Each year, a select group of novel new drugs enter the U.S. market. In 2023, 55 new drugs were approved—adding to the more than 20,000 prescription drugs already in circulation.
The process of evaluating and approving new drugs dates back to the 1960s, when the FDA began requiring evidence of a drug’s safety and efficacy based on data collected in multi-phase controlled clinical trials.
As the decades have passed, the FDA has refined and reformed its process, with important efforts being made to increase clinical trial diversity, protect enrolled participants, and shorten the bench-to-market timeline for new drugs in therapeutic areas where currently available treatments are inadequate or lacking.
Oversight of this process largely falls to the FDA’s Center for Drug Evaluation and Research (CDER), which handles most drug approvals. Meanwhile, its counterpart, the Center for Biologics Evaluation and Research (CBER), manages the approval of vaccines and a limited number of other biologic products, operating under similar guidelines.
The odds remain steep: Only about one in eight drug candidates in clinical trials make it to market. And for each one that does, the investment is significant, with research and development costs ranging from $1 to $2 billion per drug. Despite these high costs and hurdles to getting FDA approval, there are even more tests once a drug is introduced to the market.
Before the Trials: Preclinical Research
The preclinical phase of drug development involves experiments on a potential new drug, typically done by academics or pharmaceutical companies, before it’s tried on humans. This testing is called “in vitro” if it takes place in test tubes or petri dishes, and “in vivo” when it takes place in animals. (However, newer FDA guidance now promotes alternatives to animal testing, such as computer modeling.)
The goal during this phase is to assess whether a potential drug has promising clinical applications and whether it may be safe for humans based on toxicology testing. If these early research findings look good, the next step is an Investigational New Drug (IND) application, says Jill M. Hernandez, PharmD, MHA, a clinical research pharmacist. This application is typically sponsored by the pharmaceutical company responsible for preclinical testing and includes years of preclinical data. This application is then sent to the FDA for review, a process that can take 30 days or more.
In addition to reviewing research findings, the FDA also analyzes the company’s plans for conducting clinical trials, says Dr. Hernandez, noting study protocols and manufacturing methods as key areas they scrutinize. New FDA guidance also requires the company to provide a Diversity Action Plan detailing how they plan to recruit clinical trial participants with the goal of matching the population intended to take the new drug.
Having participants from a broad demographic helps predict how different people may respond to the drug, explains Bindu Balani, MD, clinical primary investigator for clinical trials at Hackensack Meridian Health Research Institute. For example, Dr. Balani notes that genetics may affect how quickly your body clears a new drug from your body—information that may help determine safe dosages. In addition to biological sex, race, and ethnicity, other diversity factors include socioeconomic status, geographical location, sexual orientation, and gender identity. Age, pregnancy, and lactation status are also factors.
The clinical trial design very much depends on the nature of the specific drug and disease it’s intended to treat, notes Dr. Hernandez. If approved, a company can move forward with testing in humans. There are four clinical drug trial phases.
FDA Clinical Trials: Phase 1, Safety Trials
The goal of phase-1 research is to determine a safe dosing range in a small group of healthy volunteers, says Dr. Hernandez. Study participants are usually required to allow for long sessions so a series of labs can be drawn after they’re given a dose. Researchers use these lab findings to understand how the drug is absorbed, moves through the body, and is broken down (metabolized) and excreted.
“We’ll often start with a very low dose that’s chosen based on preclinical research,” explains Dr. Hernandez. From there, higher doses of the medication are gradually tested to determine the maximum tolerable dose. In later trials, only the two or three highest doses are usually evaluated. This approach has led to some drugs being used at doses higher than necessary for efficacy, which can increase side effects and the risk of adverse events.
Phase 1 usually lasts a month or less and includes about 20 to 80 volunteers. Given the risk of a first-in-human study, participants are typically paid a singular stipend—$3,070 on average, according to one 2021 study of 131 trial participants. Participants are informed of the study’s purpose, procedures, potential risks, and benefits through an informed consent process, which is regulated by strict FDA guidelines.
Trials involving more toxic drugs, such as those used to fight cancer, often enroll individuals with the disease the drug is intended to target.
FDA Clinical Trials: Phase 2, Efficacy and Side Effects
“In Phase 2, we start looking at the efficacy of the drug for the intended indication,” says Dr. Hernandez. Intended indication refers to the specific purpose for which the medication is prescribed and used.
Studies in phases 2 and 3 are randomized and controlled, which means participants are randomly assigned to different groups so researchers can compare results and see how the new drug performs. Usually, participants don’t know whether they’re receiving the actual drug or a placebo, which helps keep the results unbiased.
During this phase of testing, a trial’s study protocol outlines how researchers will measure whether a drug works, explains Dr. Hernandez. Researchers track specific goals, called “endpoints,” by collecting data from both the treatment and control groups to compare results. For example, a diabetes drug would be considered effective if it lowered hemoglobin A1C levels more than in the control group.
Sometimes, though, measuring these clinical outcomes can take too long. For example, Dr. Hernandez explains that it can take years to know whether a drug can lower the future risk of a heart attack, far longer than the length of a typical clinical trial. In these cases, trials often use “surrogate endpoints” as substitutes. So, instead of waiting to see if the drug prevents heart attacks directly, researchers may measure cardiovascular biomarkers to tell if a drug has benefits for preventing heart attacks.
Phase 2 may last up to 2 years and include several hundred individuals with the disease or condition this new medication is designed to treat.
On average, about 1 in 3 INDs progress past phase-2 trials.
FDA Clinical Trials: Phase 3, Large-Scale Testing
Phase 3 trials consist of multiple studies conducted across various health centers (hospitals, academic research centers, specialized clinics, etc.) involving 300 to 3,000 participants who have the disease or condition the drug is designed to treat.
These studies are designed to confirm earlier efficacy findings as well as uncover more in-depth information about variations in drug response (i.e. how different individuals react to the drug).
Rare adverse events are more likely to be found during these larger trials, but Dr. Hernandez points out that even with thousands of participants, they might still be missed. “If a rare side effect only occurs in one or two patients, it may go unnoticed,” she says, noting that tens of thousands of people might need to take the drug before it’s identified. If an adverse event starts happening in a bunch of people taking the drug during this phase, the “safety signal” becomes strong enough to get picked up, she further explains.
The data collected during phase 3 is crucial in determining the guidance and directions in the package labeling (or insert). Possible findings during this phase may lead to important drug information, such as dosing adjustments, contraindications, and warnings or precautions. In addition, the reported adverse effects during these trials are included in the drug’s labeling, informing patients and prescribers about what side effects may occur and how likely they are to happen.
Phase-3 clinical trials last up to four years. Trials are generally considered successful if clinical endpoints are met (meaning more people in the treatment group had the desired effect compared to those in the control group).
Upon completion of phase-3 trials, a company may pursue FDA approval.
Post Clinical Trials: FDA Review and Approval of New Drugs
The approval process begins when a pharmaceutical company submits a new drug application (NDA) to the FDA. “The NDA should tell the entire life story of the molecule, from preclinical studies through phase 3,” says Dr. Hernandez. The company also needs to provide details on how they plan to manufacture the drug in a dosage form that’s safe and reliable, she notes. FDA inspectors will visit the manufacturing site. The FDA is also involved in deciding what information is included in the package insert if approved.
Approval is generally based on whether the new drug’s benefits outweigh its potential risks, but Dr. Hernandez notes that risks are weighted differently depending on what it’s intended to treat.
In general, medications for healthier people, such as vaccines, must meet a higher safety standard to gain FDA approval.
In certain cases, an independent advisory committee of experts in the therapeutic area and consumer representatives is formed to review the NDA. (Medshadow’s founder, Suzanne Robotti, is currently the appointed consumer representative on the Drug Safety and Risk Management Advisory Committee.)
This committee assesses the drug and votes on whether it should be approved. Review teams within CDER and CBER consider the advisory committee’s recommendation, but ultimately, CDER and CBER are responsible for the final decision.
The average FDA review time for standard NDAs is 10 months, but some drugs can be pre-selected for expedited approval. There are multiple paths for this, but the purpose of each is to make therapies available quicker in areas with unmet medical needs. For people with progressive or life-threatening diseases, a quicker time-to-market is understandably important.
The majority of drugs approved by the FDA in the last two decades have come through an accelerated path. Drug companies likely find this desirable since it allows them to market their new drug earlier, often based on preliminary findings alone. Approval in these cases is contingent upon the drug company completing confirmatory trials to verify that the drug actually benefits the people taking it.
Post Clinical Trials: Phase 4, Surveillance
Phase 4 continues as long as the drug is on the market. The FDA may require the drug company to sponsor a formal phase-4 study during the post-marketing period. These studies are typically larger, longer, and conducted as observational studies without control groups. The information garnered may provide important insight in how effective and safe a drug is over the long-term—and importantly, under “real-world” conditions.
Drug companies must annually report their phase-4 study findings of a new drug. However, post-marketing surveillance requirements are often vaguely defined. What’s more, some research findings show even when phase-4 studies are clearly required, they’re often not completed and reported in a timely manner, possibly exposing more individuals to taking drugs where the benefits don’t outweigh the risks.
Whether a drug receives a phase-4 study or not, the FDA continues to monitor public databases that collect reports of possible adverse events. These include MedWatch and the FDA’s Adverse Event Reporting System (FAERS), along with its counterpart, a Vaccine Adverse Event Reporting System (VAERS).
The FDA will also review published case reports or electronic medical record studies that may link a new drug to certain outcomes. More recently, the FDA launched its Sentinel database, which draws information from private and public healthcare-affiliated institutions to monitor drug safety.
If any safety issues surrounding the new drug are noted, they may be escalated based on the evidence, and may lead to drug labeling changes. In fact, about one-third of post-market safety issues are added to the warnings and precautions section of a drug’s labeling. Additionally, most evidence that leads to a drug’s boxed warning (the FDA’s most serious type) is collected during the phase-4 period.
Why Clinical Trials May Not Protect You From Side Effects
Whether or not you’ll experience a side effect from a recently approved medication is not always reliant on clinical trial data.
“In a clinical trial, we have a perfect patient population that’s been hand-selected, but that’s not real life,” Dr. Hernandez explains. In a real-world setting, she notes, clinicians may prescribe a new drug to patients with conditions not studied in the clinical trials, a practice known as “off-label” use. Additionally, the patient care and monitoring during a clinical trial are unlikely to be the same outside of a clinical trial.
The diversity of the participants included in a clinical trial may also affect the likelihood of certain people experiencing unexpected side effects. Poor representation means a safety signal may not be large enough to detect. Despite FDA’s pushes for more inclusive clinical trials, historically understudied racial and ethnic groups remain underrepresented. Older and younger age groups, and individuals who are pregnant or nursing, are also less likely to be included in clinical trials.
“Whether or not you’ll experience a side effect from a recently approved medication is not always reliant on clinical trial data,” explains Dr. Balani. “Having studies done on a subset of patients may not directly correlate 100 percent of the time with what can happen with the others.”
If a patient asks Dr. Balani about taking a newly approved drug, she digs into data based on their particular characteristics. Then, she’ll say, “Based on your characteristics, this is what I can tell you about it.”
Additionally, some research suggests that prescribers and pharmacists believe FDA approval creates a higher level of confidence about a new drug’s safety and efficacy than may be warranted. So it’s important for consumers to ask questions and understand the possibilities of unknowns when considering whether a new drug is right for them or a loved one.
Questions to Ask Your Doctor When Deciding on a Newly Approved Medication
Consider discussing the following questions with your prescriber when deciding on a newly approved medication:
- Is this a first-in-class drug, or are similar medications already in use and well tolerated?
- Has the drug been studied in people with my characteristics (i.e. age, racial or ethnic background, medical conditions, and other factors that may affect how your body responds to taking it)?
- What are the benefits of taking this medication? How does it compare to older drugs used to treat my condition?
- Are there any effective non-medication approaches worth considering?
- Will any of my medications interact with the new medication?
- What are the tradeoffs of starting this new medication now versus waiting until reassuring post-marketing data becomes available?
Dr. Balani encourages her patients to reach out for any possible signs of a side effect, even if it’s not a known side effect. This allows her to forward the information to the appropriate agency for post-marketing surveillance.
Clinical trials are the cornerstone of new drug discovery, bringing life-improving and life-saving medications to the market. While a robust safety monitoring system is in place to protect participants during trials and post-approval, further improvements — particularly in trial inclusivity and phase-4 research — are essential to safeguard against medication side effects and enhance overall patient safety.
