FDA user fee legislation speeds drug approvals, addresses shortages, counterfeits


The passage of the FDA Safety and Innovation Act will support innovation, answer the current shortages, and even regulate mobile applications.

It was a pleasant surprise when leading legislators reached across party lines in June to quickly approve the FDA Safety and Innovation Act (FDASIA). The bill (S. 3187), which President Obama signed into law last month, enables FDA to collect some $6 billion in fees over the next 5 years from pharmaceutical and medical device companies. It's much "cleaner" than the 2007 user fee measure, which set so many requirements on FDA that it slowed drug approvals for a year. Yet, implementing multiple new policies and programs and preparing the host of required guidance and reports still will be a challenge for the agency and regulated firms.

At almost the same time, the US Supreme Court issued a ruling that upheld the constitutionality of the Affordable Care Act (ACA). For FDA, that ended speculation that the agency might lose authority to establish a pathway for developing new biosimilars. And it confirmed that pharmaceutical companies will continue to pay higher Medicaid drug rebates and hefty excise taxes to the Treasury, while also providing discounts on drugs prescribed to Medicare patients in the "coverage gap."


This fifth version of the Prescription Drug User Fee Act (PDUFA V) aims to spur medical product innovation by offering assistance in clinical research design for sponsors and greater transparency in the application review process. An important theme is that FDA and pharma companies should consider patient willingness to accept risk in product development and regulation.

Patient advocates played a prominent role in pressing for faster FDA approval of certain new treatments, including specific provisions that expedite review of fast-track products and clarification of evidence and end points to support accelerated approval of drugs for serious or life-threatening conditions.

Grants for developing orphan products will continue under FDASIA, and revised conflict-of-interest rules will make it easier to bring in "knowledgeable experts" to serve on advisory committees, especially those dealing with rare diseases.

Infectious disease experts won incentives for developing new antibiotics: an added 5 years exclusivity will apply to specific "qualified infectious disease products," which FDA has to define and list.

Other provisions stabilize programs that encourage development of new formulations and expanded labels for pediatric treatments, and a new pilot will test whether an offer of priority review vouchers, which can be redeemed for a speedy FDA review of another product, will accelerate development of new therapies for rare childhood diseases.

A less-noticed but important provision requires electronic submission of applications for drugs and biologics, once FDA establishes policies and standards for doing so. Here, FDA and the legislators take the unusual step of making agency guidance mandatory, a strategy that seeks to move this policy forward without a lengthy rulemaking process. And the final bill aims to reduce duplicative clinical studies by encouraging FDA to accept foreign clinical trial data that supports new drug applications.

FDASIA also allows manufacturers to make minor modifications in Risk Evaluation and Mitigation Strategy (REMS) programs. Generic drug makers lost out in their campaign to prevent brand companies from using REMS to block access to products needed to test and develop new generic competitors, an issue that could affect biosimilar development down the road.

However, other changes in policies governing generic drug exclusivity and procedures for handling citizens' petitions promise to accelerate consumer access to generics.

Some Senators sought to add provisions to the bill that would restrict the prescribing and sale of opioid painkillers to rein in rampant abuse of these products. That proposal, however, ran into strong objections from pharmacists. As a compromise, the legislation instructs FDA to hold a public meeting on the need to reschedule hydrocodone and calls for scrutiny of ways to exchange prescribing information across state lines to help pharmacists detect multiple painkiller prescriptions.

Further discussion of opioid use is likely to examine FDA's long-awaited REMS for extended-release opioids, which was released last month-but without a proposed requirement for prescribers to meet certain educational requirements.


The final law also contains a wealth of provisions designed to help FDA detect and block counterfeit and adulterated medical products. All drug manufacturers and foreign suppliers have to register with FDA using a unique facility identifier. Importers must meet numerous requirements and file registration information electronically. FDA may block imports from manufacturers that deny access to inspectors and may detain-and even destroy-adulterated products at the border, instead of having to send them back to the shipper. Manufacturers have to notify FDA if a drug may be stolen or counterfeited, and intentional adulteration for economic gain carries stiff penalties, including jail time.

To curb critical drug shortages, the law extends reporting requirements for manufacturers anticipating short supply situations and gives FDA clear leeway to expedite inspections and application reviews to help mitigate or prevent a shortage. The Drug Enforcement Administration has to provide timely approvals or denials of requests to increase quotas of controlled substances when needed to address a drug shortage.

There will be an FDA annual report on its success in stopping shortages, along with a drug shortage list that will help patients and providers stay informed about supply problems. And a new Department of Health and Human Services task force will examine ways to enhance the federal response to shortages and create a strategic plan to address these problems.

And several provisions aim to improve FDA regulatory practices involving drug production and oversight. FDA now can schedule plant inspections based on risk factors, instead of following a long unworkable 2-year pharma inspection requirement.

The agency may share trade secret information with trusted regulatory counterparts, and US law governing drugs and medical products may be applied to extraterritorial violations, such as economically motivated adulteration of products like heparin.


A less-noticed provision in the FDASIA addresses how FDA may-or may not-regulate medical applications for smart phones and other computer devices, a hot issue for software developers, manufacturers, and health authorities. The legislation instructs FDA to form a working group that will quickly (in 18 months) develop a strategy for an "appropriate, risk-based regulatory framework" on health IT "that promotes innovation, protects patient safety, and avoids regulatory duplication."

FDA will consult with the National Coordinator for Health Information Technology and the Federal Communications Commission and include manufacturers, payers, venture capitalists, IT vendors, patients, providers, and others in the working group.

The starting point will be FDA draft guidance issued last year that proposed agency regulation of software that links to a device such as an MRI or infusion pump-but not low-risk apps such as calorie counters.

Software and medical device companies are concerned that FDA will over-regulate this budding industry, squashing innovation and promising health technology in the process. Approximately 40,000 medical apps have been developed, some by pharma companies looking to enhance patient use of treatments for diabetes and other medical conditions and to help manage clinical trials. A manufacturer recently sought and gained FDA approval for an app that displays radiological images, and some IT firms support FDA regulation to gain more predictability in market requirements.


Despite its many provisions, FDASIA does not please everyone. Some consumer advocates warn that more accelerated approvals may expose patients to unsafe therapies. Infectious disease experts wanted provisions to ensure appropriate use of antibiotics. And debate continues over what was left out of the bill-namely requirements for a national track-and-trace system for prescription drugs. Here, policy-makers were stalemated by industry's insistence that tracking apply only to production lots-and not individual vials and bottles, as FDA demanded. Manufacturers, distributors, and pharmacists consequently still face multiple state tracking requirements, starting with a California law that goes into effect in 2015.

As the analysts and lawyers continue to pore over the fine print in FDASIA, additional impacts and unnoticed requirements will emerge. FDA will consider all these perspectives in developing a communications plan on risks and benefits of medical products and in assessing the gains provided by the new PDUFA V review program for new drugs and biologics.

Ms Wechsler is a Washington-based reporter specializing in federal and state healthcare issues.

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