The House’s reauthorization legislation calls for nearly $400 million in new fees in FY2018, with progressive increases through 2022. The bill restructures fees for pharmaceuticals, introduces an independent fee structure for biosimilars and includes several provisions for medical devices. The Senate has yet to schedule a vote on its version of the legislation.
The House of Representatives advanced legislation to reauthorize user fee programs for prescription drugs, generics, medical devices and biosimilars through 2022, and published a report breaking down each section of the bill. The FDA Reauthorization Act of 2017 calls for sequential increases in the amount of user fees through 2022, adding nearly $400 million in new fees in FY2018.
The bill sets the annual base revenue for pharmaceuticals at $878 million, an increase over FY2017’s $718.7 million. It calls for fees for pharmaceuticals to generate an additional $20.1 million in FY2018, $21.3 million in FY2019, $16.9 million in FY2020, $5.4 million in FY2021 and $2.7 million in FY2022. Of the total revenue, 20% is to be derived from application fees and 80% from prescription drug program fees. The legislation reauthorizes the orphan drug and pediatric drug programs. It also calls on HHS to commit to working with the House and Senate to address drug costs and the need to balance innovation and affordability. The bill also increases the penalty for knowingly making or distributing counterfeit drugs.
For medical devices, base fee amounts are set at $293,000 for premarket applications and $4,375 for establishment registration in FY2018, with gradual increases to reach $329,000 and $4,978, respectively, by FY2022. Total revenue generated by fees is slated to be $183.3 million in FY2018, $190.7 million in FY2019, $200.1 million in FY2020, $211.7 million in FY2021 and $213.7 million in FY2022. The bill:
- Adds the term “de novo classification” to allow user fees to be collected for reviews of de novo medical device classification requests;
- Calls for a pilot program to be established by 2020 for the FDA to accredit test labs that assess devices for conformity to FDA-recognized consensus standards;
- Requires that draft guidance be issued outlining how determinations are made on whether a class I or II device is eligible for third-party review;
- Stipulates that the FDA issue a report outlining how it plans to ensure the quality, safety and continued efficacy of devices that have been serviced;
- Outlines a process through which the agency may classify medical device accessories based on their intended use;
- Mandates that the FDA implement a risk-based inspection schedule for medical device establishments and publish draft guidance within 18 months outlining how it will implement the risk-based process; and
- Calls on the FDA to establish one or more pilot projects within a year to generate reliable and timely data on the safety and effectiveness of approved or cleared devices
Fees for biosimilars are slated to generate total revenue of $45 million in FY2018, an increase from $20 million in FY2017. The bill creates an independent fee structure for biosimilars based on an initial development fee, annual development fee and program fee for sponsors of approved biosimilars, in addition to an application fee.
The bill has been criticized by the White House and President Donald Trump, who called for a $1 billion increase in fees. In a statement, the White House warned that the bill would require a “significant investment” by taxpayers rather than ask more of the pharmaceutical industry. The Senate hasn’t scheduled a vote on its version of the legislation.