Key Takeaways:
A one-year reduction in FDA drug approval timelines could generate more than $10 trillion in economic value, according to a new report that calls for the most sweeping regulatory overhaul of the agency in decades.
Trimming just 12 months from the Food and Drug Administration's drug review process could unlock more than $10 trillion in economic value while accelerating patient access to new treatments, a report from the free-market policy group Unleash Prosperity found.
"It takes about a decade from start to finish to come through FDA, and most of that time is not spent on safety — it's spent on effectiveness trials," Tomas Philipson, former acting chairman of the White House Council of Economic Advisers and the report's author, said.
The report, titled "The Multi-Trillion Dollar Opportunity in Reforming the FDA," argues that lengthy post-safety effectiveness reviews account for the bulk of the agency's approval timeline. Philipson noted that the FDA's mandate to verify both safety and efficacy — a dual role unique among global regulators — creates structural delays that compound across the drug development pipeline. The analysis estimates that accelerating approvals by one to six years would generate trillions in economic value through earlier patient access and stronger innovation incentives.
The findings arrive as China's clinical trial system — faster and lower-cost than the US equivalent — threatens to pull drug development investment overseas. Philipson called on the White House to pursue an effort analogous to Operation Warp Speed, arguing that the urgency extends beyond Covid-19 to patients with other diseases. "There's a huge role for the president here to push an analogous effort to what he did with Operation Warp Speed during Covid," he said. "It's equally urgent for other patient groups who don't have Covid but other diseases."
The report's $10 trillion valuation reflects both consumer surplus from earlier access to therapies and producer surplus from reduced development costs and extended patent-effective life. The US pharmaceutical market generated roughly $600 billion in annual revenue in 2025, according to IQVIA data, meaning the estimated value gain represents more than 15 years of current industry revenue.
FDA's effectiveness mandate draws scrutiny
Unlike safety regulators in most other jurisdictions, the FDA is charged by Congress with evaluating both safety and effectiveness — a dual mandate that Philipson argues creates unnecessary friction. "People recognize the role of the government potentially ensuring safety and consumer protection, but it's a unique role that FDA has of ensuring effectiveness," he said.
The report proposes three structural reforms: greater use of artificial intelligence in drug reviews, faster clinical trial designs, and broader access to "right to try" programs that allow patients to access experimental treatments outside of clinical trials. The competitive pressure from China adds urgency — the country's clinical trial infrastructure has matured rapidly, with lower patient recruitment costs and faster enrollment timelines, making it an increasingly attractive destination for global drug developers.
Faster approvals could also lower prescription drug costs by increasing market competition, Philipson said. When drugs reach patients sooner, the window for first-to-market exclusivity narrows, and follow-on competitors enter more quickly — a dynamic that could reduce prices without direct government intervention.
The report's recommendations echo elements of Operation Warp Speed, the Trump-era initiative that compressed Covid-19 vaccine development to under one year. Philipson argued that the same urgency should apply to other therapeutic areas, though he acknowledged that replicating Warp Speed's emergency authorization framework for non-pandemic drugs would require legislative action.
This article is for informational purposes only and does not constitute investment advice.
