Renewing FDA fee program will boost innovation

Is America still a place where big ideas can move policymakers to slash red tape in drug development to save lives, drive innovation and spur economic growth?

It certainly appears so. The Obama administration, industry, the Food and Drug Administration and patients’ groups have all come together in recent months to highlight the need for regulatory reforms to help patients gain faster access to safer and more innovative medicines.

Streamlining innovation begins with improving the FDA’s framework for evaluating the potential risks and benefits of new medicines — and making it as transparent, predictable and science-based as possible.

For starters, policymakers should reauthorize the Prescription Drug User Fee Act, bipartisan legislation first passed in 1992.

Renewed by Congress every five years, PDUFA gives the FDA authority to collect user fees from companies when they submit new drug applications. The agency uses those fees to hire and train the staff it needs to review applications in a timely and predictable manner. (Note, however, that those fees have no influence on whether or not the FDA approves a product.)

PDUFA also sets timelines for the review of new products that can help evaluate the FDA’s performance.

America’s ecosystem for biomedical innovation is in dire need of an overhaul. Today, it can take more than a decade and $1.3 billion to bring a single new FDA-approved medicine to patients.

Industry and the National Institutes of Health also spend nearly $100 billion annually on basic and applied medical research, but only about 20 new drugs manage to reach the market each year.

Venture capital for biotech is also being cut back, with investors citing an unpredictable and expensive regulatory process.  American patients are also waiting longer for access to some new medicines and medical devices that have already been approved in Europe.

The FDA isn’t the only stakeholder responsible for innovation, but it is effectively the “rate-setting” institution, since no medicine or technology can make it to market without first gaining FDA approval.

The recent technical agreement for PDUFA, developed by the FDA and industry in consultation with patient and consumer groups, includes a number of important new tools for advancing lifesaving innovations.

First, the agreement offers the FDA $100 million in expanded user fees to increase staffing, improve agency training programs and strengthen the agency’s science base.

The FDA will also get an additional two months to review new drug applications in return for improving communications with companies and training reviewers on “best practices” for reviewing applications.

This will help create more predictability for companies who have to devote huge sums to complying with agency regulations. Given limited patent protections, a delay of a few months or a year can cost companies hundreds of millions of dollars, and literally mean the difference between life and death for patients who have to wait for new therapies.  

Second, PDUFA contains provisions for improving how the FDA reviews groups of studies (called meta-analysis) to detect rare safety signals, and tries to set clearer standards for the use of biomarkers in drug development (critical tools used to identify patients more likely to benefit from new medicines).

Perhaps most important, it commits the FDA to developing a new framework for incorporating patients’ views on the benefits and risks of new therapies into every stage of the drug development and review process.

This is a critical step in ensuring that patients’ voices are heard when the agency is deciding how to evaluate new medicines.  

These and other tools will help move the FDA — and industry — closer to a model of patient-centered drug development that takes advantage of the latest scientific discoveries to advance new therapies for life-threatening diseases such as cancer and Alzheimer’s, as well as chronic diseases such as depression, diabetes, and obesity that afflict tens of millions of Americans. It’s a critical beginning.
Paul Howard is the director of the Center for Medical Progress at the Manhattan Institute and managing editor of

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