Process for Developing Drugs

Before a prescription drug can be placed on the pharmacy shelf, it must undergo a series of rigorous clinical trials. This process can last more than ten years and cost hundreds of millions of dollars, but it is necessary to fully evaluate a drug’s safety and efficacy.

Preclinical Studies

Once a compound has been identified as a potential drug, it must be thoroughly researched before it can be used in human trials. To gain an initial safety assessment, the molecule is tested in a laboratory setting (in vitro) or in animal models (in vivo). If the molecule demonstrates that it is safe to use in humans, the drug manufacturing process and phase 1 studies begin.

Phase 1

Phase 1 clinical trials primarily test the safety of the investigational drug and how it may interact in the human body on its own or in association with other common drugs that a patient may be using. These studies typically last two years and are conducted in approximately 20 to 100 healthy volunteers. At this point, the drug’s dosage range will start to be determined. If phase 1 clinical trials show the potential drug is safe, phase 2 clinical trials can begin.

Phase 2

Phase 2 clinical trials begin testing for safety and efficacy in people who have the condition the drug is designed to treat. Unlike phase 1 trials, phase 2 trials can last several years and often include several hundred patients. The purpose of these trials is to begin to determine potential side effects and risks associated with the investigational drug and continue to determine the proper dose.

Phase 2 trials mark the beginning of controlled testing, in which the investigational drug is compared either to a standard treatment or a placebo (an inactive substance that looks identical to the drug being tested) to prevent bias. If phase 2 trials continue to show the drug is safe and effective, phase 3 clinical trials may begin.

Phase 3

As the largest, most rigorous, and most time-consuming portion of the clinical development process, phase 3 clinical trials are designed to provide definitive proof of safety and efficacy in patients who have the condition the drug is intended to treat. Phase 3 trials, which may last several years, also continue to determine the potential risks and benefits associated with the investigational drug and may determine the safety and efficacy of the drug in combination with other approved medicines. If the results from phase 3 trials demonstrate the drug is safe and effective, the potential drug may be submitted to the US Food and Drug Administration (FDA) for review and approval.


Upon the completion of phase 3 clinical trials, a pharmaceutical company must submit a New Drug Application (NDA) to the FDA that contains all information gained from the clinical trial process. According to the FDA website,1 the NDA must provide the FDA with enough information to help the FDA determine:

  • Whether the drug is safe and effective in its proposed use(s), and whether the benefits of the drug outweigh the risks
  • Whether the drug’s proposed labeling (package insert) is appropriate, and what it should contain
  • Whether the methods used in manufacturing the drug and the controls used to maintain the drug’s quality are adequate to preserve the drug’s identity, strength, quality, and purity

If the drug meets the set criteria, the FDA issues the pharmaceutical company a license to market the drug for its specific indication.

Phase 4

Even after a new drug has been approved and launched, the FDA may require phase 4 clinical trials to further test the new drug’s safety and efficacy. These safety studies may look for rare and long-term adverse effects in broader populations that may not be observed during earlier clinical trials. The manufacturer of the drug may also institute more trials to explore new indications.

Reference: 1. US Food and Drug Administration. New Drug Application (NDA). ApprovalApplications/NewDrugApplicationNDA/default.htm. Accessed February 24, 2017.