FDA Accord With Drugmakers Raises User Fees 6% to Renew Law

Drugmakers such as Pfizer Inc. (PFE) and Eli Lilly & Co. (LLY) agreed with regulators on a 6 percent increase in review fees as part of reauthorizing the drug-approval process through fiscal 2017.

The deal, disclosed in part today, would renew for five years a federal law funding Food and Drug Administration evaluations of brand-name drugs. Congress must approve the accord before the law expires on Sept. 30, 2012.

The increase is expected to add $40.4 million to user-fee revenue in fiscal 2012, bringing the fiscal 2013 total to $712.8 million, Karen Riley, a spokeswoman for the FDA, said in an e- mail. The agency in turn will have to meet with companies in the midst of reviews to raise concerns and ensure that evaluations are carried out in a timely way.

The agreement “should allow more timely access to safe and effective new medicines,” said David Wheadon, senior vice president for scientific and regulatory affairs at lobbying group the Pharmaceutical Research and Manufacturers of America, in a statement.

Drugmakers fund about 60 percent of the cost of agency reviews, according to the FDA. The agreement includes additional review time for the agency to fit in extra meetings, extending the window for reviews after submitting applications to eight months from six months, and 10-month periods to 12 months.

The FDA and the industry also agreed to meet 12 days before the agency convenes advisory panels that evaluate drugmaker applications, giving companies time to gather needed data, according to the draft.

Third-Party Reviews

The agreement includes a third-party review of whether the FDA is meeting drug-review goals, according to the draft.

Drug safety also will be strengthened through standardization of the requirements for risk strategies the FDA mandates of some medicines and support for the use of an online drug safety tracking system to assess post-market risks, Wheadon said.

The last time user fees were reauthorized in 2007, Congress gave the FDA new responsibilities to promote drug safety including requiring risk strategies for some drugs, which caused the agency to slow its review process.

‘Restoring’ Review Performance

Jim Greenwood, president of the Biotechnology Industry Organization, a lobbying group in Washington for biologic drugmakers, said in a statement the agreement “would restore FDA’s review performance.”

Companies such as New York-based Pfizer and Eli Lilly of Indianapolis have been discussing with the FDA a user-fee renewal since July 2010. Medical-device companies such as New Brunswick, New Jersey-based Johnson & Johnson (JNJ) are in separate talks on fees they pay the agency for product reviews.

The device industry rejected the agency’s proposal to more than double fees to $770 million across five years from $295 million, according to meeting minutes. Manufacturers are insisting on a safeguard against 11th-hour requests from regulators that the industry says delay approvals, according to Steve Ubl, president of the Advanced Medical Technology Association in Washington.

To contact the reporter on this story: Anna Edney in Washington at aedney@bloomberg.net.

To contact the editor responsible for this story: Adriel Bettelheim at abettelheim@bloomberg.net.

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