Earlier this month, the House of Representatives Energy and Commerce Subcommittee on Health held a hearing on the reauthorization of the Prescription Drug User Fee Act (PDUFA). The hearing, entitled, “PDUFA V: Medical Innovation, Jobs, and Patients,” was held in room 2123 of the Rayburn House Office Building.
Congress first authorized PDUFA in 1992 and last reauthorized the user fee in the Food and Drug Administration Amendments Act of 2007 (FDAAA). Under the user fee authority, FDA collects funds from drug sponsors to help expedite the human drug approval process. In FY 2009, FDA spent a total of $855 million on the review of human drug applications. $512 million of that total came from user fees.
As part of its agreement with industry on these fees, FDA committed to attain certain performance goals, including reviewing 90 percent of priority new human drug applications within 6 months and standard new human drug applications within 10 months.
The funds collected come from the following three basic types of user fees: application review fees, establishment fees and product fees. Under the application review fee, drug manufacturers pay fees for FDA’s review of new or supplemental drug approval applications and biologic license applications.
For FY 2011, the fees are $1,542,000 for each application requiring clinical data, $771,000 for applications not requiring clinical data and $771,000 for supplements requiring clinical data. Another user fee is the establishment fee under which a manufacturer must pay an annual fee for each manufacturing establishment. This fee is just under $500,000 for each establishment. The third fee is the product fee. Under this fee, the manufacturer must pay an annual fee of approximately $87,000 for certain products.
Following the process prescribed by statute, FDA and industry recently negotiated an agreement regarding the size and scope of the user fee for FY 2013-2017. On September 1, 2011, FDA will publish the details of the agreement recommendations on its website. A public meeting on the recommendations will follow in October 2011.
By January 15, 2012, FDA must send its final recommendations to the Committee and the Senate HELP Committee as required by statute. PDUFA IV expires on September 30, 2012,
In the past, these user fee reauthorizations have been viewed as opportunities to examine and improve the FDA regulatory process. The hearing presents a chance for Members to hear from FDA and other witnesses on the issues that the Committee should consider in reauthorizing PDUFA.
In his opening statement, Health Subcommittee Chairmen Joseph Pitts (R-PA) asserted that the reauthorization of PDUFA “is too important to leave to the last minute” because the drug industry employs thousands of people in the United States and provides good jobs that America cannot afford to lose.
Energy and Commerce Chairmen Fred Upton (R-MI) also submitted an opening statement, in which he acknowledged the importance of addressing concerns about the lack of predictability and certainty at FDA, which appear to be stifling American innovation, costing American jobs, and hurting American patients. Mr. Upton also noted that the Committee would review the risk/benefit analysis used by FDA when approving drugs and whether the agency is striking the right balance on this delicate issue. He note that there are concerns that FDA is failing to consider the views of patients who need access to life-saving drugs, including those drugs that carry some risk.
Moreover, Upton note that the Committee would evaluate provisions of FDAAA, including those affecting advisory committees and Risk Evaluation and Mitigation Strategies (REMS), as well as the rigid and unrealistic conflict of interest provision that has prevented FDA and its advisory committees from utilizing some of science’s best minds and left advisory committee slots unfilled. He noted that the committee must also look at implementation of FDAAA’s REMS provision and whether it has caused delays in the approval process.
Conflict of Interest Rules and FDA Advisory Panels
During the hearing, Republicans focused on rolling back new conflict-of-interest rules they say are depriving the FDA of needed expertise from the drug industry. Democrats, focused largely on the safety of imported drugs.
Congress tightened the FDA's conflict-of-interest rules in 2007, as part of the last FDA reauthorization. But Republicans on the House Energy and Commerce Committee said they may try to loosen the standards in the next reauthorization, which needs to pass next year.
Committee Chairman Fred Upton (R-Mich.) said the upcoming bill should reverse "rigid, unrealistic conflict-of-interest provisions" that have delayed drug approvals. The rules govern who can participate in FDA advisory panels, which study safety and effectiveness issues.
"No longer can we afford to sideline experts simply because of their ties to the pharmaceutical industry," Rep. Phil Gingrey (R-Ga.) said during the hearing.
Janet Woodcock, the director of FDA's drug center, said the limits have slowed down the advisory committee process. The agency sometimes goes through the long haul of finding experts in a given field only to discover ties to the pharmaceutical industry toward the end of the process, she said. Below is a summary of her testimony.
There were two panels during the hearing. The first panel consisted of Janet Woodcock, M.D., Director of the Center for Drug Evaluation and Research (CDER) at FDA. We will have a summary of the second panel next week, which included:
Paul J. Hastings, President and CEO, OncoMed Pharmaceuticals, Inc., on behalf of Biotechnology Industry Organization (BIO)
Jonathan Leff , Managing Director, Warburg Pincus LLC
Marc Boutin, Executive Vice President and COO, National Health Council
Ellen Sigal, Ph.D., Chair and Founder, Friends of Cancer Research
Allan Coukell, Director of Medical Programs, Pew Health Group, The Pew Charitable Trusts
Janet Woodcock, MD
Dr. Woodcock first emphasized how PDUFA has produced significant benefits for public health, providing patients faster access to over 1,500 new drugs and biologics since enactment in 1992, including treatments for cancer, infectious diseases, neurological and psychiatric disorders, and cardiovascular diseases.
She noted research from the Tufts Center for the Study of Drug Development, which showed that the time required for the FDA approval phase of new drug development has been cut by 60 percent since the enactment of PDUFA, from an average of 2.0 years for the approval phase at the start of PDUFA to an average of 1.1 years today.
She asserted that the increased resources provided by user fees have enabled FDA to provide a large body of technical guidance to industry that clarified the drug development pathway for many diseases, and to meet with companies during drug development to provide critical advice on specific development programs. In the past five years alone, she noted that FDA has held over 7,000 meetings within a short time after a sponsor’s request. In FY 2009, more than half of the meetings FDA held with companies at the early investigational stage and midway through the clinical trial process were with companies that had no approved product on the U.S. market.
Dr. Woodcock explained that improvements in the efficiency of the drug review process and the quality of new drug applications is evident in the trends toward greater first-cycle approvals for novel drugs, known as “priority” new molecular entities (NMEs). She noted that the average first-cycle approval rate for priority NMEs has increased from 46 percent in PDUFA I to 68 percent to date in PDUFA IV. First-cycle approval rates have also increased for standard NMEs from an average of 30 percent in PDUFA I to 38 percent to date in PDUFA IV.
She recognized that PDUFA provides FDA with a source of stable, consistent funding that has made possible FDA’s efforts to focus on promoting innovative therapies and help bring to market critical products for patients. She also noted how PDUFA funds help support the use of existing mechanisms in place to expedite the approval of certain promising investigational drugs and also to make them available to the very ill as early in the development process as possible, without unduly jeopardizing the patients’ safety.
One such program she noted is accelerated approval, instituted in 1992. She noted that over 60 critical products have been approved under accelerated approval since the program was established.
Consequently, Dr. Woodcock noted however that new authorities granted to FDA under FDAAA put strains on the review process time frames agreed to, as well as on post-market review activities, which compete for the same resources. In addition, the significant increase in the number of foreign sites included in clinical trials to test drug safety and effectiveness has created additional challenges for completion of FDA’s review within the existing PDUFA review performance goals.
Accordingly, Dr. Woodcock briefly summarized FDA’s top priorities identified by public stakeholders, the top concerns identified by industry, and the most important challenges identified within FDA
A Review Program for New Drug Applications (NDA,) New Molecular Entities (NME), and Original Biologics License Applications (BLA)
To address the desire for increased communication and greater efficiency in the review process, an enhancement being considered in FDA’s review program for NME NDAs and original BLAs in PDUFA V would include pre-submission meetings, mid-cycle communications, and late-cycle meetings between FDA and sponsors for these applications.
To accommodate this increased interaction during regulatory review, FDA’s review clock would begin after the 60-day administrative filing review period. The impact of these modifications on the efficiency of drug review for this subset of applications would be assessed during PDUFA V.
Enhancing Regulatory Science and Expediting Drug Development
Dr. Woodcock explained five enhancements to focus on regulatory science and expediting drug development.
1. Promoting Innovation Through Enhanced Communication Between FDA and Sponsors During Drug Development
This enhancement involves a dedicated drug development communication and training staff, focused on improving communication between FDA and sponsors during development. This staff will be responsible for identifying best practices for communication between the Agency and sponsors, training review staff, and disseminating best practices through published guidance.
2. Methods for Meta-analysis
With the growing availability of clinical trial data, an increasing number of meta-analyses are being conducted based on varying sets of data and assumptions. If such studies conducted outside FDA find a potential safety signal, FDA will work to try to confirm—or correct—the information about a potential harm that will create uncertainty for patients and health professionals. To do this, FDA must work quickly to conduct its own meta-analyses to include publicly available data and the raw clinical trial data submitted by drug sponsors that would typically not be available to outside researchers. PDUFA V enhancements being considered include the development of a dedicated staff to evaluate best practices and limitations in meta-analysis methods. Through a rigorous public comment process, FDA would develop guidance on best practices and the Agency’s approach to meta-analysis in regulatory review and decision-making.
3. Biomarkers and Pharmacogenomics
PDUFA V enhancements being considered include augmenting the Agency’s clinical, clinical pharmacology, and statistical capacity to adequately address submissions that propose to utilize biomarkers or pharmacogenomic markers. The Agency would also hold a public meeting to discuss potential strategies to facilitate scientific exchanges on biomarker issues between FDA and drug manufacturers.
4. Use of Patient-reported Outcomes (PRO)
Assessments of study endpoints known as patient-reported outcomes (PROs) are increasingly an important part of successful drug development. PROs measure treatment benefit or risk in medical product clinical trials from the patients’ point of view. PDUFA V enhancements being considered include an initiative to improve FDA’s clinical and statistical capacity to address submissions involving PROs and other endpoint assessment tools, including providing consultation during the early stages of drug development. In addition, FDA will convene a public meeting to discuss standards for PRO qualification, new theories in endpoint measurement, and the implications for multi-national trials.
5. Development of Drugs for Rare Diseases
FDA’s oversight of rare disease drug development is complex and resource intensive. Another PDUFA V enhancement being considered includes FDA facilitation of rare disease drug development by issuing relevant guidance, increasing the Agency’s outreach efforts to the rare disease patient community, and providing specialized training in rare disease drug development for sponsors and FDA staff.
Enhancing Benefit-Risk Assessment
PDUFA V enhancements include expanded implementation of FDA’s benefit-risk framework in the drug review process, including holding public workshops to discuss the
application of frameworks for considering benefits and risks that are most appropriate for the regulatory setting. FDA would also conduct a series of public meetings between its review divisions and the relevant patient advocacy communities to review the medical products available for specific indications or disease states that will be chosen through a public process.
Enhancement and Modernization of the FDA Drug Safety System
The enhancements being considered for PDUFA V include two post-market, safety focused initiatives.
1. Standardizing REMS
FDAAA gave FDA authority to require REMS when FDA finds that a REMS is necessary to ensure that the benefits of a drug outweigh its risks. Some REMS are more restrictive types of risk management programs that include elements to assure safe use (ETASU). PDUFA V enhancements being considered would initiate a public process to explore strategies and initiate projects to standardize REMS with the goal of reducing burden on practitioners, patients, and others in the health care setting. Additionally, FDA would conduct public workshops and develop guidance on methods for assessing the effectiveness of REMS and the impact on patient access and burden on the health care system.
2. Using the Sentinel Initiative to Evaluate Drug Safety Issues
FDA’s Sentinel Initiative is a long-term program designed to build and implement a national electronic system for monitoring the safety of FDA-approved medical products. PDUFA V enhancements would enable FDA to initiate a series of projects to establish the use of active post-market drug safety surveillance in evaluating post-market safety signals in population-based databases. By leveraging public and private health care data sources to quickly evaluate drug safety issues, this work may reduce the Agency’s reliance on required post-marketing studies and clinical trials.
Required Electronic Submissions and Standardization of Electronic Application Data
The predictability of the FDA review process relies heavily on the quality of sponsor submissions. PDUFA V enhancements would include a phased-in requirement for standardized, fully electronic submissions during PDUFA V for all marketing and investigational applications. Through partnership with open standards development organizations, the Agency would also conduct a public process to develop standardized terminology for clinical and nonclinical data submitted in marketing and investigational applications.
User Fee Increase for PDUFA V
Implementing the PDUFA enhancements being considered would add $40.4 million to the estimated PDUFA user fee revenue amount in FY 2012. This translates to a modest 6 percent increase, and a total estimated base of $712.8 million in FY 2013.4
PDUFA V Enhancements for a Modified Inflation Adjuster and Additional Evaluations of the Workload Adjuster
In calculating user fees for each new fiscal year, FDA adjusts the base revenue amount by inflation and workload as specified in the statute. PDUFA V enhancements being considered include a modification to the inflation adjuster to accurately account for changes in its costs related to payroll compensation and benefits as well as changes in non-payroll costs. In addition, FDA would continue evaluating the workload adjuster that was developed during the PDUFA IV negotiations to ensure that it continues to adequately capture changes in FDA’s workload.
Additional Initiatives to Encourage Development of New Therapies
In closing, Dr. Woodcock noted how both FDA and the pharmaceutical industry are facing economic and scientific challenges in drug development. She recognized that only a profitable industry can continue to fund the research and development necessary to find new cures.
As a result, she acknowledged that it is critical for FDA to “work with industry and other stakeholders to take steps to reduce uncertainty and increase the success in the other phases of drug development.” She noted that, to promote the development of innovative new therapies, FDA is working on advancing our scientific base.
She also acknowledged how FDA will transform itself over the next decade from a domestic Agency, operating in a globalized world, to a truly global Agency fully prepared for a regulatory environment in which product safety and quality knows no borders. To achieve this transformation, the Agency is developing an international operating model that relies on improved information sharing and gathering, data-driven risk analytics, and the smart allocation of resources through partnerships.