FDA's Structured Benefit-Risk Assessment Framework

In the wake of PDUFA V, FDA committed and is currently implementing a structured benefit-risk assessment framework (sB/R) to organize its review of a product's benefit and risk, and communicate benefit-risk assessment decisions at the point of approval or post-market regulatory decision. The draft guideline is published on FDA's website:

Enhancing Benefit-Risk Assessment in Regulatory Decision-Making

Draft PDUFA V Implementation Plan: Structured Approach to Benefit-Risk Assessment in Drug Regulatory Decision-Making (PDF - 1.2MB)

Biotechnology Industry Organization's Response

The industry trade organization BIO.org published its analysis from sponsors' point of view:

A Lifecycle Approach To Fda’s Structured Benefit-Risk Assessment Framework

It urges the industry sponsors to "use the sB/R framework to better align on key benefit-risk considerations across the drug development lifecycle with both patients and FDA". It can be used as a decision making tool through out the product development cycle.

In summary,  the BIO document discussed two key considerations.  and 3 additional considerations:

A. Incorporation of the sB/R Framework as a Decision Tool
B. Incorporation of Patient Feedback

It then elaborated them through the stages drug development, review and post-approval. For example, in early stage, the sponsor should focus on gather patient input, first two rows of sB/R -- "analysis of condition" and "current treatment options". As development progresses, more data and evidence will be available for "benefit" and "risk" rows.

In the end, it discussed three additional considerations:

1. Embrace the variation in patient perceptions and preferences: patient benefit-risk balance can be heterogeneous.
2. Appropriate regulatory comparison to current treatment options: the document claims that FDA does not -- and should not -- approve drugs based on a comparative effectiveness standard. (Note: I am not so sure.) It also noted any legit comparison to existing option should be based on head-to-head trials.
3. Encouraging a balanced consideration of benefits vs risks. In early development and labeling, safety risk is often emphasized and possibly exaggerated comparing to benefit. This potential bias should be considered.

In conclusions, BIO stated:

Sponsors and patients would benefit from a defined clear pathway to increased collaboration between sponsors and FDA to enable consistent, efficient, and transparent benefit-risk assessment ...

sB/R Framework Adapted for Investment Decision Making

As investor, we shall definitely incorporate the sB/R framework in our due diligence when we analyse biotech company, as firmly as FDA and companies embrace the framework.

But that's not enough. To adapt the framework for investment decision making, we need to extend beyond the technical factor of drug assessment.

Here I propose an extended structured Benefit/Risk framework (esB/R) for investment decision making. It includes two more assessments, which are required to assess the "people" factor and "price" factor. With esB/R, we can all make informed investment decisions while minimizing influence of ego and emotion .