and $300,000, so that means between $5.6 billion and $16.6 billion in life-years were lost.

But getting safe drugs, as the vast majority of approved drugs have been thus far, to the market faster also has a benefit. Philipson and Sun put this benefit to the consumers at between $18 billion and $31 billion.

Which means, that, on net, a speedier review process has been a good thing for society.