The plan to prevent the next Vioxx

NEW YORK (CNNMoney.com) -- A former commissioner of the Food and Drug Administration on Wednesday praised a recently enacted plan to overhaul the monitoring of drug safety in the United States.

Dr. Mark McClellan, former commissioner of the FDA and former administrator for the Centers of Medicare and Medicaid Services, said that a new bill passed by Congress will create a vast new database of drug patients by 2012.

Such a database could prevent another debacle like Merck & Co.'s (Charts, Fortune 500) arthritis painkiller Vioxx, which was withdrawn by the company in 2004 after studies showed an increased risk of heart attack and stroke, McClellan said.

On Nov. 9, Merck announced a $4.85 billion settlement of some 27,000 Vioxx-related lawsuits against the company.

"If they work together and follow the same rules (in how they define adverse events and how they use the data) then you've got tens of millions (of people) in the database," said McClellan to a roomful of biotech executives at Lazard Capital Markets' 4th annual health care conference.

McClellan said major health care organizations such as eHealth Initiative, Partners Healthcare and Kaiser Permanente will coordinate with insurers like Unitedhealth Group (Charts, Fortune 500) and Wellpoint, Inc. (Charts, Fortune 500) to gather and collate the data from patients. This initiative is part of the FDA Amendment Act of 2007, which passed in September.

"Most of the evidence on your products will be coming from sources other than you," said McClellan, who sees the information as being more complete and more objective.

All pharmaceuticals and biotech drugs have to be approved by the FDA before they enter the market. But sometimes safety issues emerge later on, among some of the millions of patients in the open marketplace, that went undetected among the thousands of patients in clinical trials.

Drug companies are require to continue safety studies of their products after they enter the market. But McClellan, a senior fellow with the Brookings Institution, a Washington, D.C., research organization, said that a much larger database from multiple sources will detect dangerous side effects sooner.

"If you could have identified Vioxx problems in three or four months instead of five years, it would have had a huge impact," said McClellan.