I realize clinical trials are really important, because accidentally killing lots of people isn't particularly desirable, but is there a way we could lower this cost? What would need to happen?
That's an incredibly optimistic assumption. My mind instead immediately goes to imaging the kind of horrors people would go through if it were easier to put drugs onto the market than it already is.
We already live through people dying or developing lifelong disabilities due to medication going onto market with side effects that were not properly understood. If the barrier was lower this problem would only be worse.
Unfortunately for many diseases, there are not good animal models. 3D human tissue culture allows for much better laboratory testing of efficacy and side effects. This would allow for better drugs going into clinical trials and better design of clinical trials to show a particular drug's effects.
No I don't have the answer - I ain't paid enough to work on that.
Why couldn't independent labs certify and insure products, a la Underwriters Laboratories?
We could have drugs vetted by these respected medical organizations and be labeled as such, think 'mayo clinic certified', 'johns hopkins certified', etc.
I strongly dislike the mis-alignment of incentives, where the ratings / approval group is paid by the company seeking approval. It has proven disastrous in high-money systems, and I wouldn't trust it for pharma, which has shown similar ethical outlooks as finance (that is to say, little matters except profits).
Not to beat a dead horse, but if you remember the mortgage crisis was due the government incentivizing subprime lending and having fed rate too low for too long; creating a bubble in housing. The ratings agencies themselves were accomplices, but not the sole problem by any stretch.
When in doubt, throw it out.
Spend some time googling stories about people who operated by the book at the ratings agencies. Their careers...did not go well.
FWIW, I was just parroting Nate Silver's section on the financial crisis. He identifies the ratings agencies as one of the several groups responsible for the downfall. In S&N, Silver discusses how the ratings agencies gave their ratings software to the banks, so the banks could "dry-run" their tranches to get the best ratings available.
They were more than just complicit -- they actively enabled the financial groups to game the ratings.
AFAIK, to rate a company/tranch/etc., the ratings agencies need access to internal company information. There's no room for an outsider ratings group to call bullshit -- people are only going to listen to the agency given internal info, the one hired by the company getting the rating.
More competition wouldn't make the outside groups any more relevant, and without revenue, they would likely quickly dry up.
In the other direction, paying for ratings is how we got AAA-rated subprime CDOs.
Public regulators are always preferable, when a market needs to be regulated as you admit, because the public, through the press and their elected representatives, can hold them accountable for their actions. If someone from the Mayo Clinic is receiving improper benefits from pharmaceutical companies how does the public find that out? There are no laws that would force disclosure of those relationships.
In the case of public regulators like the FDA, Congress can force its leaders to testify and the press has tools like FOIA to get at private documents. They're not perfect and can still lead to corruption and regulatory capture, but are preferable to private organizations with no public accountability regulating the pharmaceutical industry.
Atleast in the marketplace, if you mess up - you go broke (or you should, don't even get me started on the idiocy of 'too big too fail'). There's some incentives to hustle, but also to not ruin your firm in the long-run.
At the FDA you know you are on an Imperial Star Destroyer, and that whatever happens - worse case scenario it takes like 5 years to fire you.