As negotiations for PDUFA V get serious, there seems to be a widening gap between what FDA wants (more resources) and what industry wants (more predictability).

Of course there are many, many other things – all of them important (and the devil is certainly in the details), but it’s the conjoined issues of resources and predictability that is driving the debate.

PDUFA V is turning into a battle over first principles. And it’s about time.

Industry has turned the corner relative to a well-funded FDA. Regardless of whether or not some members of the 112th Congress believe that the agency should receive less funding, a well-funded FDA is in the best interest of the both the public health and a robust biopharmaceutical industry.

A properly funded FDA will be able to do more things with greater ability and alacrity. And this will help to bolster the agency’s reputation with the public, thought leaders, and elected officials. And, as research has demonstrated, a well-regarded FDA leads to greater trust in the safety and efficacy of the products it regulates. A properly funded FDA will be able to more aggressively pursue the 21st century regulatory science so essential for 21st century drug development. The Critical Path doesn’t come cheap – but it’s worth it.

Better, more current, and predictable scientific research and standards must be developed and devoted to streamlining the critical path. Investment in basic research is not enough. New development tools are needed to improve the predictability of the drug development cycle and to lower the cost of research by helping industry identify product failures earlier in the clinical trials process.

Some 25 years ago, the success rate for a new drug used was about 14 percent. Today, a new medicinal compound entering phase 1 testing—often after more than a decade of preclinical screening and evaluation—is estimated to have only an 8 percent chance of reaching the market. For very innovative and unproven technologies, the probability of an individual product’s success is even lower. We have got to work together to turn that around.

When Thomas Edison was asked why he was so successful he responded, “Because I fail so much faster than everyone else.” Consider the implications if FDA could help companies to fail faster. Using the lower end of the Tufts drug development number ($802 million):

* A 10 percent improvement in predicting failure before clinical trials could save $100 million in development costs.

* Shifting 5 percent of clinical failures from phase 3 to phase 1 reduces out of pocket costs by $15-$20 million.

* Shifting of failures from phase 2 to phase 1 would reduce out of pocket costs by $12-$21 million.

There’s plenty the FDA can do with more money, but nothing's going to happen unless there’s some give to the take. There are different dimensions when it comes to “predictability.” Of course, there’s the “PDUFA date” deliverable–the driving force behind the user-fee concept in the first place. That’s broken.

Then there’s the predictable and reportable allocation of funds. That’s absent. There’s a lack of consistency in agency decisions within the same therapeutic category, a poverty of best science practices that can be used to both develop and review drugs, a frightening lag relative to best practices in qualified methodologies, and a dearth of common data elements and standards.

That’s for starters.

(Other items include biomarkers, REMS, a less byzantine diagnostics development and approval pathway, social media guidance, DTC and DDMAC issues, FOB pathway and bioequivalence, clinical trial design, development and use of non-US data, safe use, early risk communications and building an effective and proactive safety surveillance system, pediatric exclusivity, orphan disease drug development, paperless labeling, stakeholder engagement, EU harmonization, enhances transparency and communication, etc.)

It’s in this context that you have to consider the FDA’s proposed four-stage review cycle that would allow the agency to suspend the review clock in mid-review to address application problems and amendments (the infamous “time out” provision) as well as the issue of “non-binding advice.”

It would be useful for the 112th Congress to clarify some of the limitations on FDA’s authority to command the payment of user fees. For example, there’s an increasing number of cases where FDA has been gaming the system by threatening to delay the review clock start date until a sponsor agrees to an additional user fee for each “data set” included in a supplemental application–contrary to guidance.

There are some rogue elements within industry that are ready to discuss the “nuclear option” – no PDUFA fees at all. Why pay for the privilege of regulatory ambiguity? Why reward a lack of consistency? After all, they say, how much worse could it get? Well–the answer is “a lot worse.” But the fact that this is even being discussed points to the need to return to first principles. And the very first principle of PDUFA is predictability.

Industry seeks clarity. They want bright lines. They want to know the rules. They want predictability. This may sound simple and fair, but inside the FDA it has proven to be a fractious bureaucratic kulturkampf. “Change is not required,” as management guru W. Edwards Deming once said. “Survival is not mandatory.” And that doesn’t mean change for show, for politics–it means thoughtful, timely, strategic change that enhances the public health. And that kind of change requires not walking on egg shells–but breaking them.

Peter J. Pitts is president of the Center for Medicine in the Public Interest and a former FDA associate commissioner.