Title: Insufficient FDA Resources: Levelling the Playing Field and Reducing Fraud by Altering Incentives (2001 Third Year Paper)
Author(s): Joshua L. McFarland
Subject & Subject keywords: Food and Drug Law "FDA" "enforcement"
Abstract:This paper seeks to explore the problems illustrated by the Procter and Gamble orange juice example ; namely, the peculiar side effects of inadequate FDA funding upon competition and rule compliance. Part I of this paper will describe the problem in detail, exploring the FDA’s resources and responsibilities, their effects on competition and compliance, and the various externalities associated with this particular issue. Part II of this paper will discuss ways in which various industries have attempted to circumvent and supplement FDA regulation. Part III of this paper proposes a way in which limited FDA resources could be used more efficiently to encourage industry to notify the agency of violations while simultaneously encouraging violators to cease their offending behavior before formal FDA action is taken towards them or an industry leading scapegoat. My proposal seeks to alter the costs and benefits of FDA rule violation by increasing penalties when appropriate and making enforcement more likely, thus reducing the aggregate amount of rule violation and leveling the playing field. I argue that this goal can be accomplished without significant increases in FDA spending, and perhaps could even reduce spending and increase funding.