By Kim Coghill

Washington Editor

BETHESDA, Md. ¿ Nonprofit groups and government leaders were split Friday during a discussion about the future source of funds to support the FDA¿s possible Prescription Drug User Fee Act III (PDUFA).

The way the law reads now, PDUFA is financially supported by the organizations that use it. That is, pharmaceutical and biotechnology companies pay the FDA user fees when they submit new drug applications and biologics license applications.

And now that PDUFA II, reauthorized in 1997, nears its September 2002 expiration date, the FDA is soliciting opinions and suggestions on how to improve the law that is responsible for generating millions of dollars for the agency since its initial approval in 1992.

The extra funding has helped the FDA hire additional personnel (about 2,500 reviewers today compared to 1,277 in 1992), designed to reduce the time it takes to move a drug application through the agency. The median total approval time for new drug and biological applications submitted in fiscal 1999 dropped to 11.6 months, from 20.1 months in fiscal 1994, the agency said.

At issue now, the FDA claims it underbid PDUFA II and without additional funding, the program would falter. In fact, the financial situation is so serious that Linda Suydam, senior associate commissioner for communications and constituent relations at the FDA, told attendees at the public hearing Friday that if President George Bush doesn¿t sign PDUFA III by midnight Oct. 1, 2002, the program will fall apart because the FDA has no spare money to keep it going.

So, what to do?

There are a couple of issues at hand. The first is money and where it should come from. Some people say Capitol Hill, others say the bank accounts of businesses through user fees.

The problem with the latter is that nagging point concerning regulators being funded by the industry they regulate, but no one actually stood up and said to stop taking money from the companies. A few speakers danced around it, however.

Travis Plunkett, legislative director on reauthorization of PDUFA for the Washington-based Consumer Federation of America, said the best way to ensure timely approval of safe drugs is to adequately fund the FDA from general revenues. ¿Congress should provide the additional appropriations for the FDA,¿ he said.

Susan Winckler, group director of policy and advocacy for the Washington-based American Pharmaceutical Association, said, ¿It is evident that the amount of revenue generated by PDUFA fees is not adequate for the agency to maintain shortened review times and meet increasingly stringent performance goals. Funding from fees and appropriations must be increased to keep pace with expected expansion.¿

The FDA¿s annual budget is about $1.4 billion. Fees for new drug applications and biologics license applications include a base cost of $267,606 plus an inflation adjustment (cumulative since 1997 at 15.71 percent) to total $309,647 in fiscal year 2001. In 2001, the agency collected about $140 million in user fees, but spent upwards of $163 million on the program.

While Plunkett looked toward the government for more money, Winckler tended to lean toward additional user fees, a concept the FDA is considering.

Winckler recommended extending PDUFA to direct-to-consumer advertising and post-marketing surveillance.

But adding more user fees could create the appearance of a conflict of interest, said Diana Zuckerman, president of the Washington-based National Center for Policy Research for Women and Families. ¿Other areas, for example medical devices, don¿t have user fees. Having worked for Congress for several years, I think Congress could be persuaded to be more generous in their FDA funding,¿ she said. ¿I don¿t think members of Congress and their staff understand the FDA and what you do.¿

Aside from future funding, another more basic issue surrounding PDUFA has been heating up for some time. Some drug industry insiders say PDUFA has done nothing but create a sweatshop within the agency and it¿s not necessary to the drug approval process; instead, it probably creates more problems than it solves.

Plunkett charged that PDUFA has not provided a net benefit to public health because it has been successful at the cost of other departments within FDA.

He made the point that drug approvals may be too swift, and that can lead to disastrous results. For example, he pointed to the recent withdrawal of the anti-cholesterol drug Baycol (Bayer Pharmaceuticals).

Yes, drugs have been withdrawn, but as pointed out by Kathy Zoon, director of FDA¿s Center for Biologics Evaluation and Research, drugs approved under PDUFA have saved lives and improved the quality of many lives.

She said 712 drugs have been approved under PDUFA since 1992, and 198 of them were significant therapeutic advances that were approved under priority review.

For example, she said, Herceptin, a breast cancer drug made by Genentech Inc., of South San Francisco, was approved in five months and in the time saved, added 2,300 hours of life to women with breast cancer. (See BioWorld Today, Sept. 29, 1998.)

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