[Federal Register Volume 59, Number 236 (Friday, December 9, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-30418]
[[Page Unknown]]
[Federal Register: December 9, 1994]
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
[Docket No. 94N-0434]
Establishment of Prescription Drug User Fee Revenues and Rates
for Fiscal Year 1995
AGENCY: Food and Drug Administration, HHS.
ACTION: Notice.
-----------------------------------------------------------------------
SUMMARY: The Food and Drug Administration (FDA) is announcing that it
is establishing user fee revenues and rates for Fiscal Year (FY) 1995.
The Prescription Drug User Fee Act of 1992 (the PDUFA) authorizes FDA
to collect user fees for certain applications for approval of drug and
biological products, on establishments where the products are made, and
on such marketed products. Fees for applications, establishments, and
products for FY 1993 were established by the PDUFA. Fees for FY 1994
and later years are to be determined by FDA using criteria delineated
in the statute.
FOR FURTHER INFORMATION CONTACT: Michael E. Roosevelt, Office of
Financial Management (HFA-120), Food and Drug Administration, 5600
Fishers Lane, Rockville, MD 20857, 301-443-4872.
SUPPLEMENTARY INFORMATION:
I. Background
The PDUFA (Pub. L. 102-571) establishes three different kinds of
user fees. Fees are assessed on: (1) Certain types of applications and
supplements for approval of drug and biologic products, (2) certain
establishments where such products are made, and (3) certain marketed
products (21 U.S.C. 379h(a)). When certain conditions are met, FDA may
waive or reduce fees (21 U.S.C. 379h(d)). Under the PDUFA, one-third of
the total user fee revenue for each FY must come from each of the three
types of fees.
For FY 1993, the total revenues to be derived from fees and the fee
rates for each of the categories were established in the PDUFA (21
U.S.C. 379h(b)(1)). For FY 1994 through 1997, however, the PDUFA
establishes only target total fee revenues and fees. For these years,
FDA is authorized to increase the total fee revenues and to establish
new fee rates for each of the three categories so that the revised
total fee revenues are realized (21 U.S.C. 379h(c)).
This notice establishes total fee revenues and sets application,
establishment, and product fee rates for FY 1995. These fees are
retroactive to October 1, 1994, and will remain in effect through
September 30, 1995. Invoices for establishment and product fees for FY
1995 will be issued in December 1994, using the new fee schedules.
II. Revenue Increase and Fee Adjustment Process
The PDUFA provides that total fee revenues for each FY, as set out
in the original fee schedule (see 21 U.S.C. 379h(b)(1)), shall be
increased by notice in the Federal Register. The increase must reflect
the greater of: (1) The total percentage increase that occurred during
the preceding FY in the Consumer Price Index (all items; U.S. city
average) (the CPI), or (2) the total percentage pay increase for that
FY for Federal employees, as adjusted for any locality-based payment
applicable to employees stationed in the District of Columbia (see 21
U.S.C. 379h(c)(1)). The PDUFA also provides that within 60 days after
the end of each FY, FDA shall adjust the user fee rates in each of the
three categories of fees (application, establishment, and product) to
achieve the revised total fee revenues. The new individual user fees
must be adjusted in a manner that maintains the proportions established
in the original fee schedules, so that approximately one-third of the
revenues will come from each of three categories: Application fees,
establishment fees, and product fees (21 U.S.C. 379h(c)(2)).
III. Total Fee Revenue Adjustment
For FY 1994, the total percentage increase in the CPI was 2.96
percent, whereas the increase in applicable Federal salaries was 3.22
percent. Thus, for computing the total fee revenues for FY 1995, the
latter percentage applies. The new adjusted total fee revenue is
computed by applying the increase as a percentage (103.22 percent), to
the FY 1995 target fee revenue amount from the PDUFA schedule
($75,000,000). The FY 1995 total adjusted fee revenue amount then
totals $77,415,000.
IV. Fee Calculations for Application, Establishment, and Product
Fees
The PDUFA provides that in making adjustments to the user fee
rates, the one-third proportionality must be maintained among
application, product, and establishment fees. Thus, the amount of
revenues to be obtained from each category are $25,805,000 ($77,415,000
divided by 3).
A. Application Fees
Application fees are assessed on each ``human drug application,''
as defined in the PDUFA (see 21 U.S.C. 379g(1)). Application fees are
levied for: (1) Approval of certain new drug applications submitted
after September 1, 1992, under section 505(b)(1) of the Federal Food,
Drug, and Cosmetic Act (the act) (21 U.S.C. 355(b)(1)); (2) for
approval of an application for certain molecular entities or
indications for use submitted after September 30, 1992, under section
505(b)(2) of the act (21 U.S.C. 355(b)(2)); (3) for initial
certifications or approvals of antibiotic drugs submitted after
September 1, 1992, under section 507 of the act (21 U.S.C. 357); and
(4) for licensure of certain biological products under section 351 of
the Public Health Service Act (42 U.S.C. 262).
Fees are assessed at different rates for qualifying applications
depending on whether the applications require for approval clinical
data on safety and effectiveness (other than bioavailability or
bioequivalence studies) (21 U.S.C. 379h(a)(1)(A) and 379h(b)).
Applications that require clinical data are subject to the full
application fee. Applications that do not require clinical data, and
supplements that require clinical data, are assessed one-half the fee
of applications that require clinical data.
In most cases, a first payment of 50 percent of an application or
supplement fee is due at the time the application or supplement is
submitted (21 U.S.C. 379h(a)(1)(B)(i)). The final payment is due 30
days from the date FDA issues an invoice after issuance of an action
letter for the application, or at the time an application is withdrawn,
unless FDA waives this portion of the fee (21 U.S.C. 379h(a)(1)(B)). If
FDA refuses to file an application or supplement, one-half of the first
payment is refunded to the applicant (21 U.S.C. 379h(a)(1)(D)).
In setting the specific rate for each type of fee, FDA is required
to estimate the numbers of applications, supplements, establishments,
and products that it expects will qualify for fees in FY 1995. FDA
makes this estimate based on the number of products, establishments, or
applications subject to fees in FY 1994.
For FY 1994, FDA received and assessed fees for 78 filed
applications that required clinical data, 16 applications that did not
require clinical data, and 78 supplements that required clinical data,
after excluding applications or supplements for which fees were waived.
Because applications that do not require clinical data and supplements
that require clinical data are assessed only one-half the full fee
(that is, one-half the fee due on an application that requires clinical
data), the equivalent number of these applications subject to the full
fee is determined by summing these categories and dividing by 2. This
amount is then added to the number of applications that require
clinical data to arrive at the equivalent number of applications
subject to full application fees.
In addition, as of September 30, 1994, FDA refused to file, or
there were withdrawn before filing, 11 applications that required
clinical data, and 5 applications that did not require clinical data.
After refunds, each of the former applications paid one-fourth the full
application fee and are counted as one-fourth of an application.
Similarly, after refunds, each of the latter applications paid one-
eighth of the full application fee rate and are counted as one-eighth
of an application.
Using this methodology, the approximate equivalent number of
applications that required clinical data and were assessed fees in FY
1994 was 129, before any further decisions were made on requests for
waivers or reductions. Additional waivers or reductions of FY 1994 fees
are expected to account for approximately five equivalents of
applications that require clinical data. Therefore, FDA estimates that
approximately 124 equivalent applications that require clinical data
will qualify for fees in FY 1995, after allowing for possible waivers
or reductions. Thus, the FY 1995 application fee rate is determined by
dividing the adjusted total fee revenue to be derived from applications
($28,805,000), by the equivalent number of applications projected to
qualify for fees in FY 1995 (124), for a fee of $208,000 per
application that requires clinical data (rounded to the nearest
$1,000). A fee of one-half this amount or $104,000 applies to
applications that do not require clinical data and to supplements that
require clinical data. The following calculations summarize the
determination of FY 1995 application fee rates:
78 applications that require clinical data, +(162)
applications that do not require clinical data, +(782)
supplements that require clinical data, +(124) applications
that require clinical data and which FDA refuses to file or the sponsor
withdraws before filing, +(58) other applications that FDA
refuses to file or the sponsor withdraws before filing, -5 waivers or
reductions=124 (the estimated number of ``full fee'' applications for
FY 1995 based on FY 1994 experience).
$25,805,000 (FY 1995 estimated revenue to be derived from
applications) 124 (the estimated number of applications for FY
1995)=$208,000 per application (rounded to nearest $1,000).
For applications that do not require clinical data and
supplements that require clinical data the rate will be one-half the
full application fee or $104,000.
B. Establishment Fees
The PDUFA FY 1994 establishment fee revenue was based on an
estimate of 200 establishments subject to fees. In FY 1994, 206
establishments qualified for fees, before any decisions on requests for
waivers or reductions were made. FDA estimates that approximately 200
establishments will qualify for fees in FY 1995, after allowing for
possible waivers or reductions. Thus, the number 200 is used in setting
the new establishment fee rate. The fee per establishment is determined
by dividing the adjusted total fee revenue to be derived from
establishments ($25,805,000), by the estimated 200 establishments, for
an establishment fee rate for FY 1995 of $129,000 (rounded to the
nearest $100).
C. Product Fees
The FY 1994 product fee was based on an estimate that 2,000
products would be subject to product fees in FY 1994. For FY 1994,
2,156 products qualified for fees, before any decisions on requests for
waivers or reductions were made. However, FDA estimates that only 2,116
products will qualify for product fees in FY 1995, after allowing for
an estimated 40 waivers or reductions. Accordingly, the FY 1995 product
fee rate is determined by dividing the adjusted total fee revenue to be
derived from product fees ($25,805,000), by the estimated 2,116
products, for a product fee rate for FY 1995 of $12,200 (rounded to the
nearest $100).
V. Adjusted Fee Schedules for FY 1995
The fee rates for FY 1995 are set out in the following table:
------------------------------------------------------------------------
Fee rates
Fee Category for FY
1995
------------------------------------------------------------------------
Applications:
Requiring clinical data $208,000
Not requiring clinical data 104,000
Supplements requiring clinical data 104,000
Establishments 129,000
Products 12,200
------------------------------------------------------------------------
VI. Implementation of Adjusted Fee Schedules
A. Application Fees
Application fees in the adjusted fee schedule for FY 1995 are the
same as the projected 1995 fees in PDUFA. Any applications or
supplements subject to fees under the PDUFA that are submitted in FY
1995 must be accompanied by the appropriate application fee.
B. Establishment and Product Fees
By December 31, 1994, FDA will issue invoices for establishment and
product fees for FY 1995 under the new fee schedules. Payment will be
due by January 31, 1995. FDA will issue invoices in October 1995 for
any products and establishments subject to fees for FY 1995 that
qualify for fees after the December 1994 billing.
Dated: December 5, 1994.
William K. Hubbard,
Interim Deputy Commissioner for Policy.
[FR Doc. 94-30418 Filed 12-6-94; 5:02 pm]
BILLING CODE 4160-01-P
