Why Does the FDA Overrule Its Expert Committees’ Recommendations?

32 Pages Posted: 22 Jul 2019 Last revised: 9 Sep 2021

See all articles by Joseph H. Golec

Joseph H. Golec

University of Connecticut - Department of Finance

James C. Cooper

George Mason University - Antonin Scalia Law School

Date Written: September 8, 2021

Abstract

The Food and Drug Administration (FDA) creates committees of experts who recommend whether new drugs should be approved or rejected. The popular press and earlier studies commonly report that the FDA almost never overrules these recommendations. Some argue that the experts and FDA are like-minded because both have financial ties to drug companies. Others claim that both are risk averse and avoid approving effective but risky drugs. We show that FDA overrules are more common than some believe (16 percent of cases) and that experts’ risk aversion better explains overrules than their financial ties to drug companies. The recent controversial overrule for Alzheimer’s drug Aduhelm illustrates how the FDA is willing to take the risk of approving a drug that the experts almost unanimously reject. This is consistent with our finding that committees with top experts reject more drugs, perhaps to protect their reputations.

Keywords: FDA, Drug Advisory Committees, Drug Approval Process, Drug Regulation

JEL Classification: I18, I10, I11, H51

Suggested Citation

Golec, Joseph and Cooper, James C., Why Does the FDA Overrule Its Expert Committees’ Recommendations? (September 8, 2021). University of Connecticut School of Business Research Paper No. 19-15, Available at SSRN: https://ssrn.com/abstract=3423007 or http://dx.doi.org/10.2139/ssrn.3423007

Joseph Golec (Contact Author)

University of Connecticut - Department of Finance ( email )

School of Business
2100 Hillside Road
Storrs, CT 06269
United States

James C. Cooper

George Mason University - Antonin Scalia Law School ( email )

3301 Fairfax Drive
Arlington, VA 22201
United States
703-993-9582 (Phone)

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