FDA Appropriations In Senate: Money For Generics; Worry About Tobacco

Senate appropriators would like to see FDA spend $93 million in fiscal year 2010 on its generic drugs program.

Of that total, $51.5 million is earmarked for the Office of Generic Drugs in legislation approved by the Senate Appropriations Committee July 7 and must be spent for that purpose.

The remaining $41.5 million is a recommendation in the legislative report, and as such is non-binding, although FDA generally follows such directives. This additional money would be available for OGD, manufacturer inspections or generic-related activities at other divisions, such as the Office of Surveillance and Epidemiology.

If Congress approves a $36 million generic drug user fee program proposed by the administration, the committee expects the revenues to be an add-on to the $93 million, according to a staffer.

Legislative action on the generic user fee proposal has not yet been initiated.

The higher funding and imposition of user fees would enable FDA to reduce its ANDA backlog and speed approval and market entry of low-cost generics and provide savings to help pay for health care reform.

FDA spent $82 million on its generic drug program in fiscal 2008 and estimates FY '08 expenditures will be slightly higher at $82.2 million. If the agency spends at the committee's recommended level and the user fees are enacted, FY '10 outlays would total $129 million.

The $51.5 million for OGD is $10 million more than the current funding level for the office. The House on July 9 approved H.R. 2997, which provides a $5 million increase - $46.5 million - for OGD in FY 2010 (Also see "FDA Resources Maintain Upward Trajectory In House Appropriations Committee Bill" - Pink Sheet, 19 Jun, 2009.).

Both the Senate-reported and House-passed FDA appropriations bills provide FDA with the $3 billion budget proposed by the Obama administration, minus new user fees that were requested (Also see "Generic Drug Fees In, DTC Fees Dropped, From Obama Budget Proposal" - Pink Sheet, 18 May, 2009.). That sum includes both appropriations from the treasury and proceeds from existing user fee programs.

Funding for the Centers for Drug Evaluation and Research and Biologics Evaluation and Research are the same in both bills - $873 million for the former and $305 million for the latter.

A Public Health Agenda For FDA

But Senate appropriators provide FDA with more advice on how to divvy up the funds and more calls for reporting back than their House counterparts.

Many of their recommendations dovetail with plans by Commissioner Margaret Hamburg to make the agency a proactive protector of public health both domestically and abroad (Also see "Hamburg/Sharfstein Agenda For FDA Emphasizes Collaboration" - Pink Sheet, 1 Jun, 2009.).

The committee report recommends $18 million for the Critical Path Initiative. At least $6 million of this should finance critical path partnerships, the report says, with $2 million of the partnership funds spent to research treatment and/or rapid diagnosis of tropical diseases, as defined by Section 524 of the Food, Drug and Cosmetic Act.

In particular, the panel voices concern about tuberculosis and drug-resistant TB and directs CDER to find a partner to assist in developing new combinations of drugs for the rapid and effective treatment of tuberculosis.

FDA already has begun developing guidance for TB drug development (Also see "FDA Encourages TB Drug Development But Wary Of Promoting Resistance" - Pink Sheet, 22 Jun, 2009.).

In the antimicrobials arena, the report calls for the agency to write guidance for hospital-acquired pneumonia, ventilator-associated pneumonia and complicated skin and skin structure infections.

Regulatory uncertainty "has been a serious impediment to new antibiotic development," the report contends, pointing out that in 2001, FDA and CDC agreed to identify ways to promote the development of priority antibacterial drugs for humans and FDA should begin this work.

Antimicrobial resistance also is a concern of panel members, who call for FDA to reassess and rank antibiotics according to their importance in human medicine.

Panel Exerts Its Oversight Function

To keep tabs on FDA's progress, the panel requests the following reports:

A quarterly review of the CPI funds, particularly outlays for the partnerships, including information on the funding amounts and recipients and a description of each project and activity;

An outside study on ways to promote development of priority antibacterials; and

A report by Sept. 30, 2010, on what research is needed to evaluate the impact on patients of substituting bioequivalent anti-epileptic drugs and on FDA guidance for minimizing the side effects from switching.

The appropriators also ask that in its future budget requests, FDA provide more information on how it plans to spend its money.

The fiscal 2010 proposal included a 15 percent increase that was assigned to two major categories - food safety and medical product safety - "without any significant detail on how this funding would be used," the report complains.

In the future, FDA should provide a "high level of details" on funding for each budgetary theme and provide performance measures and outputs related to user fees separately from direct appropriations and independent of one another, the panel says.

FDA Commissioner Margaret Hamburg already is reorganizing her staff to create a single office that houses budget, policy and planning efforts so budget commitments and measurable outcomes can be better aligned.

Principal Deputy Commissioner Joshua Sharfstein pledged during appearances before the Senate and House appropriations panels in May that the agency would demonstrate the value obtained for the money it spends (Also see "Sharfstein Pledges FDA Spending Will Generate Public Health Value" - Pink Sheet, 25 May, 2009.).

An immediate concern of the appropriators is the impact of recent legislation giving FDA authority to regulate tobacco.

While the law sets up user fees, FDA must finance that endeavor with appropriations until a fee system can be put in place. The committee says it expects use of government money to be minimal.

Information on the specific activities from which appropriated funds are taken "and the impact this reduction in funds will have on the activity, if any," is to be provided to the committee on a quarterly basis.

Other specific recommendations include: $6 million for the Office of Women's Health and expenditure of the $98 million increase for medical product safety on items such as more foreign and domestic inspections and improved laboratory capacity; hiring and training staff to support blood, tissue and vaccine development; adverse event data collection and analysis; research on bioequivalence standards for generic forms of novel products; enforcement against fraudulent products; and upgrading and integrating IT systems.

- Cathy Dombrowski ([email protected])