Government 'greed' may not be the best way to put it, but there is something there. This extremely high barrier to entry may not be completely necessary, and in some cases may be interpreted as deliberate suppression of competition effected by vested interests in the pharmaceutical and healthcare industries. If such a product can be proven safe using the same active ingredient and a comparable delivery mechanism, it shouldn't require millions of dollars to be approved.
There are accelerated approval processes for precisely what you're describing. Section 505(b)(2), for example, allows an applicant to rely on studies conducted for a previously-approved drug with the same active ingredient. And of course the whole ANDA generic approval process.
Part of the issue is the incentive system at work. The FDA isn't really rewarded for getting a drug to market quickly, but they are punished politically when they approve a drug that is later found to have problems.
This means that they are incentivized to be cautious, sometimes excessively so.
The regulation is necessary because of the number of bad actors in the industry. From experimenting on people under the guise of vaccination programs through cherry picking of results, drug and technology companies have proven time and time again that they can not be trusted to put human welfare ahead of profits.
How do you prove a new product from a hostile industry safe, without having regulations covering the types of tests and acceptable reporting necessary?
The problem isn't "should we have regulation at all," but rather what is the right level of regulation. It is quite possible that the current burden of proof is too high in many cases. If drugs were made more broadly available sooner, it would likely save many lives. But also it would also likely cost some. Do we currently use the correct threshold?
There is certainly evidence that since regulatory bodies get tons of flack for letting through bad drugs, but aren't imposed on that much for slowing down the process, they incline to being risk adverse. We also have evidence of outcomes in Europe where the regulatory regimes differ and seem to approve things faster with outcomes that aren't generally worse than the US.
I highly doubt we have the optimal regulatory solution at present and could do much better. And if anything we have standards that are too high.
Perhaps it's a situation where there is no outcome where the barrier to entry is too high for bad actors while simultaneously being low for good actors.
The current solution seems to be to increase the barrier until the bad actors are gone; as this means there is less finger pointing.
Going the other way would seem to take active effort from a political representative, and the outcome will end in deaths directly attributable to them.... which would be career suicide.
