How much does Drug Approval cost?

[Vocalek]

http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=2010_register&docid=fr04au10-70

Fee revenue amounts for applications, establishments, and products are to be established each year by FDA so that one-third of the PDUFA fee revenues FDA collects each year will be generated from each of these categories. This notice establishes fee rates for FY 2011 for application fees for an application requiring clinical data ($1,542,000), for an application not requiring clinical data or a supplement requiring clinical data ($771,000), for establishment fees ($497,200), and for product fees ($86,520). These fees are effective on October 1, 2010, and will remain in effect through September 30, 2011.

Remember, this is just the fee paid to the FDA. This is not the cost of actually conducting research to develop the product, conducting animal testing, conducting clinical trials, etc.

 

[Stownz]

Would be nice for most of the juice suppliers to even do a single lab test. With the prices they are charging, they could at least send out a few to be tested. Not to mention testing every single flavor, and the individual batches of PG VG and Nic as they are reseived. We can't get them to even do that, much less band together to split the cost of the FDA approval costs.

 

[mostlyclassics]

Stownz, the FDA fee is a very tiny part of what it costs to test something to the point of filing an NDA. You're also looking at years and years plus tens to hundreds of millions of grickles going through phase I, phase II, phase III (and sometimes IIIa and IIIb).

Here's an example of the whole process and the time and money it takes, just for CE Mark approval in Europe, which is much less expensive and easier to obtain than FDA approval for a new medical device or drug.

Cytosorbents Corporation was founded in 1997. They essentially have been developing one product, a blood filter using resin microbeads carefully engineered to remove only substances within a certain range of molecular weights from blood. To simplify the approval process by a factor of ten, they decided early on to make their microbead-containing cartridges plug-and-play compatible with existing dialysis machines. Otherwise, they'd have to develop and get approval for the machine as well. To further simplify the approval process, they decided to only filter out the kind of immune-system produced chemicals which are the actual killers in cases of sepsis and septic shock, in their first product. In all, their product design decisions and restriction of goals to one simple, easy to analyze situation, has reduced the cost of development and approval by easily a factor of 20.

By 2006 or so, they had a prototype and started testing. They finally finished the last phase of testing in Europe a month or so ago. They immediately received European CE Mark approval, based on preliminary results. They are only approved to sell their devices for hemoadsorbtion in cases of septic shock and sepsis, nothing else. They'll publish the final studies later this year and plan to start selling in Europe starting in 2012. They may have enough profits from sales to start designing the tests for the FDA by 2014. Going through the whole FDA process to obtain approval to sell here will probably take four to seven years.

As of March 31, 2011, Cytosorbents Corporation had burned through $85,945,000, according to their balance sheet. Keeping the company running in extremely lean mode (they only have six paid employees) has consumed about 15% of that. My guess is that development of Cytosorb consumed about 50%; the remaining 35% was the expense of the CE Mark trials. FDA approval will probably cost $100,000,000 to $150,000,000.

Have you ever wondered why newly developed drugs and treatments cost so much?

 

[mostlyclassics]

By the way, that's for ONE type of microbeads in ONE type of cartridge approved for essentially ONE type of medical problem.

In the case of e-liquids and our delivery system hardware, you're talking about thousands of different e-liquids tested each across maybe about 100 different delivery systems to get FDA approval. The mind boggles with what it would cost . . . probably more than the figure represented by the national debt of Greece.

In my opinion, having the heavy hand of the FDA involved in PVs and e-liquids is definitely not the answer.

Possibly it would make sense for a private lab to develop various tests. Then the manufacturers could send samples in for testing and get the private lab's mark of approval, something like Underwriters Labs for electrical devices.

 

[rothenbj]

Well explained Mostly. I don't believe any vendor would have seen the light of day if the FDA had got their way. At best, someone would have started the process under financed and, with any luck, someone would have paid them generously to buy them out or partner with them. 10-12 years later an under performing low nicotine product would have been approved, later brought to market with major fanfare from the ?non-profit?"health" associations and turned into a block buster with maybe a little better results than any of the NRT has seen to date.

You have to remember that part of the battle truly is replacing the hand to mouth which is why I'd expect a better result, but nothing like the free market has been able to accomplish.

 

[rolygate]

Here's some info on the cost of licensing a pharmaceutical in the UK.

The license fee payable to the MHRA (equivalent to the FDA) is about £28,000 (~$45,000). The cost of the cheapest possible trial is about $100,000 now, and this involves one researcher using lab equipment, plus the report / documentation fees, with no legal fees, assuming this is just a report and not a true product license application. The cheapest practical cost of a trial involving several people plus legal fees probably approaches $500,000. This is for a fairly simple trial, and where there is some pre-existing documentation that can be used.

A company with main street stores that was recently forced to license some herbal medicines as pharmaceuticals, due to successful pressure by the pharma industry in order to remove competitors, reported that it took 4 years and £750,000 ($1.2m) per product to obtain a license, and this was for products that had a safe 30-year usage history.

We are only aware of one e-cigarette vendor anywhere that has applied for a pharmaceutical license - one in the UK. So far it has taken this company two years of work and hundreds of thousands of pounds investment, and no license is as yet forthcoming.

Neither the community nor the industry want the medical licensing agencies (the FDA and MHRA) involved in any way with e-cigarette or e-liquid licensing. There is no possible need for it since these are consumer products, and since there is no medical evidence that harm can be caused. The nearest similar product is Snus, the Swedish oral smokeless tobacco, which has 25 years of data proving that a Snus user has the same risk as any other ex-smoker. Alternative tobacco products are not medicines.

However, there are justifiable questions to be asked as to whether somebody somewhere should be looking at materials quality control and analysis - just as long as it is not the medical authorities.

 

[randyith]

Would be nice for most of the juice suppliers to even do a single lab test. With the prices they are charging, they could at least send out a few to be tested. Not to mention testing every single flavor, and the individual batches of PG VG and Nic as they are reseived. We can't get them to even do that, much less band together to split the cost of the FDA approval costs.

Do you know how much a certificate of analysis cost on flavorless liquid nicotine? Try $400 for the cheapest. Do you know how much it costs for PG and VG? Try $275. And you want it for every batch? Every flavor? Every ingredient? So you don't mind paying $79 instead of $38 for a gallon of PG? Most people buy the cheapest price here. The cost of certificate of analysis raises prices by 30 to 50%. I run full certificate of analysis tests but not on every batch. Do you know that it is illegal in the USA to furnish a generic certificate of analysis to a retail customer for a previous batch? You have no idea how much this adds to costs and I bet you would not pay the additional costs.

For instance Halo, IMP makes the best tobacco e-juice on the maket but it is $20 for 30 ml instead of $10. I read on a thread at this forum about a vendor going out of business his sale of Halo inventory for $10 and the long list of posts from people saying they always wanted to buy it but they could not justify the costs. Halo has the tests you want but let me ask you do you pay $20 for a bottle of e-juice. I do. Most don't. My point is you act like these vendors are making millions or hundreds of thousands of dollars per year when they are actually operating on slim margins.

You have no idea what you are talking about.

 

[rolygate]

As Randy says, GC-MS testing is expensive.

The main problem is: what exactly to test? The base material? The finished product? If you test the base material (PG and VG with nicotine) then you will know that is OK, but you don't know what is added later, as the flavorings suppliers might be including anything. But if you test the finished products, you have dozens or hundreds of specimens to test.

I don't know of anyone who is doing wide-scale testing of finished products (all the different e-liquid flavors) because it is too expensive even for the high-volume vendors. However I do know of a couple of big vendors who test all their base materials batches, and it costs them about $10,000 a month. They have an annual turnover of over $10m so it is practicable for them, it may not be for anyone else.

It should be possible for most vendors to do occasional sample testing, that is to say, pick one finished flavor and test it, then a different one next time. In fact this is the only reasonable way to do business as selling products for long-term high-volume inhalation that you have no idea what is in them is neither correct morally nor probably legally, since there is potential for damage.

What will certainly need to happen for this to take place, though, is that people will have to accept a higher price for their liquid. The current cut-price war on liquid serves nobody. You get the cheapest liquid - but you get exactly what you pay for. Nobody knows what is in it, and I certainly have evidence that in some cases there has been some nasty stuff in there caused by choosing the lowest possible cost or by choosing products made by people who basically don't know what they are doing.

If you are at all concerned about what you are vaping then try and find a vendor who tests their materials and publishes the GC-MS results on their site, or who is known to make it in an approved laboratory. Some people have moved to vaping unflavored base only, partly because of this issue.

If buyers put pressure on suppliers to sell liquid at the cheapest possible price, then they will get what they deserve.

 

[Stownz]

Do you know how much a certificate of analysis cost on flavorless liquid nicotine? Try $400 for the cheapest. Do you know how much it costs for PG and VG? Try $275. And you want it for every batch? Every flavor? Every ingredient? So you don't mind paying $79 instead of $38 for a gallon of PG? Most people buy the cheapest price here. The cost of certificate of analysis raises prices by 30 to 50%. I run full certificate of analysis tests but not on every batch. Do you know that it is illegal in the USA to furnish a generic certificate of analysis to a retail customer for a previous batch? You have no idea how much this adds to costs and I bet you would not pay the additional costs.

For instance Halo, IMP makes the best tobacco e-juice on the maket but it is $20 for 30 ml instead of $10. I read on a thread at this forum about a vendor going out of business his sale of Halo inventory for $10 and the long list of posts from people saying they always wanted to buy it but they could not justify the costs. Halo has the tests you want but let me ask you do you pay $20 for a bottle of e-juice. I do. Most don't. My point is you act like these vendors are making millions or hundreds of thousands of dollars per year when they are actually operating on slim margins.

You have no idea what you are talking about.

I mix my own, have since I got sick of the prices over a year ago. Never knew how much they were marking up the juice, until I started sourcing my own supplies. If someone else can gamble with ingredients then so can I. Marking up .10 cents worth of juice up to $30 is what bugs the hell out of me. There is NOTHING to support that kind of behavior from the huge majority of juice suppliers out there. Nothing turns over the profits like the #1 consumable in vaping: e-juice. Without proof, there is just a large collection of suppliers spewing claims with no proof, and gouging people for it. Exactly what is the difference between me ordering a gallon of nic from china, some flavoring in bulk, and mixing the stuff in my garage, and what 90% of these juice suppliers are doing? I'm not selling the stuff I mix in my garage with no tests on base nor finished mixes. Suppliers want us to just trust them because they say so? Because they bought some liquid in a bottle that had "USP" printed on it? Because all of the bottles they used to mix a recipe with said "USP" on it?

Yes, testing is expensive. So is the mark up on the juice on the market. Small suppliers may operate on small margins, but they will operate on 0 margins when the FDA gets ahold of a bottle of their "USP" juice.

The FDA already grabbed up a few of the china samples, and look what that did to the industry? There wouldn't be so many of these super small juice companies popping up if it wasn't so easy to lowball that huge markup.

ANY testing, or ANY batch sure would be preferable to NONE. In the end though, it is exactly as I stated: every flavor, every batch. If your going into the business of supplying something people are vaping into their lungs, some accountability should be considered. If your not ready for that responsibility, and the costs, then don't sell it. People trust the suppliers, they trust it is not some guy mixing stuff in his basement or garage with some random bottles of stuff labled "USP Grade" shipped straight from china. This is all a broad generalization of the industry, not everyone is price gouging on imported materials, but the majority is.

I would gladly accept higher prices, if the testing was being done on a consistent basis. As it stands right now, I'll mix my own for next to nothing compared to what is being charged by these little e-stores.

One gaurantee is coming: The FDA will start testing, and we have already seen what a quality job they have done so far. At that point, it really won't matter what the cost was will it?