Facility rationalizations, outsourcing, and staff reductions can provide only so much of a cushion to pharmaceutical and biopharmaceutical manufacturers about to drop off the patent cliff. The ideal way to remain profitable is to discover and develop innovative new drugs, but this task has proven increasingly difficult for drugmakers over the past few years. Jonathan Leff, a managing director at venture-capital firm Warburg Pincus, says that FDA is partly to blame.

Several developments in 2004, particularly concerns about Merck’s arthritis treatment Vioxx, led patients and lawmakers to question the safety of marketed drugs. FDA received a lot of public criticism for not being vigilant enough, and the agency responded by re-evaluating its practices.

“The FDA’s shift in recent years to an increasingly cautious, risk-averse posture toward new drug approvals has had the unintended consequence of reducing investment in life-sciences innovation due to the significant additional time, cost, and uncertainty it has added to the drug-development process,” said Leff in written testimony to the US House of Representatives’s Energy and Commerce Committee. Medical research “is exploding with potential,” he added, but FDA’s new caution makes it hard for investors to earn returns.

But drug-approval figures seem to undercut Leff’s argument. In testimony before the same House committee, Janet Woodcock, director of FDA’s Center for Drug Evaluation and Research, cited a trend toward greater first-cycle approvals for priority new molecular entities (NMEs). The average first-cycle approval rate for priority NMEs has increased from 46% in 1992 to 68% to date, she said. First-cycle approval rates for standard NMEs have also increased from an average of 30% to 38%, according to Woodcock.

Woodcock also countered claims that FDA approves drugs more slowly than EMA. “Of the 35 cancer drugs approved by FDA or the EMA from October 2003 to December 2010, FDA approved 32—in an average time of 261 days,” she said, citing an article in Health Affairs. In contrast, “EMA approved only 26 of these products, and its average time was 373 days.”

Drugmakers’ lack of approved new drugs might have many causes. Now that the low-hanging fruit has been picked, drug discovery itself has become harder. Although FDA is a fair target for criticism, I don’t think the agency can be blamed for quashing innovation. With appropriate funding, scientific expertise, and federal help, drugmakers should be able to develop the new products that keep them and their patients healthy.