According to a survey by the National Venture Capital Association’s Medical Innovation & Competitiveness Coalition, VC firms are decreasing their investments in biopharmaceutical and medical device companies and shifting investment away from the U.S. towards Europe and Asia. The statements came as part of a survey of 156 of NVCA’s member firms. Of the respondents, 39% of firms decreased investment in life sciences companies over the last three years and the same percentage expect to further decrease investment over the next three years.

The survey found that FDA regulatory challenges were most frequently cited as having a significant effect on venture capital investment trends. [See "Blame it on the FDA"]

Blame the FDA? It’s a convenient excuse when sponsors aren’t transparent about their interactions and communications with the agency.

For example, upon receipt of a Complete Response Letter, many companies issue public statements to the effect that, “We were shocked! The FDA never said there were any problems. We were most definitely expecting product approval.”

Some companies will blame the FDA with excuses like, “The FDA won’t allow us to discuss the letter” or “The FDA will be upset if we release the letter.” Hogwash.

But when you read the FDA Complete Response Letter, that’s not quite the reality of the situation. But, since Complete Response Letters (and all FDA-sponsor communications) are confidential, sponsors rarely (if ever) share them with the media or, for that matter, the investment community. Why is that?

Might it be that sponsors make mistakes and that there is (de minimis) blame to be shared? Might it be that companies sometimes try to game the system (accelerated approval issues come to mind) and fail? Blaming the FDA when corporate strategy flounders is convenient when the agency cannot release any information in its own defense.

Might Complete Response Letters be made public? Consider this statement by FDA Commissioner Hamburg, when she was asked whether FDA is discussing unilateral disclosure of information about drug development programs even if a sponsor objects:

“It’s a discussion that we’re having, and I think it’s a partnership working with industry. We need to move in directions that make sense, that will have value added, and where everyone understands the expectations and the opportunities.”

Here it is straight from the Bob Temple, Deputy Center Director For Clinical Science of the FDA’s Center for Drug Evaluation and Research and Acting Director of the Office of Drug Evaluation:

“If I were a reporter, I would say, ‘If you don’t show me the letter I don’t even want to talk to you.’ That’s what I would say.”

Wisdom of Temple or Temple of Wisdom, no matter how you slice it, it equals the FDA’s strong support for transparency.

Blame the FDA? Perhaps. But the fault, dear Brutus …

Peter J. Pitts is President of the Center for Medicine in the Public Interest and a former FDA Associate Commissioner