The secret liberalization of animal drugs
The FDA should do something similar for humans
This is a sneak peek of Issue 19 of Works in Progress.
Author’s note: This piece was written before the 2025 changes to the FDA were brought in, and envisages changes most relevant to an FDA operating along the lines that it did prior to 2025, or other drug approval agencies around the world (such as the EMA and the MHRA). Reforming drug permitting is important, but successful reform is most likely to mean iterating based on an existing, well-staffed, and functional baseline.
As someone who makes drugs for animals, I am occasionally asked if there’s an FDA for animal drugs. There is: the very same FDA that approves human drugs, or at least a subdivision of it. Specifically, there’s a department called the Center for Veterinary Medicine, or the CVM. It regulates most animal drugs, using pretty much the same criteria it employs for human drugs, as does its European counterpart at the European Medical Agency.1 Specifically, companies must demonstrate that their animal drugs are safe, effective, and shelf stable.
As in human trials, this procedure generally takes the form of an initial small-scale safety trial in healthy animals (which in humans would be Phase 1), a larger safety and efficacy trial in sick animals or ‘in the field’ (the Phase 2 equivalent), and lastly the largest efficacy trial in sick animals (the Phase 3 equivalent). As in human drug trials, the cost, time, and complexity varies a lot depending on the disease and the patients. Generally, I would estimate the following:
Initial safety trial in healthy animals: 6 months, $500,000
Small field safety/efficacy trial in sick animals: 2 years, $2 million
Large field safety/efficacy trial in sick animals: 3 years, $7 million2
Animal drug trials are expensive and time consuming, although less so than their human equivalents, which generally take twice as long and cost at least ten times as much. An entire industry has grown up around running these trials for animal health companies: housing the animals; synthesizing the drug compounds; and carrying out the lab work, including dosing the animals and monitoring them to see how the drugs affect them. This, again, is much like the human health industry, and these Contract Research Organizations and Contract Development and Manufacturing Organizations (known in the industry as CROs and CDMOs respectively) have become indispensable.
These trial-running organizations have become indispensable for the parts of the animal health industry that can use them, that is. The animal health industry covers every non-human animal, from dogs to cats and horses to oysters. As you’d imagine, these contract research organizations are well equipped to take care of dogs, somewhat less equipped to take care of cats, and find it difficult to attend to weirder animals like hedgehogs, let alone oysters. Similarly, the regulators at the Center for Veterinary Medicine are well prepared to deal with dog diseases and safety, but less familiar with those of hedgehogs.
This makes it difficult for the regulators to evaluate hedgehog trial outcomes and determine if they’re better, worse, or in line with what they’d expect. In a dog trial, for example, it’s unsurprising if some of the dogs will randomly vomit or get diarrhea because dogs eat trash off the street when owners aren’t looking, vomit it up, and are then fine. Hedgehogs, according to Google, vomit very rarely (except from motion sickness), and it’s probably an emergency if they do. So, a dog vomiting in a trial is no big deal, while a hedgehog vomiting is. This is exactly the sort of judgment call that the regulators or contractors running the trial need to make, but a lack of prior experience can make their job hard.
Small market means fewer drugs
Practically speaking, the lack of trial-running organizations, and the inexperience of the CVM discourages trials for any non-major animal. Tie in the small monetary rewards for successfully releasing an animal drug in a minor species (a blockbuster drug for oysters would be lucky to make $20 million per year), and that makes plowing through the entire regulatory pathway basically not worth it.
Recognizing the obstacles to releasing drugs for animals, the animal health industry started working from the 1990s on creating an animal equivalent to the Orphan Drug Act.
The Orphan Drug Act, dating from 1983, was meant to tackle the lack of drugs for rare human diseases. Rare human diseases (defined in regulation as any disease or disease subtype that fewer than 200,000 Americans suffer from) suffer from the dual problem of regulator unfamiliarity and low revenue potential, like non-major animal diseases.
When FDA standards for drug safety and efficacy got a lot stricter in the 1960s, following the thalidomide near miss, drug developers almost abandoned rare diseases.3 The Orphan Drug Act was intended to fix this issue. First, it addressed the issue of regulator unfamiliarity by creating regulatory fast tracks, including an accelerated approval pathway (more on that later). Second, it sought to minimize low revenue potential by offering tax credits and a greater length of time for market exclusivity.
By and large, the law has been considered a success. It resulted in a cornucopia of drugs for rare, hitherto untreated conditions, such as the recent series of effective drugs for notoriously intractable cystic fibrosis (four approved drugs since 2012), and a lot more research into these rare conditions. The only people who’ve complained about the legislation have criticized it for being too successful, allowing companies to make a much greater profit on rare diseases.
Companies have used the act to make a lot of money from small investments, occasionally (and controversially) by getting a drug approved in a rare condition and then ‘expanding’ into more common conditions. Provigil (aka modafinil) is the most notorious example of this, having started as a narcolepsy drug (narcolepsy being an orphan condition with only about 200,000 sufferers in the US) and then gradually expanding into a general anti-fatigue drug, making $1 billion a year by the time it went generic in around 2010.
Drugs for orphan animals
The success of the Orphan Drug Act prompted the animal health industry to take notice. After a lot of back and forth, an animal-focused equivalent to the Orphan Drugs Act was passed in 2004 as the Minor Uses and Minor Species Act (or the MUMS Act).
Like the Orphan Drug Act, the MUMS Act created an accelerated approval pathway for drugs targeting neglected conditions or neglected species, offered grants and tax credits to offset the costs of the trials necessary to get the drugs approved, and extended marketing exclusivity rights. However, unlike the Orphan Drug Act, the accelerated approval pathway in the MUMS Act far surpassed what existed before.
The Orphan Drug Act’s accelerated approval pathway allowed for using ‘surrogate endpoints’ in trials – something linked to the desired outcome instead of the outcome itself, like using tumor shrinkage instead of cancer remission or survival – to get a drug on the market before checking if the drug affects the clinical endpoint later on (usually by auditing what happens in normal clinical usage).4 Such a regulatory loosening seemed radical enough from the FDA’s viewpoint.
But the MUMS Act went further still, reflecting the higher risks that the regulators were willing to take with animals’ health as compared to humans. The MUMS Act allowed for a ‘reasonable expectation of effectiveness’ to get a drug on the market before a company needed to run a full efficacy trial. The reasonable expectation of effectiveness could rest on as little as a literature review to support the claim that the drug would probably be effective in the target species. Then the company could simply run a safety trial in lab animals before marketing the drug to the public. If the target condition or human interaction with the species was rare enough, the drug might never have to go through any trials, but could be just put permanently on the market as an ‘indexed’ drug.
This was and is a radical departure from the FDA’s normal modus operandi. Since the 1960s, the FDA has been bound by statute to require evidence of both safety and efficacy in humans. In practice, for drugs that go through a regular approval process, this means two randomized controlled trials (RCTs) with clinical endpoints; for drugs that use the accelerated approval pathway, it means an RCT showing benefit on a surrogate endpoint, with a requirement that a confirmatory trial showing benefit on a clinical endpoint be run after approval.
The FDA, in general, is usually very cautious, and its animal wing used to be no exception. Reviewers required strict proof of safety and efficacy before drugs can be sold to the public. Any doubts, and the drug is not sold. Drugs approved on accelerated pathways are reviewed and, if they fail to live up to their promise, withdrawn (although the FDA is not always speedy at forcing withdrawals). MUMS’s reasonable expectation of effectiveness standard eschews such hesitation in favor of action: get the drug out to the public first, get efficacy data later.
MUMS the word
This massive change in the veterinary drugs regulator’s outlook passed unnoticed outside of the animal health industry. MUMS, as the name suggests, is restricted to minor uses and minor species. By the FDA’s definition, not only does that limit itself to uncommon diseases in major species and common diseases in minor species (i.e. not cats, dogs, horses, cattle, swine, turkey, or chickens), but also only to members of the species that are guaranteed not to be eaten by humans (e.g. fish fry qualify, but adult fish do not). Unless you’re deep in the weeds treating obscure animal diseases, like saltwater fish agitation during transport, or nasal adenocarcinoma in dogs, this sea change probably escaped you.
This little-known regulatory shift became much more important in 2018. That’s when the FDA quietly and unceremoniously expanded the MUMS Act to include major uses in major species, if the major use would require an overly expensive or complex trial. So, instead of MUMS just including hedgehogs, fish fry, or incredibly rare canine diseases, it would also include major animal diseases, like canine dementia or feline chronic kidney disease. They called this expansion ‘expanded conditional approval’ or XCA.
This expansion turned the MUMS Act from a regulatory curiosity into a crucial drug pathway. Before 2018, MUMS only mattered for minor diseases and minor species. It was important for the people investigating oyster herpes, but not for those outside their circle.
After 2018, the new expanded MUMS became a much faster way to go to a destination a bunch of people wanted to go to but previously couldn’t spare the time or expense for.
These ‘destinations’, or indications, that XCA opened up include some of the most important and unaddressed issues in animal health. The drugs that have already been conditionally approved under XCA include treatments for seizures, pancreatitis, and congestive heart failure in dogs, and anemia in cats. They also include some entirely new indications that no one had thought possible to target, like longevity (more on that later). Because many of these unaddressed conditions in animal health are also poorly addressed in human health (i.e., there are no human drugs for treating the causes of pancreatitis), XCA also opened up the possibility of treating sick animals as the conduit for developing revenue-generating drugs for humans.5
The MUMS Act expansion has made developing drugs for complex animal diseases substantially easier and cheaper, at least insofar as getting the drug to the revenue stage. But it is not perfect. The CVM has made it difficult to know exactly how to qualify for the XCA and what evidence indicates a ‘reasonable’ expectation of effectiveness, likely because they want to retain discretion for cases where a reviewer believes a proposal would obey the letter of the law but not the spirit. As with all their guidelines, they warn that what’s written down is meant to be ‘informative’, not binding. In order to know the details of how the XCA would impact any individual company or product, you have to talk to the FDA. That involves a long, complicated regulatory process, including 17 steps to register for the ability to submit documents to the FDA. This makes it difficult for pharmaceutical companies to work out what using the XCA pathway to get a drug approved would be like.
Longevity in dogs
As it wasn’t practical to register a company specifically for the purposes of this article, and my own company is still a bit away from submitting an application for XCA, I chose instead to examine the recent, high profile XCA approval for Loyal’s lead drug, LOY-001. Loyal, if you’re not familiar, is a company developing longevity therapeutics for dogs, with the goal of eventually developing them for humans.
Longevity therapeutics for either are hard to get right. So far, none have been approved, and Loyal may be the only company to have had a novel longevity therapeutic even under consideration by any branch of the FDA [5]. Part of the reason others haven’t tried is that trials in longevity are nightmarishly long and complex, given that they need to run until a significant number of patients have died. For longevity drugs meant to be taken early in a creature’s lifespan, it’s very challenging to predict how long the trial should be and budget for them. For drugs meant to be taken later, patients in both the treatment and control groups will often die of other causes, which looks terrible from a safety perspective and risks halting the trial. These trials also run into psychological limitations: as the studies are guaranteed to take multiple years, they require veterinarians and pet owners to follow study protocol for much longer than the normal human attention span.
At the same time, depending on how you look at it, longevity is the single most important condition to treat in humans or animals. Almost every animal that reaches a certain age suffers from the ailments of old age, and it’s not a coincidence that most dogs of a similar size tend to die at similar ages. That’s certainly Loyal’s stance, which led them to convince the FDA (and its CVM subdivision) that:
Longevity is a serious, unaddressed condition that affects the lifespan of dogs
Running a trial in longevity would be incredibly complex and expensive
Convincing the FDA of this took, by Loyal’s accounting, about 2,000 pages of evidence from third-party research and their own studies. In return, the FDA agreed to waive the requirement for a full placebo-controlled trial before Loyal could legally sell LOY-001 and allowed Loyal to temporarily substitute the following completed studies instead:
An observational study in pet dogs showing that large dogs aged faster than small dogs;
A lab study in lab dogs showing that obese dogs had higher levels of a certain biomarker than non-obese dogs;
Third party data showing that obese dogs have shorter lifespans and healthspans than non obese dogs;
A third-party observational study showing that large dogs often had higher levels of that same biomarker than small dogs;
An interventional study in lab dogs showing that Loyal’s therapeutic reduced levels of that biomarker
Based on my estimates, this shift allowed Loyal to substitute a $20 million, five-year trial for a trial lasting just 18 months at the cost of just $1 million: quite a feat! More importantly, it allowed Loyal to hasten their drug into the real world, gather way more evidence from a wider variety of dogs than they could ever get with lab trials alone, and earn money along the way.
Of course, that still leaves Loyal with safety and stability trials. I’d estimate the safety trial will take at least 12 months and cost $1 million, judging by how long they want dogs to take the drug. It’s hard for me to estimate how long the stability trial will take without knowing more about how the drug is manufactured. Loyal seems to anticipate approval for the drug by 2027, so it looks like they’re budgeting at least two years.
Still, this is dwarfed by what the efficacy trial would require in terms of cost, complexity, and scientific risk. Proving that a drug for a novel condition is safe, shelf-stable, and affects a biomarker is a much lower bar to clear than proving that it works.
Loyal has stated that their goal is to prove that their drug works in dogs and then bridge over into humans. I admire their ambition, but I’m not sure how feasible it is given the current regulatory environment: dogs are better models than mice, but not by a lot. In practice, even if they did prove it worked in dogs, they would have to go through all the same trials as any other drug.
The human equivalent of a MUMS Act does not feel like it is on the horizon. The closest thing the human drug world has to XCA is the pathway of accelerated approval, which allows for the temporary use of ‘surrogate’ endpoints instead of primary endpoints to speed up trials.
Surrogate endpoints can include biomarkers that indicate biological changes in the expected therapeutic direction, even when these changes don't necessarily translate to meaningful clinical improvements. For example, recently, the FDA approved Biogen’s ALS drug Tofersen based on trial results showing a reduction of neurofilament, a biomarker whose increase is associated with a progression of ALS, even though the reduction of neurofilament in the trial had a negligible effect on patient function. If this fails to show an effect in post-market studies, it will be withdrawn.
Accelerated approval is a useful pathway, but it could never be anywhere near as powerful as XCA, nor is it intended to be.
Expanded conditional approval deliberately lowers the barriers to getting a drug to market. We are ultimately willing to take more aggressively utilitarian tradeoffs with animals than we are with humans. By contrast, accelerated approval is intended to be almost as rigorous as regular approval. Under accelerated approval, any surrogate endpoint used is supposed to be robustly correlated with actual clinical benefit, although this isn’t always the case in practice, as with Tofersen. Unlike XCA, accelerated approval is not supposed to allow drugs that might not work to be prescribed to patients, only to remove them from the market later. The sorts of short, correlational studies that Loyal used to weakly link obesity in dogs to size differences in dogs to differences in longevity between large and small breeds would not be allowed under accelerated approval.
What would XCA in humans look like?
Imagine if there were a human regulatory pathway called, say, 'expanded accelerated approval', or XAA. Imagine if the FDA designed this XAA pathway to incentivize development in chronic, serious conditions that are difficult and expensive to run trials for. What might happen if they allowed the use of biomarkers and surrogate endpoints based on an explicitly ‘reasonable’ correlation to clinical endpoints, rather than a supposedly robust correlation, with the restriction that companies would have to run a full clinical trial in five years or their drug would be pulled off the market?
Here are my predictions:First, way more companies could tackle serious, chronic conditions with a wider variety of approaches. Right now, it costs about $180 million to bring a drug to market for an average condition, even an orphan condition. Serious, chronic conditions cost upwards of $1 billion in development.
This cost barrier doesn’t just limit the companies that can do a trial in conditions like Alzheimer’s to the biggest companies and their partners. It also limits the approaches people are willing to take, as nobody’s willing to risk $1 billion on a therapeutic or modality that will look stupid if it fails. Risking $100 million (or hopefully even just $50 million), although still a lot of money, is much more palatable for the average large VC investor.
Second, patients could have a much wider variety of treatments to choose from, unveiling diversity in the diseases themselves. One of my most firmly held beliefs in biology is that many chronic conditions, such as Alzheimer’s, Parkinson’s, or chronic kidney disease, are actually sets of different conditions with common symptoms. This diversity is hidden, though, because treatments have to target the average patient in order to yield successful trials. Treatments that would be effective for a small subset of patients and ineffective for the majority of patients end up looking mostly ineffective when applied to the entire population.
Real-world evidence of many different types of treatments in many different types of patients could reveal that diversity in a way that massive, expensive, one-off trials don’t. Right now, this is only found accidentally by physicians, who don’t have the resources necessary to explore it. This real-world evidence wouldn’t be a replacement for a pre-registered, randomized controlled trial, but it’d be much more useful than one-off case studies by physicians.
Third, cheap drugs and treatments could become more common. Right now, every treatment, if approved, has to immediately start making back its cost of development. Debt and equity holders demand repayment. Cheaper trials could mean cheaper drugs.
This would be a tradeoff. In exchange for more experimentation in drug development, a wider range of treatments, and cheaper drugs and treatments, patients would trade the certainty that every drug on the market will work, and the ability to pay for everything out of insurance. It would be almost impossible to coordinate payers so that they are willing to cover unproven drugs, meaning that patients would have not only to pay for them out of pocket, but also to judge (with their doctor) which drugs to take. It would also depend on the FDA enforcing post-market studies more effectively than they do today.
These downsides are real. But the trade is worthwhile. Animals have the same FDA as humans. But they are fortunate that it is much more willing to take chances on efficacy without sacrificing safety through the expanded conditional approval pathway. If this pathway could be expanded to humans as well, it’d be a win for all species.
Trevor Klee is a writer and biotech entrepreneur. More of his work can be found here.
Featured image by Robin Dawes via Flickr.
Vaccines and other biologics are regulated by the USDA for arcane regulatory reasons, but the USDA’s process for animal drugs is largely similar to the FDA’s.
Although not all 'pivotal' studies have to be run in the field. For example, Cerenia, an anti-nausea drug for dogs and cats, was proven efficacious by putting lab dogs on a sort of roller coaster designed for the trial. The treatment dogs were given the anti-nausea drug, the control dogs were given a placebo, and then both groups were spun around really fast. The control dogs vomited more than the treatment dogs, and so Pfizer Animal Health (now Zoetis) proved that Cerenia was an effective treatment for nausea.
Thalidomide, a morning sickness drug that caused severe birth defects, was never approved in the US, thanks to a single FDA regulator, Francis Kelsey, who insisted on additional data. Unfortunately, thalidomide was still briefly distributed in the US under the guise of 'clinical trials', and ultimately over 2.5 million doses were distributed. 17 American children still suffer birth defects from the unauthorized use of this drug.
A clinical endpoint is something that is important, avoiding hospitalization or a heart attack, improving patient quality of life, or extending survival. A surrogate endpoint is supposed to be something that correlates with a clinical endpoint, suggesting movement in the correct direction, though there is substantial controversy over how well they tend to do so. See Prasad (2015)
A reader might protest that animal trials have long been a part of pharmaceutical development. But animal trials in human health are always performed on lab animals, and lab animals don’t often naturally develop dementia or chronic kidney disease, at least not in a way conducive to longevity trials. Pet animals do develop dementia and chronic kidney disease. Running a trial on demented pet dogs whose owners have already paid for your drug can be self-financed or even profitable, if it’s tied to the marketing of the drug.
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