User Fee Draft Suggests Congressional Wariness Of Trump Budget
Executive Summary
Discussion draft includes US FDA negotiated user fee amounts well short of the total in recent Trump budget outline.
Lawmakers made clear in their first draft of the US FDA user fee legislation that fiscal year 2018 cuts to the agency's budget authority may not be as drastic as envisioned by President Trump.
The prescription drug (PDUFA), generic drug, biosimilar and medical device user fee amounts included in the bill would be well short of the revenue target Trump wants in FY 2018, meaning more non-fee dollars may be necessary to meet the agency's needs. That is, Congress might have to appropriate more if it asks less from industry user fees than Trump suggests.
The discussion draft released April 14 by House and Senate health leaders includes base revenue amounts that would be in place when the new user fee programs launch on Oct. 1, the start of FY 2018. Combined they would total $1.68bn, more than $324m short of Trump's budget blueprint, which called for more than $2bn in user fee revenue for drugs, generics, devices and biosimilars in FY 2018 (see chart below).
The draft bill does not make policy changes beyond reauthorizing the basic program governed by user fee agreements. But with a number of pressing issues related to FDA that are pending, additions to the must-pass legislation seem imminent. (Also see "First Draft FDA User Fee Bill Is Squeaky Clean" - Pink Sheet, 14 Apr, 2017.)
PDUFA VI would start FY 2018 with $878.6m in base revenue, according to the bill. The bill follows closely the FDA/industry user fee agreement, but the latter had not disclosed this specific figure. It is about 16% more than the $754.5m that FDA intends to collect in the final year of PDUFA V. (Also see "PDUFA Fees Forced Down For FY 2017 Due To Refund Provision" - Pink Sheet, 27 Jul, 2016.)
The bill notes specific areas of funding increases for FDA, including a $66.5m five-year allotment. The legislative proposal does not stipulate how that money should be spent, but the FDA/industry agreement called for the amount to be used to hire 230 additional full-time equivalent employees. (Also see "PDUFA First: Fees To Support Device Center Staff" - Pink Sheet, 24 Aug, 2016.)
Another $8.73m in additional funding will be added each year of the program cycle for an "additional direct cost adjustment," according to the bill. That funding, which will be adjusted for inflation each year, is expected to pay for non-new hire items, such as workshops, evaluations and pilot studies.
Source: Draft user fee legislation, Federal Register notices, appropriations legislation and Trump budget blueprint