PDUFA Fees To Increase Slightly
19 CommentsBy Ed Silverman // August 4th, 2008 // 7:36 am
The FDA has established its fiscal year 2009 user fee rates, which were established under the Prescription Drug User Fee Act, the FDA Law blog notes. And here are a few details - rates have been set at $1.24 million for an application requiring clinical data, and one-half of a full application fee, or $623,600, for an application not requiring clinical data and a supplement requiring clinical data. As the blog’s chart indicates, this amounts to a 6 percent increase from the previous fiscal year.
Scott
Considering the massive hiring that the FDA is now doing, as well as the huge expenses for foreign drug manufacturing facility review, the user fees currently being proposed are leaving the FDA dramatically under-funded. Perhaps the user fees should be increased much more, rather than pawning that expense off on taxpayers?
Moonshooter
Scott, that’s a wonderful idea. Do you suppose our illustrious congress can grasp the concept?
Justice in Michigan
The FDA has been underfunded pretty much since its inception, and it’s gotten considerably more serious given the number of everything (way beyond drugs) that it is supposed to regulate.
As policy, I think we’ve yet to decide whether we really want this agency or not. That also goes back one hundred years. Right now, FDA’s biggest supporters are those who want to canonize it in minimalist form (preemption). As Bob said the other day, this regulatory capture - what happens when those whom an agency is supposd to regulate take it over.
Dianne
Justice – As a concerned American, I view the FDA’s preamble as a trend and slippery slope to the lost of our civil liberties. Today it’s drugs, tomorrow it will be product liability immunity for another large industry.
The Fox guarding the Henhouse and powerful drug lobbyists are working to alter our civil rights so that the desires of corporate America are met.
“Officials Fail To Track Lobbying, Report Says (washingtonpost.com)
Lobbying expenditures in Washington have at least doubled in the past six years, the center [Center for Public Integrity] reported. Last year, corporations, labor unions and interest groups spent more than $3 billion trying to influence the federal government, up from $1.6 billion in 1998. - Jeffrey H. Birnbaum, washingtonpost.com, April 8, 2005”
Possible solutions are: Put a tax on Pharma that adequately supports FDA. Add a stipulation that the tax has to be used to build up and support the FDA. Outlaw fees from Pharma to FDA. Make it a serious crime if FDA takes money from Pharma/politician (or vice versa).
In a letter I recently wrote to Nancy Pelosi regarding FDA preemption and the loss of legal redress, I asked:
“What part of “no legal recourse,” sounds American to you? And, how will Congress ever justify this betrayal to the American people?”
If/when she responds, I’ll post it here.
Atlex
Dianne,
The user fee is essentially a tax designed to specifically support the FDA drug review process rather than rely on general tax revenues. If Congress would ever apprpriate enough money to support the FDA, user fees wouldn’t be necessary. That being said, the structure of these user fees should have nothing directly to do with preemption. Preemption either exists or it doesn’t (we’ll see what the courts say) whether or not the are user fees.
Atlex
Justice in Michigan
Right. I think the basic point on which every recent report on FDA agrees (IOM, GAO I and II, Science Board, etc.) is that FDA does not have the resources, will, mandate to perform its mission. That is not the “fault” of PDUFA, except to the degree that an increasingly large percentage of the CDER budget has been dedicated to meet the agency’s side of the new drug review budget, at the expense of post-approval surveillance and other branches (e.g., the OCI) of Regulatory Affairs. (The small percentages of the last two PDUFA’s that went in those directions doesn’t change anything substantively.)
So you have an underfunded agency, in which PDUDA has had the effect (not through its direct fault) of tilting the balance further away from regulatory functions like post-approval surveillance and criminal investigation.
And then you canonize it with preemption. Atlex, I don’t know if you’ve read the HHS report that went with the preamble. I hadn’t until recently. But - and I’m candidly ashamed to say this about a branch of my own government - it is one bare-faced lie after another about the way the agency and industry actually function. All of which serves as further justification to (a) strangle the agency (b) lie about that and (c) canonize the lie.
Dianne
Atlex – User fees are like the “cops” charging the “criminals” to protect us. The door is open for corruption.
For our health and safety, financial ties between Pharma and the FDA need to be broken.
Jack2
If you drive a car you probably paid a fee to get your license. You also probably paid a fee to register the car. The DMV depends on those fees to function, and yet it also must regulate motor vehicles to make sure 1) only competent drivers get a license and 2) only registered cars go on the road.
But this is far from the only example where the regulated “consumer” of a government service also pays extra for that service, beyond normal taxes.
I paid the government to give me a passport.
I paid for a marriage license.
I paid to use tennis courts in my town’s park.
That’s all I can think of in 60s.
I want a strong, competent FDA. I don’t mind if the money comes from taxpayers. I don’t mind if the money comes from industry (brand, generic, or, when relevant both). I don’t mind if it comes from the combination of the two. I don’t mind if their role in regulating the food industry (which I know MUCH less about) comes from a fee paid by farmers and ranchers. I just want them to be adequately resourced. With NME approvals coming slower, and with reviews now taking longer here than in Europe, you know, pharma just may have a point.
Justice in Michigan
What the best research has shown (in my view) is that increased funding to FDA does, indeed, facilitate quicker reviews (whatever the outcome). This was already the case before PDUFA.
As far as NME approvals coming slower, even when the “drug lag” was a highly politicized issue (as it is becoming again) it was mostly mythical. The length of time for review between FDA and the U.K. were almost identical - and this was before PDUFA.
Some will recall that the identical folks who are now calling for FDA preemption were then calling for dissolving the FDA altogether.
Ironic, no?
Justice in Michigan
Re: Dianne’s point, I believe there are cases that show a clearly inappropriate relationship between regulators and regulated. And some FDA senior managers figure centrally in that. The Rezulin case has some of the more “dramatic” such examples; Vioxx a bit less dramatic, but - at the least - striking.
What has PDUFA contributed to that? I’m not sure. In the past, way before PDUFA, industry presumed virtual free reign under some FDA regimes. Ask Frances Kelsey (who was ultimately supported by her own senior managers).
My own sense is that inappropriate “coziness” has more to do with who is in FDA senior positions than with PDUFA per se.
Dianne
Jack 2: The DMV and your town park don’t make law—they just enforce it.
The FDA is attempting to make the law, enforce the law, and adjudicate the law, all on the side of Pharma–using fees paid to them by Pharma.
I’m not saying the FDA doesn’t need more money; I am saying, they shouldn’t be paid by the industry they police.
Actions talk. The FDA has shown that they are going to act on the side of big business.
Jack2
Neither the DMV, the town park, nor FDA makes the law. The state, municipal and federal government, respectively, make the law.
Atlex
Dianne,
As Jack2 points out, the FDA is a regulator. It regulates based on the laws passed by Congress and signed by the President. Congress set up the user fee structure, not the FDA. Congress decided that rather than fund the FDA to the extent that is required to operate effectively, a better alternative was to extract user fees from the industry. This is common practice at the federal, state and municipal level. If you don’t like it, go to your congressman and ask him/her to fully fund the FDA and ban user fees. In the end, it is not the user fee that impacts the positions taken by the FDA, but the leadership put in place by the administration.
Atlex
Justice in Michigan
As above, I agree with Atlex that leadership (or lack thereof) is probably more important than funding source. That comes from the administration, not Congress (although they have to approve the Commish).
PDUFA has a complicated history that involved a good deal of input from industry, FDA, and others at the time. So while Congress approved it, it seemes too simple to me to say they “set up” the PDUFA system.
The jury is still out on the full range of its impacts. As above, it certainly had the result of taking other CDER internal budgetary resources and moving them to new drug review.
Dianne
Jack2, Atlex: Thanks for your comments. It is very obvious that, as a “regulator” the FDA has a lot of power, and the industry they are “regulating” and receiving fees from is in a position to cost Americans their health, safety, and civil liberties.
Regardless of who is responsible for the current system, it is ripe for corruption.
The following comments are from David Kessler:
“Even if FDA’s funding were doubled or tripled, its resources and ability to detect emerging risks on the thousands of marketed drugs and devices would still be dwarfed by those of the drug and device companies who manufacture those products…
For that reason, the tort system has historically provided a critical incentive to drug and device companies to disclose important information to physicians, patients, and the FDA about newly emerging risks…
My greatest concern with preemption is that it would, I believe, dramatically reduce the incentives for manufacturers to act quickly and responsibly to detect, analyze, investigate, and take action on potentially serious and life threatening adverse reactions once a drug is on the market.” – David Kessler, Former FDA Commissioner, Oversight Committee Meeting, May 14, 2008”
Justice in Michigan
Hi Dianne - Of course, I appreciate the Kessler quote. But PDUFA was significantly his initiative. I’m not sure how he feels about it now - does anyone know?
Justice in Michigan
There are interesting recent comments by David Kessler on PDUFA at
http://oversight.house.gov/documents/20070501193354.pdf
He is certainly not as enthusiastic about it as he once was, particularly because of the ways it has drained away CDER resources from other needs, as discuseed above.
Dianne
Hi Justice – I didn’t know David Kessler was involved with the making of PDUFA. In fact, until recently, I didn’t even know he was a former FDA commissioner. I began to pay attention to Pharma and FDA preemption when I learned the off-label use of Celexa was to blame for a serious health crisis in my family.
I’ve learned a lot, and, for that, I give a lot of the credit to you and Ed and all the good folks here at Pharmalot. Thank you.
Justice in Michigan
My pleasure, of course. Yeah, PDUFA was initially viewed as the perfect compromise - reviews speeded up, Congress gets off the hook for underfunding FDA, and there is a certain sense of appropriateness that the industry that benefits from FDA review should foot some of the bill.
None of that prevented Gingrich and Co. from trying to destroy FDA (and Kessler) altogether a few years later.
In the meantime, there were also a number of unforeseen consequences. And David K. is a lot less sanguine about the impact of PDUFA now than he was at the time.