If a lot of people take the mediation and die is that evidence that the medication is unsafe? If they live is that evidence that the medication is safe? Either both are true or neither is true. The relative weight of evidence is dependent on priors but it is still evidence.

I agree with this, but we don't have a good understanding of the mechanisms of how most drugs work, and what else they do. That's why, generally speaking, we require actual observational safety data, and not just a thorough description of the mechanism(s) of a drug. And sometimes we find out years or even decades later we were badly wrong. "Safe" is a very qualified term when it comes to drugs. What actually distinguishes $randompeptide from $approveddrug is the safety data - there are papers all about the proposed mechanisms for most of them.