United States: U.S. FDA Proposes User Fees For Applications For New Generic Drug Applications

Originally published in Innsight

The Food and Drug Administration, which is the federal agency responsible for reviewing and approving applications to sell prescription pharmaceuticals in the United States, is currently working to develop a system in which manufacturers of generic drugs will pay fees to the FDA when seeking approval to sell generic versions of prescription drugs. Charging generic manufacturers "user fees" will assist in providing the FDA the resources it needs to inspect generic drug manufacturing facilities in a timely manner, promptly conduct scientific evaluations of applications to sell generic drugs, and to establish periodic surveillance inspections of generic drug manufacturing facilities, In short, the FDA believes that user fees would go far in speeding up the approval process for Abbreviated New Drug Applications (CANDAs) to make new generic medicines available to the public more quickly than current procedures allow.

Generic drugs account for more than 70% of pharmaceutical prescriptions written in the United States, and larger percentages of prescriptions overseas and throughout the world. The FDA's Office of Generic Drugs has for many years lacked adequate government funding and staffing to process ANDAs and to conduct required inspections of generic manufacturing facilities both in the U.S. and around the world supplying the American market. User fees paid by ANDA sponsors would reduce the backlog of unapproved ANDAs and shorten the time from submission to market approval by furnishing the agency with resources to hire much needed additional staffing necessary for the review and approval process. Several blockbuster drugs are scheduled to lose patent protection in the next few years, providing an unprecedented opportunity for generics to compete in the marketplace and get their equivalent medicines to the public soon after these patents expire.

FDA Commissioner Supports User Fees for Generic Drug Applicants FDA Commissioner Margaret A. Hamburg, M.D., discussed the reasons that the FDA believes that generic drug companies should pay user fees during her keynote address at the GenericPharmaceutical Association CGPhA) annual meeting last week in Orlando, Florida, Before a large audience of international generic drug company representatives, Dr. Hamburg explained that the FDA already charges innovator drug manufacturers user fees when they file New Drug Applications (CNDAs), and that the FDA charges user fees for virtually all other medical products for which it conducts pre-marketing reviews, Although Dr, Hamburg acknowledged that generic manufacturers have never been requested to pay user fees as part of the ANDA process, the changing dynamics of the American pharmaceutical market, she said, necessitates the creation of a funding source that will provide the resources necessary for the FDA to review generic drug manufacturing facilities worldwide, conduct a thorough scientific evaluation of each ANDA application, and to establish periodic surveillance inspections of facilities producing drugs intended for distribution in the U.S. Having a steady and reliable funding source, the Commissioner noted, will give the FDA's Office of Generic Drugs the resources necessary to significantly reduce the time it takes for generic drugs to obtain FDA approval for sale in the American market.

FDA Involves Generic Industry in the Development of User Fee System

At the GPhA meeting in Orlando, executives from major generic manufacturers met with Commissioner Hamburg and expressed a desire to continue working with the FDA to develop a system in which generic manufacturers are charged fair user fees. According to the FDA, eight ANDA applications to sell generic drugs are filed for each NDA filed by an innovator manufacturer seeking to introduce a new drug to the American market. The significant increase in ANDA applications has created an ANDA backlog, preventing the agency from furnishing the prompt reviews anticipated by generic drug sponsors and frustrating the FDA's own policy priority of getting qualifying generic drugs to the public as timely as possible.

There was a public hearing on generic drug user fees in September 2010, and the FDA has indicated that it will continue the conversation regarding user fees with generic industry representatives later this month and throughout the year. Generic manufacturers have welcomed this opportunity, and will be continuing to work with the FDA in a common effort to reach agreement on these issues.

Conclusion

Industry executives believe that it may take the FDA between 12 and 24 months to implement a user fee system for generic drugs. In exchange, the FDA has promised a quicker review and approval process. This may result in a win-win for both the agency and industry if the effect of user fees speeds up ANDA approvals and the marketing of generic drugs.

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