An Overview of the User Fee Systems concerning the U.S. Pharmaceutical Product Review

The U.S. government promulgated the Food and Drug Administration Reauthorization Act of 2017 (FDARA) in August 2017 after two years of negotiation, which authorizes FDA to continue to use the user fees of medical devices, pharmaceutical products, and other health products as its main source of fund and will continue in effect until 2022.

Sources of the budget for the U.S. pharmaceutical product review mainly include congressional appropriations and fees. The current user fee acts concerning pharmaceutical product review mainly include Prescription Drug User Fee Act (PDUFA), Medical Device User Fee Amendments (MDUFA), Generic Drug User Fee Amendments (GDUFA), and Biosimilar User Fee Act (BsUFA). For decades, user fees paid by the pharmaceutical products industry have provided necessary resources needed to conduct product reviews in a timely fashion and to help ensure the safety and effectiveness of pharmaceutical products that American patients depend upon; meanwhile, the user fee laws and corresponding performance goals and program enhancements have helped evolve the drug and device review process in the U.S., allowing patients access to new and innovative treatments as quickly as possible without compromising the FDA’s high standards.

Next, let’s learn about those user fee systems one by one:

PDUFA

The new drug application quantity increased year by year from 1970s, and the technical requirements for new drug application became increasingly higher, leading to the increase of data required to be submitted by pharmaceutical manufacturers, which increased the workload of the new drug review department of FDA and also prolonged the new drug review and approval time, resulting in the "drug lag". To effectively address this problem, after discussions and studies, the U.S. Congress promulgated the Prescription Drug User Fee Act (PDUFA) in 1992 that authorizes FDA to collect review fees from pharmaceutical manufacturers/applicants, to increase FDA’s source of fund for pharmaceutical product review, enable FDA to hire more reviewers and supporters, and update FDA’s IT system, and must be renewed and reauthorized every 5 years. Thereafter, the Congress reauthorized the PDUFA Ⅱ, Ⅲ, Ⅳ, Ⅴ, and Ⅵ, to continue the authorization till today. PDUFA has provided an important source of expenditure for FDA’s pharmaceutical product review, and achieved the balance between guarantee of safety, effectiveness, and quality of pharmaceutical products, and encouragement of innovation by accelerating pharmaceutical product review, over the more than 20 years since implementation.

List of Promulgation of PDUFA

Generally, PDUFA fees are divided into three types: Application and Supplement Fee, Establishment Fee, and Product Fee, however, the PDUFA Ⅵ approved this year specifically includes Application Fee and Program Fee, with Product Fee adjusted, and the Supplement Fee and Establishment Fee canceled; under the new fee structure, 20% of the total fees are Application Fee, and 80% thereof are Program Fee.

MDUFA

The MDUFA was created in 2002, and specifies that manufacturers shall pay certain fees to FDA when conducting registration and product registration, and filing applications or marketing notifications. FDA undertakes to increase the efficiency of regulatory processes with a goal of reducing the time it takes to bring safe and effective medical devices to the U.S. market, with the support of fees paid by manufacturers.

GDUFA

GDUFA went into effect in October 2012. Based on PDUFA, it is designed to speed the delivery of safe and effective generic drugs to the public and reduce costs of the industry. GDUFA requires generic drug manufacturers to pay user fees that will be used to supplement the funds for generic drug application review and facility inspection. GDUFA specifies that facilities manufacturing, or intending to manufacture, API of human generic drugs and/or finished dosage form (FDF) human generic drugs shall conduct facility self-identification. After such self-identification, which facilities shall pay user fees can be determined. Any failure to timely pay the facility self-identification fees will lead to disapproval of generic drug applications referencing the facility. In addition, facilities that fail to pay on time will be uniformly published in the list of arrears; FDA will also notify the relevant ANDA applicants; furthermore, all API or FDF products manufactured at the facility will be deemed misbranded by FDA, which means that exportation of such products to the U.S. will be deemed as an illegal act by the U.S. customs, thus leading to denial of entry of the products.

The fees required to be paid by generic drug enterprises under GDUFA roughly include: Abbreviated New Drug Application (ANDA) fee, Prior Approval Supplement (PAS) fee, Drug Master File (DMF) fee, and backlog fee.

BsUFA

BsUFA was created in 2012, to provide some funds for setting up the biosimilar review path. Biosimilars belong to biological product, and are products highly similar to the approved and marketed biological products, however, biosimilars may be different from the reference products in certain aspects. Marketing of biosimilars has been slow in the U.S., which is closely connected with the characteristics of biosimilars, however, FDA’s support of biosimilars will be further improved in the future, with the reauthorization of the biosimilar user fee program.

The budgeting of any pharmaceutical product R&D project is required to comprehensively evaluate the fees of each aspect in each stage of the project. Especially for international R&D projects, the knowledge of the latest international registration fees is required to be known and acquired on the internationalization road. It is hoped that this article may be helpful to Chinese enterprises.

By Zhulikou431