H.R. 2430, The FDA Reauthorization Act

Noteworthy

Background: H.R. 2430, the FDA Reauthorization Act of 2017, was passed by voice vote in the House on July 12. A similar bill reauthorizing the FDA user fee agreements was passed by the Senate HELP Committee by a vote of 21 to 2 on May 11. 

Floor Situation: Leader McConnell filed cloture on the motion to proceed to H.R. 2430 on August 1.

Executive Summary: H.R. 2430 would reauthorize four Food and Drug Administration user fee programs until October 1, 2022: the Prescription Drug User Fee Act; the Medical Device User Fee Amendments; the Generic Drug User Fee Amendments; and the Biosimilar User Fee Act. Under these programs, companies pay for part of FDA’s regulation of their products.

Overview of the Issue

The current user fee agreements expire on September 30. If Congress does not authorize new user fee agreements, the FDA would have to lay off staff, which would disrupt FDA’s pre-market review programs.

H.R. 2430 reauthorizes FDA user fee programs for prescription drugs, medical devices, generic drugs, and biosimilars for five years, expiring on October 1, 2022.

H.R. 2430 further contains FDA reforms and policies aimed at speeding up the review process for drugs that lack significant competition.

The 21st Century Cures Act included policies that modified drug and device regulation, and reauthorizing the user fees is integral to carrying out the reforms in 21st Century Cures. 

Notable Bill Provisions

Title I – Fees Relating to Drugs

This title reauthorizes the Prescription Drug User Fee Act. It reauthorizes the authority of the secretary of Health and Human Services to collect fees from the pharmaceutical industry to support the FDA’s human prescription drug application review process.

This title eliminates supplemental application and facility fees. The new fee structure is based on 20 percent application fees and 80 percent program fees for approved products.

The PDUFA base fee revenue in fiscal year 2018 is set at almost $879 million, an increase of $160 million from fiscal year 2017. The authority to collect fees would sunset on October 1, 2022.

Title II – Fees Relating to Devices

This title reauthorizes the Medical Device User Fee Act. The new MDUFA agreement allows the secretary of HHS to collect about $1 billion in fees from the medical device industry over a five year period (fiscal years 2018 – 2022). The base fee amount is increased from $130 million in fiscal year 2017 to more than $183 million in fiscal year 2018.

Title III – Fees Relating to Generic Drugs

This title reauthorizes the Generic Drug User Fee Act. It reauthorizes the secretary’s authority to collect fees to review and regulate generic pharmaceuticals. The base fee amount is updated from $299 million in fiscal year 2017 to $493.6 million in fiscal year 2018.

The reauthorization removes the fees for prior approval supplements and establishes a generic drug applicant program fee. It establishes that 33 percent of the total revenue will come from application fees, 20 percent will come from generic drug facility fees, 7 percent will come from active pharmaceutical ingredient facility fees, and 35 percent will come from a new generic drug applicant program fee.

The generic drug applicant program fee is determined by how many applications the applicant has approved by the FDA:

  1. a manufacturer with 20 or more approved applications pays the full fee;

  2. a manufacturer with at least six but not more than 19 approved applications pays 40 percent of the full fee; and

  3. a manufacturer with five or fewer approved applications pays 10 percent of the full fee.

Title IV – Fees Relating to Biosimilar Biological Products

This title authorizes a new Biosimilars User Fee Act. The base fee amount is increased from $20 million to $45 million.

An independent fee for biosimilars is established based on the following:

  1. Initial biosimilar development fee for the first year once a sponsor begins clinical trials for a new biosimilar;

  2. Annual biosimilar development fee for subsequent years a sponsor is developing a new biosimilar;

  3. Biosimilar program fee for sponsors of approved biosimilars; and

  4. Application fee for new biosimilar applications.

Allows the secretary of HHS to determine the appropriate percentage that will come from each of the fees and each fee amount annually.

In addition, the reauthorization eliminates supplement and establishment fees.

Title V – Pediatric Drugs and Devices

Significant elements of the Research to Accelerate Cures and Equity for Children Act, which has been introduced in both Houses of Congress, are included in this title. It gives the FDA the authority to require adult cancer drugs that share a common molecular target with a pediatric cancer to be studied in children to get information about dosing, safety, and efficacy.

The FDA is required to publish and maintain a list of molecular targets and cancers for which the requirement would be waived.

Title VI – Reauthorizations and Improvements Related to Drugs

This title includes an expansion of the definition of patient experience data to include both physical and psychosocial impacts of a disease or participation in clinical trials for a therapy to treat such disease.

In order for a drug manufacturer to obtain orphan drug exclusivity for an orphan drug that has the same active ingredient as a drug already on the market it must demonstrate clinical superiority.

It includes a sense of Congress that the secretary of HHS should work with Congress on legislation that will lower the cost of prescription drugs in a way that balances the need to encourage innovation and increase competition.

Title VII – Device Inspection and Regulatory Improvements

This title contains reforms that are designed to streamline and improve the inspection processes for devices.

Title VIII – Improving Generic Drug Access

This title creates a priority review process for generic drugs. It requires the secretary to prioritize the review of, and act within eight months of the date of the submission of, an original abbreviated new drug application submitted for review for a drug that does not have more than three approved products and for which there is no blocking patents or exclusivities.

It also requires the FDA to maintain a list of drugs with limited competition.

It creates a 180 day exclusivity period to encourage companies to enter the market if only one generic drugs exists and has no existing patents or exclusivities. 

Title IX – Additional Provisions

This title includes various provisions intended to increase FDA transparency and accountability in meeting the goals of the user fee agreements.

Administration Position

The administration issued a Statement of Administration Policy in support of H.R. 2430 on July 12. 

Cost

The Congressional Budget Office estimates that H.R. 2430 would decrease the deficit by $72 million from 2018-2027.