Reauthorization of User Fee Agreement

In May, a Senate committee advanced the FDA Reauthorization Act of 2017, a bill to replace the current user agreement scheduled to expire at the end of September. The bill would increase the fees paid to the FDA over the next five years in exchange for more timely reviews of some medical products, more industry interactions with the FDA, and more guidance from the FDA on particular areas.

Two additional amendments were added to the bill in the Senate:

  1. The Hatch Amendment aims to broaden eligibility criteria for clinical trials so that enrollment more accurately reflects the patients most likely to receive the treatment, and strikes a section of the Food, Drug, and Cosmetic Act.
  2. The Franken & Collins Amendment aims to foster a more competitive generic drug market.

However, there is growing concern over the bill’s future. President Trump’s FY 2018 budget proposal for the FDA seeks a last minute negotiation of the user fee deals to make up for an approximately 30% decrease in the FDA’s budget. Currently, user fee agreements cover an average of 60% of FDA premarket review cost, but Trump’s plan would have the entire cost fall on the industry. Though Congress has made it clear that additional fees will not be adopted, there is the possibility that Trump may veto the bill if it strays too far from his plan. This would be a damaging blow to the FDA and manufacturers alike as it would result in a 31% cut in the FDA’s budget authority appropriation.