FDA officials and representatives of the pharmaceutical industry are in negotiations over the user fees that companies pay the agency to help fund the drug review process, the Wall Street Journal reports. According to the Journal, "Exact details of the deal they strike likely will take shape in the next few weeks." Under the 1992 Prescription Drug User Fee Act, pharmaceutical companies agreed to pay fees to FDA, and in return the agency agreed to aim to review drugs in 12 months or less. The companies pay fees when they file drug applications, and they also pay fees based on the number of manufacturing facilities they operate and the number of products they sell in the U.S. In fiscal year 1993, the industry paid a total of $8.9 million in user fees, accounting for 7% of the agency budget. The new PDUFA agreement, which must be approved by Congress, would begin Oct. 1, 2007. Each of the two times PDUFA has been renewed, "FDA has gained new funding," and the "industry has wrung concessions," the Journal reports.

Negotiations
According to the Journal, FDA in the current negotiations initially suggested a series of proposals that would increase user fees by more than $100 million annually. The increase would bring the total contribution from user fees to 66% of the drug review budget, compared with a total of $232 million in user fees accounting for 53% of the drug review budget in fiscal year 2004. FDA officials say greater industry contributions are needed in the upcoming renewal because federal budget appropriations to the agency have been outpaced by increasing personnel costs and the costs of implementing new regulations. According to the Journal, it is not likely that FDA will "get all it seeks." However, "people with knowledge of the matter say the agency is likely to win some concession, including new funding for drug safety, partly because of pressure on drug companies from Congress," the Journal reports. Increased funding for monitoring postmarket drug safety is a "central issue in the talks," and the industry is likely to agree to the increase, according to individuals close to the negotiations. Meanwhile, "The companies' most significant goal was to get the FDA to give them a set amount of time ... to review and discuss the agency's proposals on new drug labels and other conditions on approval," but the agency "has resisted offering such a guarantee," according to the Journal. Advertising regulations also are under discussion, with the industry lobbying for a specified time frame for FDA to review drug ads, the Journal reports.

Some Concerns
According to the Journal, some former FDA officials have expressed concern that the "negotiations raise troubling questions." Former FDA Commissioner David Kessler, now dean of the medical school at the University of California-San Francisco, said, "There is no doubt that user fees give the industry leverage on setting the agency's priorities. There are significant risks, especially when a growing percentage of the budget comes from user fees." FDA Deputy Commissioner Janet Woodcock said, "During the negotiations, FDA and industry discuss various enhancements and their value to industry, and we would never agree to anything that compromises our integrity or standards" (Wilde Mathews, Wall Street Journal, 9/1).