FDA, drug makers cut deal to boost fees, staff

A landmark deal brokered by the prescription drug industry and the Food and Drug Administration would provide that fees that drug and biotechnology firms pay to the agency to speed up drug approvals could be used to ensure the drugs' safety after they reach the market, sources said.

The draft proposal, which the administration has not yet officially approved, comes as Congress considers reauthorizing the Prescription Drug User Fee Act, which expires this year. The new proposal could form the basis of legislation being drafted by the House Energy and Commerce Committee. The committee plans to mark up a bill in the next six weeks.

The Energy and Commerce Health Subcommittee will hold a hearing on PDUFA Wednesday, with witnesses from FDA and the industry discussing potential changes to the law.

According to key sources, the deal would roughly double the size of FDA's Office of Drug Safety by funding an additional 100 or more new staff members over the next five years.

Congress and administration approval of this aspect of the proposal would be a major victory for FDA, which has been seeking additional funds to help it monitor drug safety.

The drug safety funding also represents a departure for the Pharmaceutical Research and Manufacturers of America, which had been calling for a "clean extension" of the program.

"We do not see the need for overall reform," PhRMA President Alan Holmer said in a briefing in January.

The FDA-industry proposal would boost the overall PDUFA program by several million dollars over current funding levels and allow FDA drug reviewers to maintain some flexibility in dispersing the funds among various products, sources said.

FDA estimates it will receive $325 million for drug reviews in fiscal 2002. About half will come from industry in the form of user fees.

The deal would not require FDA to speed review times at the agency beyond current requirements--10 months for regular products and six months for products given an expedited designation. However, it may require FDA to better assist the industry before the formal application process.

In January, Holmer said disappointing review times would be addressed in PDUFA.

However, lawmakers who want to expand the law or address other FDA reform issues, or the Department of Health and Human Services or the Office of Management and Budget, could add more items.

FDA and the drug industry have been talking for months about how to structure a proposal. They finally reached the tentative deal Friday, sources said. Congressional aides were briefed Monday and Tuesday. FDA and PhRMA declined to comment on the negotiations.