Let me talk to you about traffic jams.
Back in the 1980s, it is true that the Washington Beltway occasionally used to move. That was before it became a full-time parking lot. But there was this one spot on the Beltway that every morning at the same place, it would just jam up for miles. And the traffic engineers couldn’t figure it out.
They could not understand why in the world this one particular place would cause traffic jams every single morning. And then one day, they got a letter. It said there’s this one guy who gets on the same on-ramp at the same time every day, goes to the extreme left-hand lane, sets the cruise control at 55 mph and goes 55 mph for 17 straight miles.
And as soon as that news came out, there were hundreds more letters…
I know that idiot. I honk at him every morning. He never moves. I’ve seen the guy. He always blocks the lane, etcetera.
And then a letter came into The Washington Post (allow me to paraphrase):
“Dear Washington Post,
“My name is John Nestor.
“I get in the left-hand lane. I drive the speed limit, that’s the law. It’s easier for me to drive in the left because it’s easier for me to not move. And if somebody wants to speed, that is their problem.”
This letter led to a certain amount of outrage, to the point where the good citizens of Washington D.C. invented a verb called Nestoring.
Now, let me ask you, where do you suppose John Nestor worked?
John Nestor worked at the FDA. And he was in charge of approving renal and cardiac drugs. Under his watch, the traffic jam in drug approvals got so extreme that he got transferred… until Ralph Nader and his group sued the FDA to reinstate John Nestor because he was protecting the public interest.
The FDA was forced to reinstate Nestor. This was in the FDA archives:
“The findings of the special counsel were such that I had no choice but to reinstate a man called John Nestor–later famous for driving 55 miles an hour in the left lane of the Beltway, but then famous for driving 55 miles an hour in the left lane of the new drug approval process. There was no question that Nestor had his own agenda and his own set of beliefs about drug approval which were, in effect, that none should be approved. At the time I had to reinstate him, I called him and told him that I thought that he had not been properly treated at FDA–but also that from everything I read, I really didn’t like the way he went about doing what he was doing, and that I hoped that he would change. Well, I don’t think it did the slightest bit of good.”
After Nestor died in 1999, Nader’s health research group hailed Nestor for his “unassailable record of protecting the public from harmful drugs.”
Apparently, he didn’t approve a single drug — an absolutely unassailable record!
But the real question is by not approving drugs in the renal and cardiac unit, did he also kill people by not acting? Are there consequences to not acting? Because sometimes by not acting, by being too careful, by making it too expensive, maybe we’re killing more people than regulation is saving. And how do we measure that? Are there consequences to not measuring some of these costs?
If regulation is killing more people than it is saving, then we’ve got a problem.
I’m not arguing that’s an absolute fact. I’m just saying that we aren’t measuring it. That is medicine’s missing measure.
I want you to try a thought experiment: Imagine a fictitious FDA dossier 45000 632 A.
And here’s what you find in that dossier:
The substance that the FDA is examining is a reaction of metallic sodium and gaseous chlorate. It has high acute toxicity. It kills people in high doses. There are cardiac, renal and circulatory counter-indications, which mean it hurts your heart, kidneys and circulatory system. And a similar compound of sodium chloride is a Category 5 poison in Switzerland.
Would you approve this chemical? Would you allow this to come to market? With a prescription or without a prescription? In today’s environment, you’d probably say, “Hell no!” The only logical conclusion is to ban the compound. Well, good job. You just banned table salt. Table salt would simply not be able to go through an FDA medical approval process.
On an order of magnitude, 5,000 compounds start coming in to be tested, 500 go into Phase 1 trials, 50 go into Phase 2, five go into Phase 3 and then, finally, one comes to your pharmacy. That’s a daunting risk/reward proposition for most medical technology companies. And that’s a big part of the reason new drugs don’t come to market. The hurdle in terms of time and expense is simply too high.
That’s a major traffic jam…and it is costing thousands of lives.
Ed. Note: Even with the incredible regulatory hurdles in the drug approval process, there are still several biotech companies with great products coming to market. And readers of the FREE Tomorrow in Review email edition are given regular opportunities to discover (and profit) from a few of these companies first-hand… Sign up for the FREE Tomorrow in Review email edition, right here to ensure your access to potentially life-changing investment opportunities.
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