Just as the various User Fee Acts (UFA) go to congress for mark-up and reauthorization, a proposed administration budget contains a suggested doubling of fees charged for medical product reviews. Am I seeing this correctly? Industry and FDA have worked tirelessly over the last year and a half to get the various User Fee programs negotiated for reauthorization and at the 11th hour, this bombshell drops. Does this place all the UFAs into chaos? What does this mean for the pharmaceutical industry? And more importantly-what will this mean for patients?
Everyone has been complaining about prescription drug prices. Everyone says that more generic drug approvals are a way to address at least part of the drug pricing problem. But now you want to double the fees the industry pays for medial product reviews? Who do you think is going to pay for those fees? The drug companies will pass the increase in costs onto the wholesale price of the drug, so it will be the consumer (either directly or indirectly) who foots the bill.
A short 5 years ago, there were no fees for generic products review. The fact that the first drug product user fee act was first passed in 1992, under the Prescription Drug User Fee Act (PDUFA) speaks to the societal fact that getting quality low cost generics appeared to be an appropriate expense for appropriated funds that would deliver the biggest bang for the buck. But with the increase in workload seen by the FDA review component, who are charged with review and approval of generic drugs, the FDA and industry agreed to institute a Generic Drug User Fee (GDUFA) program that was specifically designed so as to not add more than 5-10 cents per prescription. Well, the initial funding level back in October 2012 was $299 million and now the negotiated GDUFA II starts out of the gate at $493.6 million. Does the budget suggest that the fees should be raised to $1 Billion a year (adjusted for inflation)?
Well, that will certainly get some smaller players out of the market by significantly raising the barrier to entry and will add a much more substantial cost to each and every prescription – exactly what everyone is complaining about and wants addressed.
Lots of people suggest that the government should be run more like a business and perhaps that is why we are where we are today. However, a business is designed to make a profit, not take care of a nation. The nation has responsibilities to its citizens and that is why we pay taxes. There is no doubt that the taxes collected should be used in the most fiscally responsible manner. The FDA used to be funded strictly from appropriated funds and, with User Fees, the goal was to supplement Agency funding, not replace it. Has everyone lost sight of the purpose of the FDA to protect the public health by approving safe and effective drugs, watching over the food supply, dietary supplements, compliance in the industry, medical devices, and other numerous tasks that Congress had layered onto the FDA by the passage of various laws? It is getting to a point where I am having trouble seeing the forest for the trees. Can someone please explain this to me?