Jihye Han Compares First-In-Class Drug Regulation in the US and Europe

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Health Affairs' Senior Deputy Editor Rob Lott interviews Jihye Han of Brigham and Women's Hospital and Harvard University on her recent paper that takes a closer look at the regulatory treatments for first-in-class drugs and how those differ between the US and Europe.

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Episode Transcript

Rob Lott (00:31):
Hello, and welcome to A Health Odyssey. I'm your host,
Rob Lott. It's not always bestto be first. When it comes to
drug development, for example,there's a lot more risk
associated with developing socalled first in class drugs

(00:53):
compared to simply making smalltweaks over the same kind of old
drug. After all, we just don'tknow as much about how first in
class drugs work in practice andover time.
We can't predict all thesurprises that might arise as
they're tested and marketed.These disadvantages create a
disincentive for first in classdrug development. Why try

(01:16):
something new and risky if you'dhave more certainty by taking
only small, more incrementalsteps? So to incentivize more
innovative drug development,policy makers and regulators
have tried to smooth the wayforward for first in class drug
development. They have done thisby applying significant
regulatory flexibility to firstin class drug applications,

(01:40):
often shrinking the review timeor accepting less exacting types
of clinical trials for approval.
This approach makes it easier tobring a drug to market, but
there's a trade off in the formof an entirely new kind of
uncertainty. That is, we haveless information about a drug
that's benefited from thisflexibility and therefore may be

(02:03):
less confident about its truereal world effectiveness. Trade
offs such as these areinevitable, but what we don't
really know is whether ourapproach to these trade offs is
uniquely American. Do regulatorsin other countries make the same
calculation, or are we taking ongreater risk and allowing for
less certainty in The UnitedStates? That's the topic of

(02:26):
today's health policy.
I'm here with doctor Jihae Han,a research specialist with the
program on regulation,therapeutics, and law at Brigham
and Women's Hospital. Along withher coauthor, doctor Erin
Kesselheim, doctor Han has a newarticle in the March 2025 issue
of Health Affairs. Its title isalso its main finding, quote,

(02:51):
first in class drugs experienceddifferent regulatory treatment
in The US and Europe. I amreally very excited to learn
more about it here today. DoctorJie Han, welcome to A Health
Odyssey.

Jihye Han (03:04):
Yeah. Thank you for having me. It's great to be
here.

Rob Lott (03:07):
So let's start with just a a little quick
background. What do we mean whenwe use the term first in class
drugs, and why is it importantto study them as a different
category from drugs in general?

Jihye Han (03:20):
Yeah. Thanks for asking that question. So first
in class drugs are what theysound like. They are the first
of their kind. They introduce anew mechanism of action that
wasn't previously used inexisting treatments.
So at the time of approval, theyrepresent something
fundamentally different fromexisting treatments, although
they may target diseases thatalready have FDA approved
treatment

Rob Lott (03:39):
options that use

Jihye Han (03:39):
a different mechanism of action. Approved treatment
options that use a differentmechanism of action. So in other
words, they work in a new way,but that doesn't always mean
that they are the firsttreatment for a disease. So back
in 2013, FDA researcherspublished a paper in health
affairs categorizing new drugsbased on their level of novelty.

(04:02):
They defined the first in classdrugs as those targeting a new
pathway.
Other new drugs were classifiedas advancing class, meaning that
they used a similar mechanism ofaction as an existing drug, but
improved safety or efficacy insome way or addition to class,
which provided another optionwithout necessarily adding

(04:23):
advantages over existingtreatments. So in this way,
first in class drugs are oftenconsidered the most innovative
category of new drugs. But oneinteresting thing about first in
class drugs is that they alsocome with a lot of uncertainty.
Since these drugs work via newmechanisms, there's not the same

(04:45):
prior clinical experience toprovide us with a hint about how
they will perform in routineclinical use. So I think that's
why studying first in classdrugs separately is important.
Firstly, from a clinicalperspective, it is important for
physicians and patients tounderstand the quality of
evidence behind these drugs sothey can make informed treatment

(05:09):
decisions. Secondly, from aregulatory and policy
standpoint, studying first inclass drugs helps us assess the
extent of regulatory flexibilityapplied to drugs that are
considered highly innovative buthave important uncertainties
about their safety and efficacy.

Rob Lott (05:26):
Okay. So you used the term regulatory flexibility. I
mentioned that in theintroduction as well. Just
trying to wrap my head aroundthat idea. Can you provide some
examples of what it looks likewhen the FDA provides, quote,
regulatory flexibility?

Jihye Han (05:44):
Yeah. So FDA's regulatory initiatives target to
promote pharmaceuticalinnovation. And one example is
the expansion of expeditedprograms to facilitate the
introduction of drugs addressingunmet medical needs. These
programs offer different typesof flexibility, including
shortening the FDA's officialreview date timeline, allowing

(06:08):
approvals based on surrogatemeasures instead of clinical
outcomes and permitting rollingsubmissions of data. Because
first in class drugs introducenew mechanisms of action, they
are very likely to fall into oneof these expedited pathways,
especially when they traceserious conditions with no
existing treatment options.

(06:28):
Our study actually, showed thateighty one percent of first in
class drugs approved from 2013to 2023 were designated with at
least one of the four expeditedprograms in the FDA. And another
way to look at regulatoryflexibility for first in class
drugs is clinical trial design.Since 1998, when FDA published a

(06:53):
guidance on evidence needed toestablish effectiveness, the
preference has been for twopivotal trials to reach the
substantial evidence statutoryapproval standard. But first in
class drugs often enteredAmerica with only one pivotal
trial, and that trial may be aphase two trial rather than

(07:14):
phase three or lackrandomization or control groups.
Even though this kind offlexibility helps bring novel
treatment to patient faster, italso increases uncertainty about
their safety and effectiveness.

Rob Lott (07:30):
Okay. So give me a sense. You you said often first
in class drugs will come tomarket with only, one trial, for
example, instead of two, or theymight use a surrogate, marker
instead of a, like, a clinicalendpoint. What are the reasons
that a first in class drug mightnot be able to kinda do two

(07:53):
trials or do a clinical,endpoint? Why do we even have to
give them that additionalflexibility?

Jihye Han (08:01):
Yeah. It's a it's a great question. So, clinical
outcomes as opposed to thesurrogate measures directly
measure a treatment's benefitssuch as whether patients live
longer, experience symptomrelief, or see improvements in
their condition. In contrast,surrogate matters or surrogate

(08:22):
endpoints like blood tests orradiological evidence are used
as a substitute to predictclinical benefits. In fact, some
surrogate markers have undergoneextensive validation and are
widely accepted as meaningfulindicators of clinical benefit,
like blood pressure forcardiovascular outcomes.

(08:44):
There are cases when clinicaloutcomes take too long to study
or where it'll be unethical torequire them in trials. That's
when surrogate endpoints can beuseful and also for the first in
class drugs. The FDA'saccelerated approval pathway
allows drugs to be approvedbased on surrogate markers only

(09:05):
reasonably likely to predictclinical benefit with the
expectation that post marketing,confirmatory trials will later
verify their actual impact onpatient outcomes. But surrogate
measures have receivedincreasing attention because
many drugs approved throughaccelerated opoprolol has have

(09:25):
delayed or, failed to confirmclinical benefits in post
marketing trials.

Rob Lott (09:32):
There's also some flexibility around things like
blinding and randomization too.Is that right?

Jihye Han (09:40):
Yeah. So for blinding and randomization, these are
also the key tools in clinicaltrial designed to reduce bias,
but a growing number of drugsare approved by the FDA based on
single arm designs or historicalcontrols, which inherently do
not allow for blinding andincrease the risk of bias. As to

(10:03):
first in class drugs, beingpharmacologically innovative
doesn't necessarily mean a drugis a true medical innovation. A
drug is clinically innovativeonly if it leads to meaningful
improvements in patientoutcomes, not just because it
has the potential to do so.That's why if a drug is approved
based on surrogate endpoints andlimited eventuaries per due to

(10:25):
clinical design flexibilities,tracking its clinical
performance is important,ensuring that the regulatory
flexibility doesn't come at thecost of patient safety and
effectiveness.

Rob Lott (10:38):
Okay. So let's dig into your paper. You, basically
tried to assess how widespreadthe the regulatory flexibility
is, and you compared theapproach in The United States to
Europe. What did you learn?

Jihye Han (10:54):
So we looked at three key aspects, refrigeration, use
of expedited regulatoryprograms, and the key
characteristics of pivotalefficacy trials for the first in
class drugs approved by the FDAduring the last decade, and then
we compared that, these picturesto the EMA. For the

(11:14):
refrigeration, we used the timeit took for, the drugs to be
reviewed at each agencies. Wealso compared the different
review times by expeditedprogram use. And for the trial
characteristics, we reviewed howmany studies supported approval
like study size and trial phase,presence of comparators,
blinding, and endpoints. Thefirst in class drugs are very

(11:38):
likely to go through expeditedprograms at the FDA.
We found eighty one percent usedat least one program compared to
only thirty percent in the EMA.In PIRG, due to this, expedited
program use, FDA review timeswere shorter, although the
differences were not very large.It was eight point one three

(11:59):
months in the FDA versus tenmonths in the EMA for the common
drugs in, in the two agencies.And in terms of the clinical
trial characteristics, nearlyhalf were based on surrogate
measures and around thirtypercent were approved without
blinding and control. And aquarter had no phase three trial

(12:21):
data when it is approved.
And for cancer drugs, aboutninety percent were based on
surrogate measures and openlabel trials.

Rob Lott (12:31):
Okay. Pretty interesting results there. I'd
like to hear more about, some ofthe details, which we'll talk
about when we return after thisbreak. And we're back. I'm here

(13:01):
with doctor Jieh Han, and we'retalking about her analysis of
first in class drugs and theirregulatory flexibility, they
experienced in The United Statescompared to Europe.
In particular, I understand youfound that, FDA review durations
varied by therapeutic area. Forexample, cancer drugs had

(13:23):
shorter review durationscompared to those for
musculoskeletal conditions. Howdo we explain that variation? Is
there a greater sense of urgencyaround cancer drugs or perhaps a
greater incentive for drugdevelopers to find ways to speed
up the process, or is there someother explanation altogether?

Jihye Han (13:44):
Yeah, it is an interesting point. So we found
that, the FDA's review timeranged from seven point seven
months for cancer drugs tofourteen point five months for
most cholesterol drugs. And wecan only speculate the
underlying reasons, but severalfactors may contribute to this

(14:06):
variation across differenttherapeutic areas. Firstly, I
think there is a heightenedsense of urgency surrounding
cancer treatments due to thesevere and life threatening
nature of the disease. This kindof urgency led to federal
initiatives designed, toaccelerate the approval process

(14:26):
of oncology drugs.
For example, the, the twentyfirst Century Cures Act
established the FDA's OncologyCenter for Excellence, which
introduced the real timeoncology review program to
expedite the review of newoncology drug applications. It
is also possible that, there isa strong financial incentive for

(14:50):
manufacturers to find ways toaccelerate the approval process
for oncology drugs because ofhigh price tag of, such drugs.
Reflecting this, cancer drugsmade up the largest proportion
of first in class drug approvalsin our cohort. And furthermore,
in 2024, oncology was top rankedin terms of clinical trials

(15:14):
towards according to the IQBAreport. And, historically,
studies looking at overall newdrugs have indicated that cancer
drugs undergo faster reviewtimes compared to any other
therapeutic areas.
And FDA has outpaced foreignregulatory agencies in reviewing

(15:36):
cancer drugs more than any otherdrug categories. While our study
didn't specifically, break downexpedited program use by
therapeutic area, we also foundthat 44 out of 46 cancer drugs
received priority review at theFDA, which shortens the FDA

(15:56):
official refrigeration from tenmonths to six months and which
likely played a role in theirshorter repeat times. So
collectively, I think thesefactors have made cancer drugs
one of the fastest movingtherapeutic areas in the FDA
approvals.

Rob Lott (16:12):
Okay. So what do these findings, tell us about the
different, expedited regulatoryprograms? Are they achieving the
goals in your eyes that we hadset out for them when they were
created?

Jihye Han (16:26):
So FDA's expedited program includes priority
review, accelerated approval,fast track, and breakthrough
therapy designation. And someof, some studies have found that
while these programs have spedup the overall approval process,
as we also observed in our studyon first in class drugs, they

(16:47):
haven't necessarily increasedthe number of new drugs
approvals or significantlyreduced total development times.
And, at the same time, theexpansion of expedited programs
has reduced the amount ofclinical evidence available at
the approval. However, the FDA'scommunication about these

(17:10):
evidence limitations remains,still very limited. Currently,
only accelerated approval drugsinclude this kind of information
in their labelling.
So, certainly, there is a needfor further research and
potential policy reforms toensure these pathways balance
speed with, the robust evidencegeneration.

Rob Lott (17:31):
Gotcha. So you're saying that, basically, my
doctor could prescribe a a drugfor me, and I I might not know
whether or not it kinda reachedthe market without as much
evidence as, as a typicallyapproved drug. Is that a fair
way to describe it?

Jihye Han (17:48):
Yeah. Yeah. So FDA publishes, annual report of new
drug approvals, and theydisclose all of the expected
program use for, each drug.However, it's not always easy
for patients and physicians toknow, to learn about those
information based on the modelof each drug.

Rob Lott (18:11):
Got it. Okay. Can you envision any changes to the
pathways that might remove someof the uncertainty they create,
or is that just an inherentpiece of the of the the the
bargain, if you will?

Jihye Han (18:26):
Yeah. As I just mentioned, there are, like,
concerns regarding the reducedamount of clinical evidence at
the time of approval. So toaddress these concerns, I think
postmakers could improvetransparency by clearly
indicating when a drug wasapproved through, one of the
expedited pathways and whatuncertainties could come with

(18:48):
it. This is important forphysicians and the patients like
us who make their treatmentdecisions in the face of these
uncertain Another area forpotential reform that I could
think of is, for the robustclinical evidence, in post
marketing confirmatory trials,particularly for accelerated

(19:11):
approval drugs. One study foundthat fewer than half of cancer
drugs approved through thispathway later confirmed benefits
and clinical outcomes, and manytrials delayed or failing to,
demonstrate expected benefits.
So strengthening theserequirements could better
balance regulatory incentivesfor innovative drugs with the

(19:34):
need to ensure safe andeffective drug use.

Rob Lott (19:37):
So, new drugs are expensive, typically, and I'm
wondering what we know about howpayers are responding, to the
combination of high prices andhigh uncertainty created by the
greater regulatory flexibility.And are there policy solutions
that maybe could be applied onthe payment side to potentially

(20:02):
improve both access to thesedrugs and maybe the certainty
around their effectiveness?

Jihye Han (20:08):
The public payers like Medicare in The US often
have to cover these drugs evenwhen the evidence is uncertain.
This can lead to a high spendingwith unknown benefits. In
contrast, other countries usehealth technology assessments to
make reimbursement decisionsafter approval. A study found

(20:30):
that around twenty six percentof first in class drugs approved
by the FDA received negativereimbursement decisions in other
high income countries because oftheir uncertain benefits or lack
of cost effectiveness. On theother hand, private insurers in
The US have more discretion andmay choose not to cover, high

(20:51):
priced drugs with uncertainbenefits.
They often implement coveragerestrictions and utilization,
management strategies like steptherapy, prior authorization, or
formulary exclusions for newdrugs due to concerns about high
cost and limited evidence ofefficacy. So as a prospective

(21:13):
policy option, payment modelsthat tie drug prices to clinical
uncertainty and the level ofsupporting evidence could help
mitigate financial risks forpublic payers in The US. For
example, this could includeperformance based payment models
or mandated higher rebates fordrugs approved without
confirmatory evidence until suchevidence is secured.

Rob Lott (21:37):
Got it. Okay. Well, before we wrap up, I did wanna
ask, my understanding is thatyou, used to work at a drug
company's, regulatory affairsoffice in Seoul, South Korea.
Yeah. Then you then you came toThe United States, where you've
really zeroed in on The USregulatory process.

(21:58):
And I'd love to hear a littlebit about how The US system in
your experience, has maybesurprised you or presented an a
new picture of, regulateregulation compared to your
experience in South Korea and,and looking at other nations
around the globe?

Jihye Han (22:19):
Yeah. Thanks for asking this question. So one
significant distinction in TheUS system compared to the any
other system or the word is thedisconnection between drug
pricing and the regulation inThe US. So in other countries,
reimbursement decisions assesswhether a drug offers sufficient

(22:41):
value to justify its price andwhether the health system can
afford it with limitedresources. So both approval and
reimbursement decision are thecritical steps in drug access.
Studies have, consistently shownthat the majority of new drugs,
including first in class drugs,are first launched in The US

(23:03):
before any other country. Thismakes The US the first to face
uncertainty in terms of safetyand effectiveness. Even so, in
The US, clinical uncertaintyincreased by regulatory
flexibilities is combined withand conveyed as financial risks
to payers and patients due to,like, an effective regulation on

(23:24):
drug prices. So I think USPolicymakers may want to manage
policies that incentivizeinnovation by directing
resources only to drugs thattruly address this needs. And
focusing on, the pharmaceuticalpolicy in US has influenced my
perspective on health system invarious ways.

(23:47):
However, my transition fromindustry to academia has more
significantly changed the way Ilook at regulatory incentives
and the value of new drugs asthey are rather than shifting my
view on different systems. I'vebecome more focused on, public
health and resource allocationperspective and its, broader

(24:08):
societal impact rather than justthe value of drug itself. And
regarding other systems,different challenges also arise,
such as submission or approvaldelays compared to The US due to
the lower incentives fromexpected revenues and limited
coverage of new drugs inherentin, the social insurance or

(24:30):
taxpayer funded systems.Therefore, a careful but very
different balance in each systemis needed between increasing
incentives for drug developerswho will bring innovation and
ensuring safe, equitable, andalso affordable access to
medicines, which needs furtherstudy.

Rob Lott (24:52):
Wow. What a great, point to end on, doctor, Jie
Han. Thank you so much fortaking the time to chat with us
today.

Jihye Han (25:00):
Thank you so much for having me and asking great
questions. It was my pleasure tobe here. Thank you.

Rob Lott (25:06):
And to our listeners, thanks for tuning in. If you
enjoyed it, please tell afriend, smash that subscribe
button, and tune in next week.Thanks for listening. If you
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health policy.