By Lisa Seachrist
WASHINGTON * Promising a balanced budget * even a slight surplus by 2002 * the Clinton Administration unveiled its fiscal year 1998 budget proposal which it will present to Congress next week. While promising to "spread the pain," the administration hit the FDA with an 8 percent baseline cut that has left industry representatives livid.
"I am extremely disappointed in what essentially undermines the effectiveness of the user fees act," said Carl Feldbaum, president of the Biotechnology Industry Organization (BIO). "There is a lot of stuff in this budget that is questionable, like the procurement of trident submarines to fire against the former Soviet Union. Hampering FDA is not in the interest of public health."
The administration's budget allots the FDA $1.064 billion for fiscal year 1998, an increase of $68 million over fiscal year 1997. However, that figure is based upon reauthorizing the Prescription Drug User Fee Act (PDUFA) and collecting $136 million more in user fees. In essence, the budget cuts $68 million from the FDA's budget authority.
The extra money generated from user fees will be used to offset the cut and finance other areas of FDA regulation, such as medical devices, animal drug approvals, import inspections, generic and over-the-counter drug applications, and establishment fees.
Funding other FDA activities with user fees is in direct opposition to the thrust of BIO's negotiations with the FDA over reauthorizing PDUFA, which is set to expire in September.
"This is just bad public policy," Feldbaum said. "There is a wave of new products coming out of the biotech industry and now is not the time to slow the agency's ability to approve deserving products."
BIO will take its concerns about the cut to Congress. Feldbaum said, "For the purpose of negotiation, this budget went way beyond what it should have and I don't want to see the efficiencies wrung out of PDUFA."
The National Institutes of Health (NIH), on the other hand, received an inflation increase of 2.6 percent, from $12.75 billion in fiscal year 1997 to $13.1 billion in fiscal year 1998.
"This increase will go primarily to investigator-initiated, peer-reviewed research grants," said John Gibbons, the assistant to the President for science and technology. "This increase will fund high priority research areas such as HIV/AIDS-related illnesses, breast cancer and other women's health issues, minority health initiatives, disease prevention research and spinal cord injury research."
NIH Director Harold Varmus noted that the increase should allow NIH to fund 7,000 new grants. In addition, the Office of AIDS Research will redirect funds to represent a strong vaccine effort as well as fundamental science.
Department of Health and Human Services Secretary Donna Shalala said that "NIH proposes to invest $1.5 billion in HIV/AIDS research * including a substantial increase in funding for AIDS vaccine research, so we can use the light of science to finally reach the end of this dark tunnel."
Feldbaum called the NIH increase "a move in the right direction toward promoting the administration's number one priority: strengthening health care." But, he said that the cut to the FDA is far more damaging.
Congress will begin hearings on the budget next week. *