In the U.S., a push for revisions of the FD&C Act emerged from Congressional hearings led by Senator Estes Kefauver of Tennessee in 1959. The hearings covered a wide range of policy issues, including advertising abuses, questionable efficacy of drugs, and the need for greater regulation of the industry. While momentum for new legislation temporarily flagged under extended debate, a new tragedy emerged that underscored the need for more comprehensive regulation and provided the driving force for the passage of new laws.
On 12 September 1960, an American licensee, the William S. Merrell Company of Cincinnati, submitted a new drug application for Kevadon (thalidomide), a sedative that had been marketed in Europe since 1956. The FDA medical officer in charge of reviewing the compound, Frances Kelsey, believed that the data supporting the safety of thalidomide was incomplete. The firm continued to pressure Kelsey and the FDA to approve the application until November 1961, when the drug was pulled off the German market because of its association with grave congenital abnormalities. Several thousand newborns in Europe and elsewhere suffered the teratogenic effects of thalidomide. Without approval from the FDA, the firm distributed Kevadon to over 1,000 physicians there under the guise of investigational use. Over 20,000 Americans received thalidomide in this "study," including 624 pregnant patients, and about 17 known newborns suffered the effects of the drug.
The thalidomide tragedy resurrected Kefauver's bill to enhance drug regulation that had stalled in Congress, and the Kefauver-Harris Amendment became law on 10 October 1962. Manufacturers henceforth had to prove to FDA that their drugs were effective as well as safe before they could go on the US market. The FDA received authority to regulate advertising of prescription drugs and to establish good manufacturing practices. The law required that all drugs introduced between 1938 and 1962 had to be effective. An FDA - National Academy of Sciences collaborative study showed that nearly 40 percent of these products were not effective. A similarly comprehensive study of over-the-counter products began ten years later.