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USER FEE BILL HOLDUP THREATENED AT HEARING BY SEN. HATCH, CITING FDA REGULATION OF VITAMINS; SENATE LABOR COMMITTEE MARKUP SCHEDULED FOR SEPT. 29

Executive Summary

FDA's regulation of dietary supplements and medical devices could become a sticking point in the user fee bill's progress through the Senate. During a Sept. 22 Senate Labor and Human Resources Committee hearing, Sen. Hatch (R-Utah) voiced several "concerns" about the user fee bill and launched an uncharacteristic attack on FDA -- which appeared to stem partly from concern about supplements. The committee's ranking Republican said he was "not opposed to a user fee bill, if it's done right." However, "it seems to me the House bill has a ways to go." The House passed the bill (HR 5952) by voice vote on Sept. 22. The Labor & Human Resources Committee tentatively has scheduled a markup of the measure as early as Sept. 30. In his opening statement, Hatch asked "what's the impetus for this big rush" to pass the legislation, and he maintained that appropriations would constitute "a far cleaner way to provide resources to the FDA." Before adopting user fees, the Utah Republican said, "we must make sure that the FDA has exercised sufficient fiscal self-discipline" and "examine the impact of FDA's recent trend toward a top-heavy bureaucracy on the agency's productivity and effectiveness." Noting Commissioner Kessler's creation of "a new layer of" FDA deputy commissioners, Hatch asserted that "a rigorous self- examination would be a good start in finding ways to improve the agency's performance, a key goal of the user fee proposal." The senator contended that "the recent trend toward selective enforcement is more than worrisome." Because "a more comprehensive look a the whole agency is needed," he urged "the committee to undertake such oversight as a high priority, after which we can fashion a common sense, effective solution to FDA's resource needs." Hatch's staff has been involved with aides to committee Chairman Kennedy (D-Mass.) and the House in a joint effort to draft the user fee legislation, which has broad support throughout the brandname prescription drug, biologic and biotechnology industries. Consequently, his assault on the bill may not indicate so much his concerns about legislation he helped to shape; rather, it may have been a reflection of his concerns about Kessler and the commissioner's activist philosophy, particularly regarding the regulation of dietary supplements and medical devices. Kennedy said in his opening statement that he and Hatch "hope to expedite action by the Senate" on the bill. The chairman added that his colleague "has been indispensable to the ongoing discussions." One of Hatch's stated concerns about the bill is "regulatory creep," either through "unreasonably" expanded fees or extension of the program "unwisely to other industries for which user fees would be neither welcomed nor justified." Other concerns include whether the measure's product and establishment fees constitute a tax, whether FDA can speed new drug approvals meaningfully and future commissioners "will continue to aim for [the bill's] nonbinding performance goals" and how user fees will affect drug prices. Hatch also noted that one company has estimated it will pay $130 mil. in fees over five years. The company reportedly is Merck. Kessler has not ingratiated himself with the food and medical device industries. New regulations to implement statutory requirements that label claims on dietary supplements and foods reflect consensus opinion among scientists are being drafted during Kessler's watch. He has also initiated FDA action against claims of freshness by makers of orange juice and restriction of breast implants. The commissioner, whose term in office it is predicted will end ended by early next year, has lobbied vigorously for a user fee program, possibly with the hope of making it his final act in strengthening the agency. Hatch has indicated that he may develop an amendment to the user fee bill to bar FDA's restriction of labeling for dietary supplements until Congress can hold comprehensive hearings on the regulations next year. Kessler has emphasized repeatedly, as he did again at the Senate hearing, that the Bush Administration's support of user fee legislation "is conditioned on a 'clean bill.'" Kessler urged that the bill "not become a vehicle for extraneous and unrelated proposals." The Utah Republican noted that the Senate, in passing a 1993 HHS appropriations bill, "overwhelmingly" adopted his amendment providing "a one-year moratorium for dietary supplements." Congress and FDA "need that additional time in order to work out the differences" on vitamin labeling, Hatch said. "It's no secret that I'm not very pleased with the way FDA's moving on" the Nutrition Labeling & Education Act. Kessler replied that he personally agreed with the senator that there might be some benefit in a moratorium. He said he was "not sure" the moratorium is needed for the reg's labeling requirements, "but with regard to health benefits and health claims of dietary supplements, personally, I think there may be some benefit in a one-year moratorium." Kessler emphasized: "I am just speaking for myself." Hatch asked about the views of "the rest of FDA" and the Bush Administration on vitamin regulation. Kessler answered that the Administration and the agency "are committed to working with you." Hatch faces resistance to his amendment in the House. Energy & Commerce Committee Chairman Dingell (D-Mich.) wrote a Sept. 22 letter to House HHS Appropriations Committee Chairman Natcher (D- Ky.) asking that the Hatch amendment be deleted from the legislation during House-Senate conference. Dingell said the Hatch amendment on the HHS appropriations measure "has the effect of amending the NLEA," which is within the jurisdiction of Dingell's legislative committee. NLEA requires that regulations be published by Nov. 8, 1992, the letter points out, and the Hatch amendment "clearly changes substantive law." Dingell added: "I do not agree that such initiatives are warranted through this appropriations bill and without hearings. I strongly urge your rejection of these provisions." Sen. Durenberger (R-Minn.) asked about the effect of the legislation on medical device manufacturers, many of which are based in his state. Kessler responded that, although new device review "time is going to double if we don't do something about it," the discussion to include the device industry in the user fee program is one "that we don't have time for this session, but it needs to take place next year." Durenberger also expressed concern about the possibility that FDA will be forced either to increase its fees or to shift resources away from other important agency programs, including devices, to meet the drug review performance goals. Pharmaceutical Manufacturers Association President Gerald Mossinghoff concurred that there must be congressional oversight of how FDA meets its performance goals, stating: "I totally agree with Sen. Durenberger's remarks." Meeting those goals "is not going to be easy," Mossinghoff said. "It is going to take continuing oversight by your committee to make sure that those user fees continue to flow from our industry" and that "the government keeps its word in achieving its commitments." He added: "We will be loud in our complaints if there is some backsliding here, and we will look to you and your colleagues to help us." FDA's performance goals were stipulated in Sept. 14 letters to the House and Senate ("The Pink Sheet" Sept. 21, p. 5). Roche President and CEO Irwin Lerner, who chairs the PMA board's committee on FDA issues, testified that oversight of the user fee program also will be conducted by a newly established "joint Industry/FDA Working Group." The joint working group will "develop and oversee programs to improve review times," Lerner said. Lerner also pointed out that PMA has been working with FDA to develop the user fee program because "either more resources are provided, or there is going to be [a reduction in] the flow of new drugs, particularly those in the area of biotechnology, in the future." The industry's choice, "at this point in time," Lerner said, "is to provide the added human resources necessary to move that logjam forward and to bring the benefits that [new drugs] will convey to the public." Hatch asked Kessler whether the Bush Administration had cleared the agency's performance commitments. Kessler replied that his letter to Congress, which spells out the goals, was approved by "all review processes, including [the Office of Management & Budget] review."
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