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My problem isn't so much with the FDA contesting false claims. My problem is with them requiring huge amounts of testing for promising treatments while people continue to die, and then holding the manufacturers liable anyway. I agree that quack medicine like homeopathy or herbalism should not be allowed to make any medical claims. Heck, I'd go a step further than that, and require them to make a huge label on their products that says "THERE IS OVERWHELMING SCIENTIFIC EVIDENCE THAT THIS TREATMENT IS TOTAL BALONEY. FOR ENTERTAINMENT PURPOSES ONLY."
However, the FDA has no business regulating the actual sale or use of those products. If people want to buy stupid ****, they should be able to. If they want to take their chances with an unproven new treatment because they have a serious disease, they should be able to. The FDA has almost certainly killed far more people than its saved, by denying them treatments that could have helped them because they were unproven.
I disagree, because it is completely impossible for consumers to make intelligent decisions about powerful medications on their own. Without extensive clinical trials how can drug companies know what the side effects of, say, psychoactive drugs are before releasing them to consumers, to say nothing at all of what consumers would know. Buy at your own risk is simply not a workable system when dealing with drugs that interact in an immensely complex fashion with the way that your body and mind operate. And that's only mentioning risks from drugs - determining their efficacy through the free market is what led to snake oil literally being sold as medicine. Without strong regulations how is a consumer to know the risk, and how are they to know the efficacy beyond what corporations' marketing departments say? Hell, how are doctors supposed to know unless medication is required to undergo rigorous control studies prior to approval. The FDA exists because precisely the system you described does not work. Companies would shove whatever crap they can pick up on the cheap into a bottle and sell it as a panacea, and how are consumers to tell the difference?
It could be like what ISO 9000 or the Better Business Bureau does for corporations. It could be like what US News and World Report does for colleges. An independent body with credibility in the public's eyes.
I think that private oversight would be much more likely to go the way of finance ratings agencies. The pharmaceutical industry is already to close to the government for the consumer's good, and if they were directly paying the people charged with overseeing them I don't see anything positive coming from that situation.
All drugs could be legal and "use at your own risk," but independent agencies could certify how effective their treatments are, and how much evidence there is for those claims.
And where would that agency get its money? I see two possibilities. It could be publicly funded, in which case it would be the FDA, or its certifications could be payed for by the companies wishing to get their drugs certified, in which case you end up with the medical equivalent of AAA rated CDS's, which would have as disastrous effects on public health as the econopocalypse did on the economy.
Like you said, the pharmaceutical industry has a huge amount of influence over the government. They would have much less influence over a watchdog group...particularly if there were rival watchdogs ready to attack their credibility at the first sign of a conflict of interest.
I can't imagine how they would have less influence over a private agency if they were said agency's sole customers. Even if they did, I don't see any benefit in moving drug oversight to the private realm.