The dangers (?) of public funding of drug trials

Ezra Klein relays Jim Manzi's worry that public funding of drug trials

exposes you to the inverse problems of the current system. Namely, "bureaucrats and politicians tend to have enormous career risk from an unsafe drug introduction, but almost none from a rejected drug that would have been effective had it been introduced...[it] would likely result in fewer new drugs being brought to market."

There's a bit to this. But it misses something important: The biggest problem with the present system may not be that deeply unsafe drugs are approved but that too many drugs that carry modest safety issues (and most drugs carry some safety issues) but little if any benefit are approved because their benefits are overstated. The risk-benefit ratio gets misrepresented, in other words, not so much because risks are understated (though that is done too) as because the benefits are oversold.

There are exceptions, of course, like Vioxx, in which an effective drug (it reduced pain) is more dangerous than revealed. But many of the most problemmatic drugs -- most notably psychiatric drugs, which get taken longer and by many, many people -- won approval and entered the market and became popular and then became safety problems, through sheer excess of unmonitored and ill-advised use, only because their benefits were exaggerated enough to win FDA approval and then get marketed as the Next Great Thing.

if the problem is overstated benefit rather than understated risk, then a move to public financing is not as apt to create an "inverse problem" in which risk-averse regulators Just Say No. TIghtening the risk filter, for instance, would probably have kept out only the most egregriously dangerous of the recent drugs-of-scandal, which we would hope is a good thing. A more balanced, skeptical approach to weighing risk against benefit, meanwhile, can only be a good thing. And I'm not sure how reasonable it is to fear that overcautious regulators would "likely result in fewer drugs being brought to market." Much of the drug problem the last few years is that too many drugs were brought to market -- drugs that improved little if at all on previous drugs (or even placebo) and that served mainly to increase health-care costs and, through the sheer hope of the New Good Thing, the number of people taking drugs with questionable efficacy.

Public funding of drug trials seems to me a promising idea, especially if, as Lisa Bero recommends, it emphasizes head-to-head drug competition (see bottom of post) rather than the rather empty requirement that a drug merely beat placebo rather than existing drugs.