The House Passes FDA User Fee Reauthorization Bill; Senate Next

By on June 25, 2012

On June 20th, the House passed the Food and Drug Administration (FDA) User Fee Reauthorization Bill that reauthorizes user fee programs for both drug and medical device review. The Bill also establishes new user fee programs for biosimilar and generic drug review.

The user fees, which have been in place for drugs since 1992 and devices since 2002, provide funding to the FDA for the safety and efficacy review and approval process. Since the user fee program was established, it has provided additional staff and reduced review process time. According to an article in Forbes, Bipartisan Success: House Passes FDA User Fee Reauthorization Bill, “The user fee program has been a great success over the last two decades, as the increased funding from pharmaceutical companies has enabled the FDA to add about 200 staff members and lessen the drug review process almost in half. A 2002 Government Accountability Office report found that the average approval time dropped from 27 months to 14 months over the first eight years of the act, and user fees increased new drug reviewers by 77 percent.”

This Reauthorization Bill would raise fees by more than 2 billion dollars over the prior user fee period. In exchange for the increase, drug and device companies will get more face time with FDA during the review and approval process. The hope is that additional meetings will decrease approval time and increase the overall number of approvals. Regular meetings should work to clarify the review process; an unclear approval process has been a long-standing criticism of the FDA. The hope is that with a more defined process, companies won’t waste valuable time and resources on issues that are not a concern and will be able to dedicate more effort towards key issues.

The Bill also includes an antibiotic development incentive to drug companies. The incentive includes a directive to the FDA to develop a list of the most critical pathogens for which there are no antibiotics available. Antibiotics developed for these pathogens would receive an additional 5 years of exclusivity. This could prove to be a very valuable incentive in the area of antibiotics, where generic versions usually outpace the original product once exclusivity has expired.

The overall sentiment is that the current version of the Reauthorization Bill is a good compromise that gives industry a clear approval process and more time with FDA and it will also reduce government spending at the FDA. In the Bloomberg article, House Passes Compromise FDA Reauthorization Measure, Frank Pallone, a Democrat whose district includes the New Brunswick, New Jersey headquarters of Johnson and Johnson said “This bill is good for the FDA, it’s good for industry, and it’s good for patients alike.” Indeed, the article goes on to state that the Bill would reduce Federal spending by $311 million through 2002 according to an estimate by the Congressional Budget Office.

With current user fees set to expire September 30, 2012, the Senate needs to act fast on this Bill in order to prevent FDA staff cuts and product review delays. The Senate will meet this week to vote. Because this has been a bipartisan effort with compromises on both sides of the aisle, it is expected to pass without difficulty.

What do you think about the user fee issue? Do you think that the increased fees will result in more FDA/industry meetings and ultimately a clearer, more efficient review process?

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