HHS Budget Hearings Offer Rare Opportunity to Reform FDA

When the President recently released his proposed budget for fiscal year (FY) 2027, pundits and politicians focused on everything from the surge in defense spending to National Science Foundation and Environmental Protection Agency cuts. Buried in the pile of federal agencies’ budget justifications was a key proposal that would change the way that medications are evaluated and approved in the U.S.

And now, members of the House Energy & Commerce Committee and the Senate Finance Committee are poised to take a close look at this and other provisions within the Department of Health and Human Services’ purview as part of the budget hearing process. Lawmakers must push the HHS and subagencies such as the Food and Drug Administration (FDA) to embrace commonsense reforms that would expand patient choice.

Hiding on page 26 of the FDA’s FY 2027 budget pitch is a proposal to “Create a new Clinical Trial Notification Pathway to Serve as an Alternative to the Burdensome Existing Investigational New Drug Pathway to accelerate drug development timeline to Make America Healthy Again.” This jargony mouthful would, if implemented, make it far faster and easier to get innovative new medications in the hands of patients.

The FDA’s obscure proposal is a long-overdue response to a pressing problem. As the agency notes, “The U.S. has longer timelines and a greater regulatory burden [for beginning drug testing in humans] because of the preclinical work and investigational process” which consists of “duplicative and time-consuming requirements.” The key hurdle in the U.S. is the mandatory and centralized preclinical and clinical review required under the Investigational New Drug (IND) process administered by the FDA. Before a first-in-human trial can begin, sponsors must compile extensive toxicology, pharmacology, and manufacturing data and submit it for FDA evaluation, triggering a mandatory 30-day review period.

This review occurs in addition to Institutional Review Board (IRB) approval, creating a redundant process that often brings progress to a screeching halt. Regulatory compliance attorney and industry expert Lauren Hartsmith explains, “no study-specific activities may begin before the IND is in effect and an IRB has reviewed and approved the research. This means study-specific activities such as advertising, eligibility screening, and seeking informed consent are prohibited during the 30-day IND hold. The IND waiting period can be particularly challenging in Phase I research, where timelines are especially tight.”

There is a far better approach to drug trial regulation than the current rigid model. The best example is Australia’s system, which places far fewer upfront regulatory hurdles on sponsors using the Clinical Trial Notification (CTN) pathway. Instead of requiring a national regulator to sign off before beginning first-in-human trials, Australia delegates scientific and ethical review to local Human Research Ethics Committees (HRECs) and trial institutions, with Australia’s FDA counterpart (the Therapeutic Goods Administration) serving largely an administrative role at the outset. As a result, manufacturers of treatments for everything from hair loss to colorectal cancer can get the green light to start human trials in weeks. Meanwhile, China has made strides toward decentralizing their own clinical trial system, and low labor costs have made the country an increasingly attractive destination for early-stage biopharmaceutical research. It’s little wonder that Chinese clinical trial volume is beginning to surpass the U.S., and American policymakers are increasingly worried about falling behind.

The U.S. can reclaim its innovative edge by following other countries’ approaches and prioritizing decentralized early-stage review over onerous FDA approvals. The agency’s proposed “Clinical Trial Notification Pathway” is an important step in that direction.

But as the Taxpayers Protection Alliance documented in its recent report “Blocking Breakthroughs,” early-stage reforms are not enough. The FDA has become far too eager to deny promising medications even following rigorous testing in humans. Reforms such as international regulatory reciprocity and allowing greater use of historical data in drug approvals would help solve these issues.

Ultimately, the FDA needs to change the way it evaluates medications at all stages of the drug approval process. By allowing first-in-human trials to take place more easily and greenlighting more medications for final approval, America can continue to lead in developing game-changing therapies. But these reforms are just the start. The FDA and its staff will also have to ditch their outdated risk-averse mindset. That will take time and effort but is critical to American innovation and prosperity.