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At least $200M has been spent on drugs that have yet to be approved by the U.S. Food and Drug Administration, according to a recent data analysis conducted by the Associated Press.

The report also noted that while these drugs have not been reviewed for safety and efficacy, they are still covered by Medicaid, thus possibly creating a "dangerous sense of false security."

The FDA says it is trying to control the drugs on the market, but conflicting federal laws allow the Medicaid health program for low-income people to pay for them.

Nearly $198M in Medicaid funds was spent on more than 100 unapproved drugs between 2004 and 2007. Medicaid officials acknowledge the problem, but say they need help from Congress to fix it.

"I think this is something we ought to look at very hard, and we ought to fix it," said Medicaid chief Herb Kuhn. "It raises a whole set of questions, not only in terms of safety, but in the efficiency of the program - to make sure we are getting the right set of services for beneficiaries.

The FDA estimates that unapproved drugs account for 2 percent of all prescriptions filled by U.S. pharmacies, about 72 million prescriptions a year. Private insurance plans also cover them.

Sen. Charles Grassley, R-Iowa, has asked the Health and Human Services Department inspector general to investigate the issue.

According to the FDA's Web site: "The FDA drug approval process provides a review of product-specific information that is critical to ensuring the safety and efficacy of a finished drug product. For instance, the applicant must demonstrate that its manufacturing processes can reliably produce drug products of expected identity, strength, quality, and purity."

The FDA wasn't given the responsibility of reviewing all new medications until 1962, which left thousands of unapproved drugs already on the market to be evaluated.

However, some manufacturers claimed their medications were "grandfathered" under earlier laws, and even under the 1962 bill.

Then, in the early 1980s, a safety scandal erupted over one of those medications. E-Ferol, a high potency vitamin E injection, was linked to serious reactions in some 100 premature babies, 40 of whom died.

This spurred a new FDA initiative to determine which drugs had never been scientifically reviewed.

But critics say the FDA's case-by-case enforcement approach is not working.

"The FDA does not appear to have a systematic mechanism to report these drugs out," said Jon Glaudemans, senior vice president of Avalere Health, a health care industry information company, "and there doesn't seem to be a systematic process by which health insurance programs can validate their status. And everyone is pointing the finger at someone else as to why we can't get there."

In most cases, doctors, pharmacists and patients are not aware the drugs are unapproved.

"Over the years, they have become fully entrenched in the system," said Patti Manolakis, a Charlotte, N.C., pharmacist who has studied the issue. Only a few unapproved drugs are truly essential and should remain on the market, she added.

Medicaid claims it is allowed to pay for unapproved drugs until the FDA orders a specific medication off the market.

On the other hand, Medicare is not allowed to pay for such drugs, and has taken hundreds of unapproved medications off of its coverage list.

FDA officials say compiling a list of unapproved drugs would be difficult because many manufacturers do not list unapproved products with the agency. However, the AP found many that were listed - a possible starting point for a list.

"The problem I see is bureaucrats don't want to make a decision," Senator Grassley said. "There is no reason why this should be such a house of mirrors when so much public money is being spent."

Some manufacturers of unapproved drugs say their products predate FDA regulation and are "grandfathered in."

"These are drugs that don't require an FDA approval," said Bill Peters, chief financial officer of Hi-Tech Pharmacal in Amityville, N.Y. "These are products with active ingredients that have been on the market for a long time."

The FDA is targeting drugs linked to fraud, ones that do not work and, above all, those with safety risks. While the crackdown has helped, the problem is still present.

SOURCE: redOrbit Staff & Wire Reports