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Executive Summary

NDA OUTSIDE REVIEWS FUNDED WITH OPTIONAL USER FEES was floated as an idea at a Jan. 14 conference sponsored by the Competitiveness Enterprise Institute, a free-market think tank based in Washington, D.C. CEI General Counsel Sam Kazman explained that the combination of user fees with extramural reviewers could help FDA both increase its budget and decrease individual reviewer workloads. Making the user fee optional addresses the "serious problem with the whole notion of having agencies charge people and charge companies" for a service that historically has been free, Kazman said. At the same time, the use of outside reviewers addresses what he called another "fundamental problem" -- FDA's inherent "over-caution" in reviewing new products before allowing them to enter the market. " If you couple these...tendencies with the notion of mandatory user fees, it seemed to us that" the result is "a very dangerous combination" that simultaneously costs "quite a bit" and offers "pretty speculative" benefits, Kazman said. On the other hand, he continued, if FDA were to "establish user fees for [processing] NDAs but [not] make them mandatory," a company could choose not to pay them and "nothing would change" from FDA's normal review of its NDAs. "However, if a company did pay the user fee, [the revenue] in a sense would go to purchasing review of the NDA by an outside entity," Kazman said, and FDA "would act as the contracting agent between the pharmaceutical firm and the outside reviewer." John Cohrssen, staff chief of the Vice President's Council on Competitiveness noted that the council's recommendations for reforming FDA's drug approval process include the concept of user fees for outside reviews. The council recommended outside reviews be tried and evaluated for two years before experimenting with charging for them. "By February 1993, FDA will evaluate its experience with FDA contracting out to develop another option for external review that draws upon additional resources from the private sector," the council's fact sheet states. "This option would provide companies the opportunity to use FDA-approved, non-governmental organizations to review their clinical data for a fee." Industrial Biotechnology Association VP-Government Affairs Lisa Raines said IBA supports the Competitiveness Council recommendations for expedited approvals. However, Raines said, her association opposes user fees because they could become a substitute rather than an enhancement for FDA appropriations. In addition, she said, fees charged for NDA review would punish firms that develop new drugs as a "tax on innovation."

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