Rationale, aims and objectives
New therapies are increasingly approved by regulatory agencies such as the Food and Drug Administration (FDA) and the European Medicines Agency (EMA) based on testing in non-randomized clinical trials. These treatments have typically displayed “dramatic effects” (i.e., effects that are considered large enough to obviate the combined effects of bias and random error). The agencies, however, have not identified how large these effects should be to avoid the need for further testing in randomized controlled trials (RCTs). We investigated the effect size that would circumvent the need for further RCTs testing by the regulatory agencies. We hypothesized that the approval of therapeutic interventions by regulators is based on heuristic decision-making whose accuracy can be best characterized by the application of signal detection theory (SDT).