Additionally, solving the problem of getting people to take the right drugs may be more complicated than just putting out drugs that have a tiny positive expected value. The market is humans, after all, and humans themselves are loss-averse. There are also credibility problems—it’s easy to blame the regulators for failures, and so humans do. And so people demand that the regulators be very selective, and so they do. If regulators didn’t respond like this, people might behave differently, maybe avoiding new drugs or distrusting doctors.
Additionally, solving the problem of getting people to take the right drugs may be more complicated than just putting out drugs that have a tiny positive expected value. The market is humans, after all, and humans themselves are loss-averse. There are also credibility problems—it’s easy to blame the regulators for failures, and so humans do. And so people demand that the regulators be very selective, and so they do. If regulators didn’t respond like this, people might behave differently, maybe avoiding new drugs or distrusting doctors.