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Causal Inference in Regulatory Science: Challenges, Trade-Offs and Future Trends Causal Inference in Regulatory Decision Making and HTAs: Challenges and the Road Ahead - Phastar
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Causal Inference in Regulatory Decision Making and HTAs: Challenges and the Road Ahead

4 minute read

Published: July 15th, 2026

How Regulators Evaluate Evidence in a Changing Data Landscape 

As clinical research evolves, causal inference is playing an increasingly important role in regulatory decision-making. With this shift comes challenges, particularly when balancing scientific rigor with real-world applicability. 

A key takeaway from our expert discussion: causal inference should be incorporated from the very beginning of a study. Starting with a well-defined research question leads to clearly outlining the goal of a study. If that goal is causal inference, certain tools can be leveraged such as directed acyclic graphs (DAGs). A DAG can influence various aspects of a study, including:

  • Data source selection 
  • Confounding adjustment strategies 
  • Sensitivity analyses 
  • Overall study design 

By integrating causal thinking from the beginning, teams can ensure alignment between their objectives and methodologies, something regulators increasingly expect. 

The Internal vs External Validity Trade-Off 

One of the most complex challenges regulators face is balancing: 

  • Internal validity (the rigor and reliability of causal conclusions) 
  • External validity (how applicable findings are in the real world) 

There is no one-size-fits-all approach. Regulatory decisions are highly context-dependent, influenced by factors such as disease area, availability of treatments and urgency of unmet need (e.g. rare diseases). Rather than focusing on a single method, regulators evaluate the totality of evidence to determine whether it is sufficient to support decision-making. 

The Role of Real-World Evidence 

With increasing reliance on real-world data, causal inference methods are becoming more critical. Initiatives across academia, industry, and regulatory bodies, particularly in Europe and North America, are exploring how real-world evidence can inform decisions more effectively. Frameworks and guidance are already beginning to incorporate causal concepts, such as: 

  • DAGs in methodological recommendations 
  • Structured approaches like target trial emulation 
  • Standardized reporting templates 

These developments signal a shift toward more formal integration of causal inference in regulatory settings. 

Looking Ahead: What’s Next for Causal Inference? 

It is likely causal inference approaches will become even more prominent over the next 3–5 years. Key trends include: 

  • Increased use of structured frameworks and templates 
  • Greater collaboration between regulators and researchers 
  • Potential development of dedicated guidance documents 
  • Continued innovation in leveraging real-world data 

As these practices mature, causal inference may become a standard expectation.  

Practical Considerations for Study Design 

Regulatory discussions also highlight important considerations in study execution, such as: 

  • The value of including a concurrent control group, even in augmented RCT designs 
  • The need to carefully manage the influence of external data sources 
  • Focusing not just on sample size, but on how data impacts conclusions 

Additionally, clinical input remains essential, especially when defining criteria that affect both sample size and real-world feasibility. Causal inference is rapidly reshaping how evidence is generated, evaluated, and used in regulatory settings. While challenges remain, particularly around trade-offs and implementation, the direction is clear: causality is becoming central to modern clinical research and decision-making. For organizations looking to stay ahead, embedding causal frameworks early and aligning with evolving regulatory expectations will be key to success. 

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