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FDA REPORT CARD ON PRODUCT REVIEW ACTIVITIES WOULD BE RELEASED ANNUALLY UNDER USER FEE PROPOSAL; PMA BOARD TENTATIVELY AGREES TO PLAN AT SEPT. 3 MEETING

Executive Summary

FDA would prepare annual report card summaries for the public to chart the agency's drug review activities as part of an agreement between FDA and industry over user fees. The annual agency report card would outline FDA's review goals and its progress in reducing backlogs. Under the proposal, FDA has agreed to report on its performance in meeting annual "interim" goals from FY 1993 to FY 1997. Beginning in FY 1997, FDA has agreed to meet certain performance goals as a trade-off for industry funding through user fees. The month of August saw a flurry of unusual negotiations between FDA and the representatives of pharmaceutical companies that support the concept of user fees to enhance agency revenues. Out of those discussions a proposal for user fees on brandname prescription drugs emerged during the week of Aug. 31. The proposal worked out by FDA and PMA representatives will serve as the basis for proposed legislation that has a very narrow window to get through Congress before an Oct. 3 target adjournment date. The PMA board gave a tentative approval to the proposal at a Sept. 3 meeting in Washington. A proposed bill is expected to be in legislative form early in the week of Sept. 7. Rep. Waxman's (D-Calif.) Energy & Commerce/Health subcommittee, as of Sept. 4, had not yet scheduled a markup. In a Sept. 3 press statement issued after the board of directors meeting, PMA said the board "was pleased with the progress and believes the work by the PMA and FDA groups forms a solid basis for going forward." The statement adds, however, that the board "reached no final decision on user fees...pending review of legislative language and the form and substance of the commitments by the Bush Administration and the relevant congressional committees." Reportedly, the latest user fee proposal will include review fees, establishment fees and annual product registration fees. The review fee for NDAs and PLAs would range from $150,000-to-$ 200,000, while efficacy supplement reviews would cost half that amount. FDA also wants to limit refunds in cases where the agency refuses to file an application to 75% of the user fee amount. One significant point of contention regarding payments for product reviews may still remain. FDA apparently would like companies to pay the full review fees up-front at the time of submission; drug industry negotiators would prefer incremental payments. In addition, the proposal reportedly sets establishment fees at roughly $50,000 and annual product registration fees at $5,000. Each strength or dosage form would be considered a separate product by FDA when assessing fees. The agency is hoping to raise a total of $350 mil. over the next five years from pharmaceutical user fees or approximately $70 mil. a year. In return, FDA has agreed to establish certain performance goals that the agency agrees to meet after collecting five years of user fees. The performance goals include completion of standard NDA and PLA reviews within 12 months and priority reviews within six months. The performance goals are not expected to be included in the bill's language; PMA is understood to want "intent of Congress" language somewhere in the legislative history.
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