Rule of two would provide faster approval of new drugs

Dr Eric Crampton
The Post
11 November, 2023

Medsafe targets a 100-day initial evaluation for drugs already approved elsewhere. It took longer than 176 days for half of the drugs assessed over the past year.

And Medsafe’s latest report shows full approval took over 16 months for half of the drugs it evaluates.

But even if Medsafe met its targets and quickly evaluated new-to-New Zealand medicines, the system still would have failed.

The proper target isn’t processing times, it’s timely access to safe medicines.

If a pharmaceutical has already been approved for use by two or more trustworthy overseas regulators, like the European Medicines Agency, Health Canada, Australia’s Therapeutic Goods Administration, or America’s Food and Drug Administration, does local approval add anything other than delay?

Consider Ozempic, the diabetes wonder drug. New Zealand has substantial issues with diabetes. America’s FDA approved Ozempic in December 2017. Europe, Canada, and Japan quickly followed in early 2018.

The drug proved so successful that Novo Nordisk, the Danish drug’s manufacturer, now substantially improves its country’s GDP figures.

But, pharmaceutical companies’ regulatory teams do not have infinite capacity. And small markets are not at the front of their queues.

Novo Nordisk did not file for New Zealand approval until December 2021, when Ozempic had already been on the US market for four years.

Despite the drug’s obvious success overseas, and despite an abbreviated process for drugs already approved elsewhere, Medsafe took fifteen months to finally say yes. That is about on par with the amount of time it takes to approve drugs not under priority review. It is certainly not as bad as the two-and-a-half years taken to approve another drug through the ‘abbreviated’ process.

If Medsafe had been able to cut its approval time even to as short a time as 60 days, it still would have been more than four years after the drug had been approved by the FDA, and Canada, and Europe.

And to what end? America’s budget for evaluating new medicines is hundreds of millions of dollars larger than Pharmac’s budget for buying medicines. Will Medsafe’s 60 staff catch something the FDA has missed? And that the Europeans and Canadians have also missed? And that Japan and Australia have missed as well?

Medsafe could meet every one of its approval targets in record time, and still add years of delay.

New Zealand could instead rely more heavily on other countries’ approval processes.

If a drug has already been approved by at least two overseas agencies that New Zealand trusts, the drug could automatically be approved here as well: a Rule of Two. Medsafe could keep an emergency handbrake for drugs it considers exceptionally risky and could be assessed on whether it was pulling that handbrake too often.

Every pharmaceutical approval system balances the risk of releasing unsafe drugs against the risk of unduly delaying access to safe drugs – and they generally err on the side of excess caution about releasing new drugs. If a drug has already made it through two such conservative assessments, a third mainly adds delay, especially from a much smaller agency.

In a report released last week, the New Zealand Initiative, in collaboration with student researchers at the University of Canterbury, assessed the merits of our proposed Rule of Two. The work shows Medsafe very rarely declines drugs already approved by others and tends to follow other regulators when they withdraw drugs from the market after approval.


Final Medsafe approval for safe drugs can be delayed by over a decade compared to simply following the Rule of Two.

If Medsafe approval provides any real protection for drugs already approved by two other agencies, it does so accidentally: making it less likely that manufacturers try to bring new pharmaceuticals to the New Zealand market.

Relying on other countries’ approval would not be novel. New cars are acceptable for the New Zealand market if they meet at least one of several foreign standards that our government considers adequate. Requiring extensive local safety testing would mean a smaller range of vehicles would show up late on dealer lots at higher cost – while providing no added safety.

Surely access to the latest pharmaceuticals is at least as important as access to the latest car models. And yet our governments, for years, have maintained processes that all but guarantee slower access.

A Rule of Two would hasten access to safe medicines already approved elsewhere. It would not solve every barrier to access. But it would ease one barrier that mainly seems to delay access to safe medicines, while letting Medsafe focus on more important matters.

The real goal shouldn’t be speedy processing times. It should be timely access to safe medicines. And the Rule of Two would help.

Dr Eric Crampton is Chief Economist with The New Zealand Initiative. His report, Safe to Follow: Faster Access to Medicines for Kiwis, was published on 3 November.

To read the article on The Post website, click here.

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