US House, Senate Seek Common Ground in User Fees Reauthorization

From DCAT Value Chain Insights (VCI)

By Regulatory News posted 04-17-2017 16:21


Leaders of the US House of Representatives and Senate health committees have released a discussion draft of bipartisan legislation, The FDA Reauthorization Act of 2017, for reauthorizing the US Food and Drug Administration user fee programs for pharmaceuticals, generic drugs, and biosimilars. The proposed legislation comes as the House and Senate consider legislation for reauthorization of the Prescription Drug User Fee Act (PDUFA VI), the Generic Drug User Fee Amendments (GDUFA II), and the Biosimilar User Fee Amendments (BsUFA II), which are set to expire on September 30, 2017 and which need reauthorization by Congress to continue. 

The discussion draft is supported by House Energy and Commerce Committee Chairman Greg Walden (R-OR), House Energy and Commerce Committee Ranking Member Frank Pallone, Jr. (D-NJ), Senate Health, Education, Labor and Pensions Committee Chairman Lamar Alexander (R-TN), and Senate Health, Education, Labor and Pensions Committee Ranking Member Patty Murray (D-WA), who issued a press release supporting the proposed legislation. The issue of reauthorization of user fees has been recently debated in Congress with stakeholders from regulatory agencies and representatives from the pharmaceutical, generic drug, and biotechnology industries testiying before Congress to urge reauthorization of user fee agreements in March 2017 and April 2017. The discussion draft is the latest legislative effort to gain Congressional approval for this reauthorization. 

Under The FDA Reauthorization Act of 2017, the base user fee would increase from $718.7 million in Fiscal Year (FY) 2017 to $878.6 million in FY 2018 for prescription drugs; would rise from $299 million in FY 2017 to $493.6 million in FY2018 for generic drugs ; and would increase from $20 million in FY2017 to $45 million in FY 2018 for biosimilars.

Under the discussion draft relating to PDUFA VI, the allocation of fees would change. Fees were historically derived one-third from facilities, one-third from various application fees, and one-third from product fees. The new structure is derived from 80% program fees for approved products and 20% from application fees. PDUFA VI also seeks to enhance patient-focused drug development, support biomarker development and qualification, dedicate staff to assist in the development and review of rare disease drugs, sets clear timelines and improves guidance for drug and device combination products, and evaluate ways to modernize the clinical trial process.

Under GDUFA II, the bill removes fees for prior approval supplements and establishes a generic drug application program fee that will comprise of 33% revenue from application fees, 20% from generic drug facility fees, and 7% from active pharmaceutical ingredient fees. Moreover, under GDUFA II, 35% of revenues will come from a new generic drug applicant program fee that is determined by how many generic drug applications an applicant has approved by the FDA. A manufacturer with 20 or more approved applications would pay the full fee; a manufacturer with six to 19 approved applications will pay 40% of the full fee; and a manufacturer with five or fewer approved applications will pay 10% of the full fee.

BsUFA II eliminates supplement and establishment fees and establishes for the first time an independent fee structure for biosimilars. The biosimilars fee structure includes: an initial biosimilar development fee for the first year once a sponsor begins clinical trials for a new biosimilar; an annual biosimilar development fee for subsequent years a sponsor is developing a new biosimilar; a biosimilar program fee for sponsors of approved biosimilars; and an application fee for new biosimilar applications. BsUFA II allows the secretary of the US Department of Human Health Services to determine the appropriate percentage that will come from each of the fees, and each fee amount annually.

Source: US House of Representatives Energy and Commerce Committee


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