GPhA Urges Congress to Move Ahead on Generic-Drug and Biosimilar User Fees

On Mar. 29, 2012, the Generic Pharmaceutical Association (GPhA) reiterated its call for Congress to move forward with user-fee proposals for generic drugs and biosimilar products.

“The generic industry has stepped up to do our part to help ensure US drug safety, establish a more level playing field among all participants in the US pharmaceutical supply chain, and significantly reduce the time needed to commercialize a generic drug,” said David Gaugh, GPhA vice-president for regulatory sciences in a GPhA statement. Gaugh

before the Senate Committee on Health, Education, Labor, and Pensions on Mar. 29, 2012, in support of generic-drug and biosimilar user-fee programs. “The [user-fee] programs will help assure that American consumers continue to receive the significant cost savings from generics that, over the past dozen years, have provided more than $1 trillion in savings to the nation’s healthcare system,” he said.

The proposed user-fee programs were developed last year through collaboration among GPhA, FDA, and other stakeholders. Under the Generic Drug User Fee Act (GDUFA), the generic-drug industry agreed to pay $299 million annually in user fees for the next five years, beginning Oct. 1, 2012. This funding is supplemental to what Congress appropriates to FDA each year and will enable FDA’s Office of Generic Drugs to hire additional scientific resources needed to provide timely approval of generic drugs. The new fees also will provide increased funding for generic-drug manufacturer facility inspections, noted GPhA in its statement.

In his testimony, Gaugh noted that, of the $299 million per year that FDA will receive over the five-year GDUFA program, 80% (or approximately $240 million) will come from finished-dose manufacturers, and the remaining 20% will be paid by API manufacturers. Thirty percent of the funding will stem from application fees, and 70% will be derived from fees on manufacturing sites or facility fees.

“Splitting the fees in this manner will provide the FDA with a predictable source of annual income, as the number of facilities manufacturing generic drugs on a yearly basis provides a more consistent figure than the number of generic drug applications submitted,” he said. “Finished dose facilities that manufacture both generic and brand medications will be required to pay both a Prescription Drug User Fee Act facility fee and a GDUFA facility fee.”

GDUFA also calls for performance goals for FDA. As part of these goals, GDUFA calls for the agency to complete, by the end of year five, the review of 90% of all generic-drug applications (i.e., abbreviated new drug applications [ANDAs]) for those ANDAs pending as of Oct. 1, 2012, the proposed starting date for the program. In addition, by the end of the program’s fifth year, GDUFA calls on FDA to review 90% of ANDAs within 10 months after they are submitted. In his testimony, Gaugh said more than 2700 generic-drug applications are awaiting approval from FDA’s Office of Generic Drugs, and the average approval time for an application is approximately 30 months.

GPhA also supports a proposed program that creates a separate review platform for biosimilar sponsors, to be financed annually through $20 million of the funds appropriated to FDA and supplemented by user fees equivalent to those under the Prescription Drug User Fee Act. A portion of the application fee paid during the biosimilar development phase will be used to support earlier resourcing for product reviews. Similar to GDUFA, the program also includes performance goals for FDA, which calls for the agency, by the end of the program’s fifth year, to review 90% of the original biosimilar applications it receives within 10 months of its submission.