Biotechs could save time, money from clinical trial rule change

It’s no secret that US drug development is a long, expensive, bureaucratic process.

The average cost for a major pharmaceutical company to create a new medication in 2024 was $2.6 billion, and the job takes 10–15 years from discovery to approval, according to drug industry trade group PhRMA.

To cut down on these burdens, FDA Commissioner Marty Makary told Stat on Dec. 4 the agency would change default requirements in Phase 3 clinical trials from two pivotal trials to one. While some drugs, depending on what they treat, will still require two trials, the goal is to make drug development more efficient.

This rule continues previous FDA initiatives to ease the process, such as when the agency announced it would allow one trial with confirmatory evidence before approval in 2023.

Biotech experts told Healthcare Brew this rule change could help bring drugs to market, but it’s also not a one-size-fits-all solution.

“The devil is going to be details because at the end of the day Congress requires the FDA to ensure the safety and efficacy of drugs that go into human beings,” Rahul Gupta, president of tech company GATC Health, told us.

‘Every disease will be different.’ Experts agreed the change may save some companies time and money, as it’s one less step they’d have to complete.

But the rule change won’t affect all drugs the same way. For diseases like ALS, where developing a new drug is a “race against time,” having to do just one clinical trial can make a big difference in the time it takes to get treatments to patients, Gupta said.

“Every disease will be different,” Devyn Smith, CEO at gene editing company Arbor Biotech, told us. “If you’re going after high cholesterol…you don’t want any safety issues at all.”

For conditions with high placebo rates, like pain, Smith said companies could have challenges demonstrating high efficacy in just one study and may have to do another anyway.

Company advantage. The rule change could have a greater positive impact on smaller companies, as they have fewer resources to complete clinical trials, Gupta said.

On average, clinical trials can cost $172.7 million on the lower end of the spectrum for treatments like pain/anesthesia and genitourinary-related drugs and up to $1.2 billion on the higher end for oncology drugs, according to a June 2024 JAMA study that analyzed drug development costs between 2008 and 2019.

“Startups and younger companies can reach milestones faster, they can reduce their burn rate, and they can shorten the time to success while not compromising quality, efficacy, and safety,” he said.

Since early-stage companies sometimes have several drugs in development but may only have resources to bring one to market, cutting down a clinical trial could also give smaller biotechs “more shots on the goal,” Gupta added.

Ensuring safety. Changing any safety measures may raise alarm bells for some, especially when so many people rely on medications to manage serious illnesses and conditions..

But there are a few things giving biotech experts more certainty: First, Gupta said, was that the FDA would still be able to implement postmarket surveillance to see how a drug is performing.

Second, there’s technology, like AI, that can use predictive analytics to create “more focused and targeted clinical trials,” he added.

Real-world data has also improved in recent years, Nicholas Richardson, VP of clinical development at research group Precision for Medicine and a former deputy director at the FDA, told us.

“You’re able to augment [clinical trials] with some alternative data sources that may have not been used in the past,” he said.

Third, there will still be constant dialogue between biotechs and the FDA, Smith said.

“To assume you just need one study—or assume you need two without actually having the conversation at the end of the Phase 2 meeting—would be a big mistake,” he said. “People really want to make sure they’ve got as much buy-in from the agency as possible.”