2006 Budget Request Aims To Build Drug Safety; OTC Spending Likely Flat

The Bush Administration's fiscal 2006 budget request represents a shift in resources toward drug safety activities within the Center for Drug Evaluation & Research.

The request includes an additional $5 mil. in funding to hire 20 new FTEs for the FDA Office of Drug Safety. The new positions will be added on top of five new user fee-funded positions to raise total staffing in ODS from 109 to 134.

FDA plans additional new spending from other funding to support drug safety, Associate Commissioner for Management Kathleen Heuer said during a Feb. 7 media briefing.

"We are going to be implementing a number of strategies," including expanding "access to large clinical and drug use datasets for detecting adverse events and medication errors and for conducting population-based safety studies," Heuer said.

FDA also will be pursuing "linkage of these datasets to increase the power to detect the problems" and "development of strong analytic tools to rapidly identify signals." Finally, the plan will include new ideas for "timely, thoughtful and actionable communication of information to healthcare providers and consumers."

"That's just a preview of what is going to be coming, and you will be hearing about this in the next several weeks," Heuer added.

FDA will announce the next phase of its drug safety initiative before the end of February, she said.

"There will be additional pieces of the plan that will be rolled out in the very near future - within the month - so stay tuned for that," Heuer reported.

FDA unveiled a five-part drug safety initiative in November, on the eve of a Finance Committee hearing into the agency's handling of the withdrawn COX-2 inhibitor Vioxx . The centerpiece of the plan was a top-to-bottom review of drug safety regulation in the U.S. by the Institute of Medicine.

FDA's FY 2006 budget proposal represents a more immediate response by increasing the resources available to ODS to conduct post-marketing surveillance activities.

Heuer outlined the allocation of new positions. Six of the new FTEs would be assigned "to establish policies and processes regarding safety reviews and risk management; manage communications with the Office of New Dugs; and support patient safety initiatives with external partnerships and with other HHS agencies" such as the Centers for Medicare & Medicaid Services and the Agency for Healthcare Research & Quality.

Ten of the FTEs would be assigned to the three operating divisions within ODS to "handle the increased workload with monitoring biological therapeutics; increase coordination and communication of safety review activities within the divisions; increase focus on medical error signal detection; and address current backlogs of unaddressed potential signals," Heuer said.

Finally, four FTEs would be "dedicated to evaluating and communicating drug safety risks to the healthcare community and the American public."

The five user fee-funded positions would be earmarked under the terms of the Prescription Drug User Fee Act to ensure that ODS completes reviews of risk manage-ment programs in accordance with performance goals negotiated with industry.

Overall, the Administration is proposing to increase ODS' budget from $26.9 mil. in the current fiscal year ($17.9 mil. from appropriations, $9 mil. from user fees) to $33.4 mil. in fiscal 2006 ($22.9 mil. in appropriations, $10.5 mil. in user fees).

However, the Administration is proposing to offset the increase in ODS personnel with cuts in other functions in the Center for Drug Evaluation & Research.

The budget request proposes to cut the CDER workforce by 55 positions in non-user fee and drug safety positions.

The ODS increase is essentially a reallocation from within CDER. The budget request assumes a reduction of 11 in CDER's headcount due to attrition, three FTE cuts from "administrative efficiencies" and six from information technology streamlining.

The net impact is that non-user fee-funded employment in CDER would be unchanged at 1,380.

User fee-funded positions are slated to increase by 17, including five slots assigned to ODS. As a result, overall employment at CDER would increase from 2,395 to 2,412.

Field employment associated with drug activities, however, is projected to decline in fiscal 2006. The budget request envisions 33 positions reduced by attrition, and two more by "administrative efficiencies."

The user fee program will fund one new position in fiscal 2006, leading to a net reduction in field employees associated with drug activities from 698 to 664.

Overall, the Administration is proposing to increase FDA's budgeted appropriations by 3.4% to $1.5 bil. Counting user fees for prescription drugs, devices, animal drugs and other services, FDA's budget is slated to increase by 4.5% in fiscal 2006 to $1.88 bil.

While the budget request does not break out allocations for OTC drug activities, CDER estimates suggest spending on nonprescription drug initiatives will be relatively flat again.

The fiscal 2005 budget request called for no increase for OTCs, following a 2004 proposed increase of $1 mil. to support Rx-to OTC switches. The 2004 increase was reduced to $650,000 in the final budget (¹ (Also see "FDA 2005 Budget Request Omits Boost For OTCs, Asks For CDER FTE Cutbacks" - Pink Sheet, 9 Feb, 2004.), p. 16).

In a summary of full costs of CDER programs, the agency projects the fiscal 2006 cost of "improving the efficiency and effectiveness of the over-the-counter drug review program to ensure a safe and effective drug supply is available" to be $16 mil.

The price tag is the same figure as fiscal 2005, which represented a $2 mil. increase over fiscal 2004.

CDER renews its existing goals to "complete review and action on 100% of Rx-to-OTC switch applications within 10 months of receipt" and to "make significant progress" on completing six OTC monographs.

The center estimates it will increase the number of OTC monographs published from six to 11 during 2005, and the estimate for 2006 shows no increase beyond that figure.