OFW Law Celebrates 35 Years of Successes in Drug/Healthcare Privacy Practices (Part III)
In celebrating 35 years of practice, OFW Law’s Drugs, Biologics, and Controlled Substances and Healthcare Privacy practice groups are taking a look back to share some highlights throughout the years. Parts I and II focused on Hatch-Waxman and medical privacy laws, while today’s blog looks at how user fees transformed the FDA. Please stay tuned for Part IV, which will provide a review of the changes in prescription drug supply chain requirements.
One important shift at FDA over the past 35 years is the substantial decrease in FDA review time of new drug applications (NDAs), biologic license applications (BLAs), and abbreviated new drug applications (ANDAs). This improvement, of course, did not come cheap.
Since the 1950s, FDA entertained the mechanism of user fees to provide additional resources for rapid review of pending applications; but industry resisted. Over the years, FDA’s time to review NDAs stretched ever longer. By 1987, the average time for FDA to make a decision was a staggering 29 months. With applications stuck in never-ending review, industry began to see the potential benefit of user fees in order to get products through FDA and onto the market faster.
Congress also came to see the potential harm to public health in the lengthy NDA and BLA approval process that delayed the availability of life-saving therapies. In 1992, Congress passed the Prescription Drug User Fee Act (PDUFA) and so the bargain was struck. NDA sponsors would pay considerable fees to the agency and, in exchange, FDA committed to reviewing the applications on set timetables. By the time PDUFA was up for its first reauthorization in 1997, NDA median approval time for NDAs and BLAs dropped significantly to 12.5 months for standard applications and 7.8 months for priority applications.
PDUFA has been reauthorized four times since 1992, most recently in 2012 with PDUFA V. PDUFA V will sunset in October 2017. With each authorization, FDA has been required to provide annual reports on progress in meeting targeted review times. The most recent reports indicate that the program continues to do well, meeting review time goals nearly 100% of the time.
Delays in the review of ANDAs began to creep up in the 1990s and 2000s, ultimately creating a significant back-log of pending applications for generic drugs. As of 2011, ANDA review took approximately 31 months (or 2.5 years) on average. Relying upon the same premise as PDUFA, Congress passed the Generic Drug User Fee Act (GDUFA) and Biosimilar User Fee Act (BSUFA) in 2012 to expedite the approval process for generic drugs and biosimilars. Though FDA has committed to reviewing 90% of ANDAs within 10 months, there remains a significant backlog of pending applications. In 2013 there remained a backlog of 2,866 original ANDAs and 1883 supplements. In year 2013, FDA was able to provide 45% of the backlog with first action.
User fees have resulted in a huge budget increase for FDA. By 2013, FDA had collected $729 million in user fees since the inception of PDUFA. Drugs are getting to market faster – FDA met its 2013 goal to review 90 percent of standard NDAs and BLAs within 10 months. FDA’s 2013-2017 user fee performance goals are very aggressive. By 2017, FDA aims to:
- Review ninety percent (90%) of standard new molecular entities (which are the most complex NDA) within 10 months of filing acceptance and 90% of priority applications within 6 months of acceptance;
- Review ninety percent (90%) of complete electronic ANDAs within 10 months; and
- Review and act on ninety percent (90%) of biosimilar applications (applications under §351(a)) within 10 months.
Fees are set annually based upon the agency’s actual costs and vary by program. For fiscal year 2015, the application fee for NDAs with clinical data are $2,335,200, ANDAs are $58,730, and Biosimilar Product Application Fees are $110,370 (other user fees for supplements, reviews with and without clinical data, manufacturing sites, and products may also apply).
Despite the reduced backlogs and faster reviews of lifesaving drugs and their generic equivalents, the user fee programs have been roundly criticized as well. FDA is, after all, receiving direct and substantial financial support from the entities it regulates. While we can appreciate that critique, in our experience, it is unfounded. Over our 35 years of observing the drug approvals, user fees are making the process faster and more predictable but have definitely not impacted the quality and rigor of FDA’s review. Indeed, we have found that review standards have significantly tightened over the years and applications that would have slid through the review process 30 years might not even be accepted for review today.
In our view, user fees have helped industry and the agency, with benefits to patients who more expeditiously receive critical drug therapies.
