HHS, Congress Battle Over Funding and User Fees

From DCAT Value Chain Insights (VCI)

By Regulatory News posted 05-18-2017 15:10


Tom Price, the US Secretary of Health and Human Services (HHS), advanced the Administration's budget blueprint in calling for increased user fees to fund the FDA rather than appropriated funding. User fees for prescription drugs, generic drugs, and biosimilars expire on September 30, 2017, and Congress has been debating and offering various measures for the level of those user fees under 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). Those measures need Congressional reauthorization to continue. 

Although there is consensus among Congress and the Trump Administration to reauthorize user fees, the debate centers around the level of those user fees, with the Administration seeking increased users fees to fund the FDA and its product-review process. In March 2017, President Donald Trump released his budget blueprint for FY 2018. In it, the blueprint recalibrates medical product user fees to more than $2 billion in FY 2018, approximately $1 billion over the FY 2017 annualized continuing resolution level, and replaces the need for new budget authority to cover pre-market review costs. To complement the increase in medical product user fees, the budget blueprint includes a package of administrative actions designed to achieve regulatory efficiency and speed the development of safe and effective medical products.

In a letter to Patty Murray (D-WA), Ranking Member of the US Senate Health, Education, Labor and Pensions Committee, HHS Secretary Price said "...[A]s outlined in the President's America First Budget Blueprint, the current Administration is seeking to recalibrate how the FDA finances its medical product review work in order to better serve the American people. To ensure the FDA has the critical resources needed to keep pace with this field, the President's Budget Blueprint proposes to increase and restructure the medical product user fee programs at FDA to be 100% user fee-supported programs, with no funding triggers that require budget authority financing. This would replace the need for new budget authority to cover pre-market review costs while maintaining our commitment to speed the approval of safe and effective medical products. This will benefit both taxpayers and patients."

In response, Senator Murray issued a statement to call on Congress to reject such a proposal. "Democrats and Republicans in Congress have worked together on reauthorizing the user-fee agreements to ensure the FDA can meet its responsibilities to patients and families across the country—so it is disappointing that President Trump continues to attempt to inject partisanship into an otherwise bipartisan process.Today’s proposal from the Administration would upend our work and if implemented, leave the FDA hamstrung and without the federal investments it relies on to carry out its important public health work. I hope and expect that Republicans and Democrats alike will reject it.

In a bipartisan measure, in mid-April 2017, members of the US House and Representatives and the US Senate proposed a discussion draft, The FDA Reauthorization Act of 2017, under which 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 FY 2018 for generic drugs; and would increase from $20 million in FY 2017 to $45 million in FY 2018 for biosimilars. 

Since then, the US Senate Health, Education, Labor and Pensions Committee voted on May 11, 2017 to move forward a bill (S. 934) for reauthorization of user fees with certain amendments for consideration for the full Senate. The Health Subcommittee of the US House Energy and Commerce Committee moved forward its bill (H.R. 2430) for reauthorization of user fees, with certain amendments, to the full House committee on May 18, 2017, 

Source: US Senate Health, Education, Labor, and Pensions Committee


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