Generic Drug Fees Could Be Based On Product Complexity

FDA seeks comments at Sept. 17 public hearing on issues surrounding development of an ANDA user fee program, including whether applications for more complex products should carry a higher fee and whether fees should be used to support postmarketing safety oversight.

FDA is weighing whether a future generic drug user fee program should charge different rates depending upon an application's level of complexity.

The issue of ANDA complexity is one of six questions about development of a new user fee program on which FDA seeks comment at a Sept. 17 public meeting. In general, the agency requests input on whether to pursue a generic drug user fee program and what its scope and structure should look like.

Although generic drug user fees have been included in FDA's budget request in recent years, they have not come to fruition due to less than enthusiastic support by the generic drug industry and the need for Congress to write authorizing legislation.

However, the issue is taking on a heightened focus at FDA under Commissioner Margaret Hamburg, who testified at a Senate appropriations subcommittee hearing in March that creation of a generic user fee program is a "very, very high priority."

Such legislative action could conceivably be folded into the next PDUFA reauthorization in 2012 or attached to a drug import safety bill or other legislation that could see action sooner. However, there is opposition inside and outside Congress to creating new industry user fees, and a key FDA appropriator, Rep. Rosa DeLauro (D-Conn.), chair of the House Agriculture Appropriations Subcommittee, recently expressed her opposition to a generic fee program (Also see "Generic User Fees Face Opposition From Key House Appropriator DeLauro" - Pink Sheet, 3 May, 2010.).

FDA asks stakeholders whether the same fees and performance goals should apply to all ANDAs under a new user fee program. "For example, should applications for more complex products pay a higher application fee to reflect the additional regulatory efforts they entail," FDA asks. "Should such differences be captured through differential goals?"

The question appears aimed at recognizing the time and resource issues inherent with some of the more challenging applications faced by the Office of Generic Drugs. These include products with complex delivery systems as well as complex compounds that raise novel issues, such as the recent approval of Sandoz's ANDA for Sanofi-Aventis' low molecular weight heparin Lovenox (enoxaparin) (Also see "FDA Approves Momenta/Sandoz' Lovenox Generic Without Need For Clinical Studies" - Pink Sheet, 23 Jul, 2010.). Citizen petitions that seek to block approval of first-to-file ANDAs also can present novel scientific and policy issues that take extensive time and resources to address.

Treating ANDAs differently based upon their level of complexity would appear to be a more complicated process than under PDUFA, which involves a straightforward fee breakdown according to whether a drug or biological application is an original or supplement, and whether it requires clinical data.

Under the prescription drug user fee system, all NDAs and BLAs requiring clinical data are assessed the same fee, which will reach $1,542,000 in fiscal 2011 (Also see "FDA Expects Sharp Drop In Drug Applications This Year" - Pink Sheet, 4 Aug, 2010.). Applications not requiring clinical data and supplements requiring clinical data are charged half the fee, or $771,000 next year. ANDAs, in contrast, generally do not include clinical data.

Building a fee system around complex issues raised by citizen petitions also would be difficult, as petitions usually are not filed until after an ANDA has been submitted.

Fees For Safety Oversight

FDA asks whether a new user fee program should support postmarketing oversight of generic drug safety, as currently occurs under the prescription user fee paradigm.

The 2007 PDUFA reauthorization enabled FDA to use fees toward a variety of drug safety initiatives. These include developing and implementing a five-year plan to modernize drug safety; bolstering pharmacovigilance tools and research capacity; and reviewing risk management plans.

FDA asks how, if at all, a generic drug fee program should differ from PDUFA and other fee programs for animal drugs, medical devices and tobacco products. It also asks whether a fee program should be structured according to the PDUFA model of one-time fees for applications and annual fees for marketed products and facilities. If the PDUFA fee structure is not favored for generics, "what are the unique aspects of the generic drug industry or market that should be considered and how might these impact a proposed user fee plan?"

The agency wants to know what, if any, performance goals should accompany a generic fee program.

The Generic Pharmaceutical Association has said it favors attaching performance goals to fee payments but that these goals should extend across the various offices within FDA that are often asked to weigh in on ANDA issues, such as the Office of the Chief Counsel and the Office of New Drugs (Also see "ANDA User Fees: Industry Takes Holistic Approach, Wants Whole New Office" - Pink Sheet, 8 Mar, 2010.).

Finally, the agency inquires as to how pending ANDAs should be treated under a new fee system.

The current ANDA queue totals more than 2,000, including applications for which exclusivity would prevent current marketing or that are awaiting responses from sponsors for deficiencies. Approximately 800 new applications are submitted each year.

FDA says it is not seeking comments on policy matters and that meeting participants instead should focus on process and funding issues.

However, policy issues often go hand-in-hand with debates over generic drug approval processes and funding, and it seems unlikely that commenters will not want to discuss potential policy changes.

GPhA has advocated for a number of changes to speed generic approvals, including restructuring the Office of Generic Drugs, putting an increased focus on review for first-time generics, and creating a position within the commissioner's office to oversee generic drug issues.

-Sue Sutter ([email protected])