Congress Passes Last-Minute Fix to Save FDA Generic Drug User Fee Funds

Leaves Unaddressed Device User Fee Funds

September 25, 2012

In a last-minute bid to save the generic drug user fee program, the Senate approved a bill that will allow the Food and Drug Administration to begin collecting new generic drug user fees on Oct. 1. The corrections bill, HR 6433, approved by the House on Wednesday and the Senate early Saturday morning, unties collection dates from the appropriations bill.

Congress’ decision to use a continuing resolution to fund the national government for the next six months would have prevented the FDA from reaching the baseline amount of taxpayer funds needed before the FDA could use the money paid by industry to support drug and device reviews. [FDA Layoffs and Extended Approval Times Anticipated if Budget Cuts Trigger Loss of User Fee Funds, Sept. 21, 2012]

By enabling the FDA to start the user fee program on Oct. 1, Congress secured for the FDA a total of approximately $1.5 billion paid by generic drug makers over the next five years. In return, the FDA has committed to hire more reviewers, which is expected to severely cut down on the backlog of 3,000 applications and reduce review times from the current average of 30 months down to 10 months.

Although Congress addressed the generic drug user fees, the future of medical device user fees remains unclear. With the passing of the continuing resolution, the FDA can only use the user fees paid by device companies up to the 2012 amounts, even though the device companies will begin paying fiscal year 2013 rates on Oct. 1. As a result, the FDA may be unable to hire the reviewers it needs to provide timely medical device reviews.