Senate Passes User Fees Bill; FDA Sets Goals for Proposed OTC User Fee Program

From DCAT Value Chain Insights (VCI)

By Regulatory News posted 08-10-2017 15:55


The US Senate has voted to pass The FDA Reauthorization Act, which reauthorizes user fees for prescription drugs, generic drugs, and biosimilars. In a separate move, the US Food and Drug Administration (FDA) has released draft goals and procedures for a potential user-fee program for nonprescription or over-the-counter (OTC) drugs. 

The Senate voted on August 3, 2017 to pass the The FDA Reauthorization Act, which follows the July 2017 passage of the bill from the US House of Representatives. The bill reauthorizes user-fee programs for the five-year period beginning October 1, 2017. The bill now goes to President Trump for consideration for signing the bill into law.

The bill is a product of a bipartisan Congressional effort, begun, in mid-April 2017, when members of the US House and Representatives and the US Senate proposed a discussion draft of The FDA Reauthorization Act.

A key difference between the Congressional bills and a budget proposal by the Trump Administration is the level of user fees. The President’s budget, released in May 2017, calls for more than $1 billion in new user fees to replace budget appropriations for the FDA. 

At the time of the passage of the House bill in July 2017, the Trump Administration re-iterated its position to increase the level of user fees to fund FDA’s premarket review process. “To better support FDA's lifesaving mission while carefully spending taxpayer dollars, the President's Budget asks companies that benefit directly from FDA's premarket review of medical products to finance 100 percent of FDA's premarket review,” said the White House in a July 12, 2017 statement. “In its current form, H.R. 2430 [The FDA Reauthorization Act] would require significant investment of taxpayer resources in FDA's medical product review programs. The Administration urges the Congress to provide for 100 percent user-fee funding within the reauthorized programs. In an era of renewed fiscal restraint, industries that benefit directly from FDA's work should pay for it.”

For prescription drugs, the Senate-passed bill amends user fees for brand name drugs. User fees are eliminated for supplemental new drug applications and drug-manufacturing facilities. A prescription-drug program fee replaces the prescription drug-product fee. This annual fee is assessed on a new drug application holder for each approved drug for up to five drugs. The total user-fee revenue amount is adjusted annually for changes in review-process capacity needs and provides for operational reserves and additional direct costs. With respect to prescription drug user fees, the bill specifies that 80% of revenues must be generated by prescription-drug program fees with the remainder from application fees.

Similarly, user fees are eliminated for supplements to generic-drug applications. An annual generic-drug applicant program fee is assessed on holders of approved generic-drug applications. The amount of the fee is based on the number of applications held. Of total user-fee revenue, 35% must be generated from this fee.

In a separate development, the FDA has released draft goals and procedures for a potential user-fee program for OTC drugs. The program, subject to Congressional authorization, would provide funding to supplement Congressional non-user-fee appropriations and support FDA review of the efficacy and safety of ingredients included in or proposed for inclusion in OTC monographs. The FDA also issued notice of a webinar on August 23, 2017 that will further discuss the proposed program.

The August 23 webinar is intended to be a follow-up to a public meeting on June 10, 2016 and a stakeholder webinar on September 6, 2016 that invited input on the proposed OTC user-fee program. The August 23 webinar will provide an overview of proposed performance goals and procedures related to a potential new OTC monograph user-fee program.

The proposed program, if authorized by Congress, would run in fiscal years 2018 to 2022. Goals set by the FDA for the proposed program include hiring 30 new full-time employees by 2018 with an additional 75 by 2022 as well as putting infrastructure into place with improved review timetables and development in leadership, information technology, user-fee collection system implementation, and collection activities.

While new drug applications and abbreviated new drug applications are product-based, in which a single product must be approved by the FDA, by contrast, the monograph system for OTC products is ingredient-based, according to information from the FDA. This means numerous sponsors may make the same ingredient for the same use and all may market drug products made with this ingredient as long as they comply with all applicable regulations, including the conditions of the monograph.

“The OTC monograph drug-review process remains one of the largest and most complex regulatory programs ever undertaken at FDA,” said the agency in offering information on the rationale for a user-fee program. The FDA estimates that there are approximately 88 simultaneous rulemakings in 26 broad therapeutic areas encompassing hundreds of thousands of products and approximately 800 active ingredients for over 1,400 different therapeutic uses. The FDA says it needs additional resources to work toward finalization of the monograph review process and to address safety issues in a more efficient and timely manner. The agency said that additional resources would also better enable the FDA to consider innovations for drug products containing monograph ingredients, such as the development of new dosage forms for ingredients under existing monographs.

Source: US SenateFDA (proposed goals), and FDA (August webinar)


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