User Fees to Fund Faster Reviews

by Food and Drug Administration (FDA)

The road to gaining FDA approval to market a new prescription drug or biologic can be a lengthy one. By law, FDA must review clinical test results for any new drug or biologic to ensure the product is safe and effective. Because of staff shortages, limited resources, and incomplete submitted applications, it takes an average of 22 months for approval from the time companies apply to market products. But that is changing.

Resources provided by the Prescription Drug User Fee Act of 1992 will help FDA shorten review time significantly over the next five years. The agency has started collecting "user fees" — charges levied on pharmaceutical companies for certain new drug and biologic applications, drug products, and manufacturing establishments covered under the act. FDA will use these funds to hire more reviewers to assess applications. At the same time, the agency is streamlining drug and biologic review processes.

FDA hopes to employ about 600 new drug reviewers and support staff by the end of fiscal year 1997, nearly half of whom are now on the job. To support these new staffers, the agency expects to collect more than $325 million in user fees over the five years covered by the 1992 act. Unless Congress renews the act, the user fee law will expire at the end of FY 1997.

New employees are working in either FDA's Center for Drug Evaluation and Research or Center for Biologics Evaluation and Research. They include medical officers, chemists, microbiologists, and pharmacologists, along with other professionals and support staff. They also are helping FDA with its backlog of overdue applications.As of Nov. 30, 1994, FDA had cleared all but nine applications from the backlog. Agency officials say the backlog should be completely eliminated ahead of the mid-1995 target date.

As for new applications, FDA aims to reduce review times to 12 months for "standard" applications and to six months for "priority" applications. Applications for drugs similar to those already marketed are designated standard, while priority applications represent drugs offering significant advances over existing treatments. (Drugs for AIDS and cancer typically fall into the priority category.) Goals for shortening review times and for hiring more staff will be phased in gradually over the five-year statutory period.

User fees are funding a way to accelerate reviews through use of computer technology. Through this program, dubbed the "Smart Initiative," FDA is establishing standards for the software drug companies use in preparing data for submission to the agency. Eventually electronic data submission is expected to virtually eliminate the need for huge paper submissions and also to reduce the application review time. In a 1994 pilot program, FDA was able to approve electronic submissions 11 months faster than similar submissions on paper.

Although FDA is accelerating its review time, the agency remains committed to high review standards. Newly initiated programs are helping ensure the quality and integrity of the review process.

The prescription drug and biotechnology industries, particularly the Pharmaceutical Research and Manufacturers of America (PhRMA) and several biologic product trade associations, support user fees to bolster FDA's review process. About 175 drug and biologic companies are affected by the user fee law.

The pharmaceutical industry also will play a major part in helping the agency achieve user fee performance goals. For example, FDA will depend on companies to improve the overall quality of submissions and to provide timely responses to questions about applications. The agency plans to work closely with industry on programs to improve the quality of the drug and biologic submissions. FDA also will enlist information technology to help speed review of the massive amounts of data submitted in drug and biologic applications.

A Long History

User fees are not a new concept. FDA has charged fees for color certification and insulin certification for more than 40 years. FDA first considered drug review fees in 1971 when the General Accounting Office recommended to Congress that FDA charge such fees. GAO's report cited the authority federal agencies were given to levy user fees under the Independent Offices Appropriation Act of 1952. But after weighing pros and cons — such as whether fees would burden small businesses or be passed on by firms that pay them in the form of higher prices — FDA's parent agency, the former Department of Health, Education, and Welfare, rejected the proposal.

About the Author

www.fda.gov
FDA is A United States government body that oversees medical devices, including contact lenses, intraocular lenses, excimer lasers and eyedrops. In the US, these products must be approved by the FDA before they can be marketed.