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DRUG APPLICATION USER FEES WILL INCREASE TO $162,000

Executive Summary

DRUG APPLICATION USER FEES WILL INCREASE TO $162,000 in fiscal 1994, an 8% jump over the target fee rate & for applications with clinical data, according to a notice in the Dec. 13 Federal Register. The notice announces user fee revenues and rates for fiscal year 1994, which began Oct. 1. The Prescription Drug User Fee Act projected that FY 1994 user fees for applications with clinical data would be $150,000 ("The Pink Sheet" Oct. 12, 1992, p. 3). During FY 1993, the fee for applications with clinical data was $100,000. The rise in application fees reflects the overall increase in total user fee revenues due to a 4.2% increase in applicable federal salaries. The user fee act provides that total fee revenues for each fiscal year will increase due to either the total percentage increase in the Consumer Price Index during the preceding fiscal year or the total percentage pay increase for federal employees, whichever is greater. "The FY 1994 total adjusted fee revenue amount then totals $52,284,200," FDA said in the notice. Therefore, the amount of revenues from each fee category -- application, establishment and product -- is $18,761,400, the agency noted. FDA determined the fee rate for applications with clinical data by dividing the adjusted total fee revenue from applications "by the equivalent number of applications projected to be submitted in FY 1994 (116)." Based on the adjusted revenues, fees for applications without clinical data and for supplements with clinical data, will be $81,000, one-half the fee charged for clinical applications. The annual establishment fee in FY 1994 will be $5,800 more than the projected fee of $88,000. The product fee will be a $400 increase over the previous target fee of $9,000. As it did for FY 1993, FDA estimates that 200 establishments and 2,000 products will qualify for fees in FY 1994. All application, establishment and product user fees are retroactive to Oct. 1. FDA explained that any application or supplement subject to fees that is submitted after Dec. 13 must be accompanied by the application fee established in the new schedule. FDA will contact applicants who submitted applications between Oct. 1 and Dec. 13 regarding any balance due. The agency will issue invoices for establishment and product fees for FY 1994 by Dec. 31, 1993, the notice says. "Payment will be due by January 31, 1994. FDA will issue invoices in October 1994 for any products and establishments subject to fees for FY 1994 that qualify for fees after the December 1993 billing."

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