FDA effectively spends prescription drug user fee collections

After conducting its 2017 review of FDA policies and procedures and financial records related to the FDA’s use of prescription drug user fee collections, the Office of Inspector General (OIG) concluded that, overall, the FDA spent prescription drug user fee collections appropriately. Since the passage of the Prescription Drug User Fee Act (PDUFA) of 1992 (P.L. 102-571), prescription drug user fees have significantly helped in expediting the drug approval process and eliminating backlogs of pending human drug applications. The average approval time for an application prior to the PDUFA was two years (OIG Report, A-05-16-00040, September 2017).

The PDUFA

The PDUFA, which must be reauthorized by Congress every five years, authorizes the FDA to collect user fees from pharmaceutical and biotechnology companies that are seeking FDA approval of certain human drug and biological products to expedite the review of human drug applications. The user fees provide the FDA with resources, including the ability to hire more reviewers and support staff and upgrade information technology systems. According to the OIG, these resources help the FDA meet its goal of timely review of human drug and supplement applications.

Inadequate documentation

The OIG reviewed $796,065,980 in prescription drug user fees reported for October 1, 2014, through September 30, 2015, and determined that the FDA did not have adequate supporting documentation for $6,402 in travel expenses, made a duplicate payment for airfare of $1,213, and overpaid a traveler $587. The OIG attributed the inadequate documentation to oversight by FDA staff rather than a systemic issue. Therefore, the OIG made no recommendations.

Over-the-counter drug monograph reform the topic of subcommittee hearing

Under proposed legislation, “Over-the-Counter Monograph Safety, Innovation, and Reform Act of 2017,” the over-the-counter (OTC) monograph process would be modernized to streamline rule-making and cut down on FDA resources, while being funded through the establishment of a user fee program. In a hearing before the House Committee on Energy and Commerce’s subcommittee on health on September 13, 2017 regarding the discussion draft, witnesses from the industry and the FDA voiced their support, as well as real world examples and reasoning, for the proposed changes.

Monographs and current process

Unless the FDA has approved a new drug application, the only way an OTC drug can be marketed is if it conforms to a monograph—a standard set of specifications established by the FDA for each therapeutic category of product—and is thus considered generally recognized as safe and effective (GRASE). A monograph is created through a three-step public rulemaking process via the Federal Register and a public comment period. It requires the convening of advisory review panels, publishing of an advanced notice of proposed rulemaking (ANPRM) with a comment period, review by the FDA, publishing a tentative final monograph (TFM), and later finalization of the monograph and subsequent amendments and updates. The FDA has around 88 rulemakings in 26 therapeutic categories covering over 100,000 OTC drug products, and there are 800 active ingredients for over 1,400 uses that the FDA oversees. There are no user fees associated with monograph products currently, and a small staff oversees the OTC program as well as attending to other current mandates. The rulemaking process spans many years and the industry waits for a decade or more for finalized monographs, for example, the ANPRM for external analgesic products was published in 1979 and the monograph has still not been finalized.

Legislation

Since 2014, the FDA has examined monograph reform and the possible creation of a user fee program. The discussion draft includes proposes the following changes: (1) authorizing of the OTC Monograph User Fee Program; transition of OTC monographs from a rulemaking process to an administrative order procedures; (2) expediting administrative order procedures for OTC monograph drugs that pose an imminent hazard to public health or are associated with serious adverse events; (3) providing for a procedure to account for minor changes; (4) providing for a two-year exclusivity period for certain OTC innovative changes; and (5) clarifying how sunscreens would be reviewed.

Stakeholder witnesses

 Witnesses from across the industry presented statements before the subcommittee. They touched not only on the problems with the current process and their support of the proposals, but also their support in the industry supplementing the government’s efforts with the user fee program.

  • Bridgette L. Jones, MD, FAAP, representing the American Academy of Pediatrics (AAP), raised an example of how long it takes to get a monograph changed. Over a decade ago, in response to a petition to the FDA, an FDA advisory committee voted unanimously “that it was no longer appropriate for adult data on cough and cold products to be extrapolated to establish efficacy of the drugs in children under 12 . . . [and that] cough and cold drugs not be used in children under 6 years of age.” Currently, not even draft changes have been made to the monograph. She also noted that it is appropriate that the monograph be amended to provide dosing instructions for children under two years of age and that “if the monograph process worked better, surely this change would have happened years ago.”
  • Scott Melville, President and CEO of Consumer Healthcare Products Association (CHPA), notes the value that OTC medicines bring to the health of Americans and to the U.S. health care system and stresses that it’s important that the oversight process “is one that is efficient, transparent, and accommodating to innovation.” He also notes that his industry “is willing to supplement government resources with a modest user fee program.”
  • Kirsten Moore, Project Director, Health Care Products, The Pew Charitable Trusts, gave examples of the “unnecessary delay incorporated into a multi-step rulemaking system, which compromises FDA’s ability to respond swiftly to address new safety information and protect consumers” and urged Congress to pass the legislation as soon as possible.
  • Michael Werner, Partner, Holland & Knight, on behalf of the Public Access to SunScreens (PASS) Coalition, and Gil Roth, President, Pharma & Biopharma Outsourcing Association, also spoke in support of the OTC legislation.
  • Janet Woodcock, MD, Director for the Center for Drug Evaluation and Research (CDER) with the FDA confirmed the troubles with the current process and the present staffing levels raised by the other stakeholders. Her agency, as well as the other organizations, offered to continue to work with Congress to make the OTC reforms a reality.

FDA user fees reauthorized by House vote

In a bipartisan action, the House of Representatives today passed H.R. 2430, the FDA Reauthorization Act (FDARA) of 2017, by voice vote. FDARA reauthorizes the FDA’s user fee programs for prescription drug, medical device, generic drug, and biosimilar biological products. The current user fee programs are set to expire in September 2017 and account for almost a quarter of the FDA’s funding.

In April 2017, the House Energy and Commerce Committee, along with the Senate Health, Education, Labor and Pensions (HELP) Committee, released a discussion draft of the Food and Drug Administration (FDA) Reauthorization Act of 2017, reauthorizing the FDA’s user fee agreements (see Discussion draft of FDA user fee amendments is on the table, Health Law Daily, April 18, 2017). The draft followed a series of hearings examining the four individual user fee programs – the Generic Drug User Fee Amendments (GDUFA) and the Biosimilar User Fee Act (BsUFA), the Prescription Drug User Fee Act (PDUFA), and the Medical Device User Fee Amendments (MDUFA) (see HELP Committee hears ardent support for next round of user fee agreements, Health Law Daily, April 4, 2017 Committee holds optimistic hearing on medical device fees, Health Law Daily, March 29, 2017; PDUFA VI reauthorization would aid 21st Century Cures Act implementation, Health Law Daily, March 23, 2017; and User fee program reauthorizations necessary for product development, Health Law Daily, March 3, 2017).

FDARA is currently before the Senate (see HELP committee advances FDA user fee agreements to Senate floor, Health Law Daily, May 12, 2017).

Energy and Commerce committee unanimously approves FDA reauthorization

The House Energy and Commerce Committee voted unanimously—54 to zero—to approve H.R. 2430, the Food and Drug Administration Reauthorization Act of 2017 (FDARA), after a markup on June 7, 2017. The bill would reauthorize the FDA’s user fee programs for prescription drug, medical device, generic drug, and biosimilar biological products. Without the reauthorization, the use fee programs will expire at the end of September, 2017.

The FDARA would renew the FDA’s authority to collect user fees from the makers of prescription brand drugs, medical devices, generic drugs, and biosimilars. The fees account for more than one-fourth of the agency’s funding (see HELP committee advances FDA user fee agreements to Senate floor, May 12, 2017).

The bill passed the committee with six amendments, offered by: Chairman Greg Walden (R-Ore), Rep. Ryan Costello (R-Pa), Rep. Scott Peters (D-Calif), Rep. Mimi Walters (R-Calif), and Rep. Jan Schakowsky (D-Ill). Rep. Schakowsky offered two amendments. The amendments are designed to further the development of generic therapies, update approval and quality reporting requirements for medical devices, allow for risk-based classification of accessories, foster the development of medical device safety surveillance pilots, and encourage steps to lower the cost of prescription drugs.