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By Marc Kaufman
Washington Post Staff Writer
Thursday, May 23, 2002; Page A01

With little public discussion and limited debate on Capitol Hill, Congress is moving to substantially expand the program through which companies pay large fees to the Food and Drug Administration to review their new drug applications -- making the agency increasingly dependent on the businesses that it regulates.

The expansion, a top priority for makers of drugs and medical devices, was put on a congressional fast track and added to the bioterrorism bill, a popular bipartisan effort that negotiators signed off on early this week and the House overwhelmingly approved yesterday.

The expanded FDA "user fee" bill is speeding toward final approval after receiving unusually little public debate or scrutiny. The program was crafted in private meetings between the industry and the FDA, was never debated or voted on in either chamber before going to the negotiators, and is moving forward before a General Accounting Office review of the current program can be finished and made public.

If passed as proposed, the user fees from pharmaceutical and biotechnology companies would add almost 500 employees to the FDA centers that review proposed new drugs and other substances used to treat patients by 2007 -- bringing the FDA workforce funded by industry to at least 1,530. That would constitute more than 55 percent of the FDA staff involved in reviewing drug applications.

Having drugmakers fund the FDA is viewed as such a success by lawmakers and industry representatives that other health product suppliers are eager to follow, and the makers of medical devices and drugs for animals completed negotiations recently with the FDA to start similar industry-funding programs. Intense efforts to tack those programs onto the bioterrorism bill failed Tuesday, but industry spokesmen said they will continue pressing for quick congressional approval.

The FDA user-fee program is a decade old, and agency leaders say that funds from drugmakers have allowed the agency to review applications more promptly and efficiently, and with the same intense scrutiny as before. The result, they say, is that new drugs get to patients more quickly and more than half of the world's new drugs are launched first in the United States.

But some legislators and public health advocates are concerned that industry funding of the FDA will undermine its independence and credibility with the public. Some also worry that the user fees -- plus the accompanying requirements for the FDA to act on drug applications within set periods of time -- are encouraging the agency to move too quickly when it reviews new drug applications and without enough attention to safety. Nine drugs approved in the past 10 years were later withdrawn because of deadly side effects.

Because of such concerns, Sen. Edward M. Kennedy (D-Mass.) last summer requested a GAO evaluation into "potential unintended consequences" of the current FDA user fees and asked that it be completed before Congress took up the bill to reauthorize and expand the program. That report has not been finished or made public.

Kennedy still strongly supports the user-fee legislation, but some of his colleagues are skeptical. "Our concern is that with so much industry money coming in, the fox may be guarding the henhouse at FDA," said Rep. Bart Stupak (D-Mich.) before the final bill was approved. "There's no doubt in my mind that bigger and bigger [user fees] harm the credibility of the agency."

But those arguments have carried little weight on Capitol Hill, especially since congressional authority for the FDA to pay the drug reviewers currently funded through industry fees expires in September. The agency has said it would have to start sending out layoff notices by mid-summer unless the authority was renewed -- a deadline that encouraged congressional leaders to act quickly and attach it to the popular bioterrorism bill.

Health and Human Services Secretary Tommy G. Thompson said yesterday that the expanded drug user-fee program, as well as the proposed medical device and animal drug user fees, are "vitally important" to his department. "If you look at the scarce resources that all of us have, you have to balance the good with the problems," he said. "And the good is that . . . the public will get drugs faster than if we didn't have the fee situation."

The drug and biotechnology industries pay about $160 million yearly in user fees to the FDA, but that sum would jump to $260 million yearly in 2007 under the proposed expansion. The new money would not only allow the agency to hire more staff but also to upgrade its technology and improve management at FDA headquarters. In return, the FDA would commit to maintaining its speedier pace for new drug reviews and to more quickly move applications for new uses of older drugs. In addition, it would begin pilot programs to further speed review of certain fast-track drugs.

The proposed fees for veterinary medicine and medical devices would be much smaller, but would embed the program throughout the FDA. According to industry sources, private funding of the Center for Veterinary Medicine would reach $10 million within three years under the negotiated agreement, and more than $25 million for the Center for Devices and Radiological Health.

Drugmakers pay three user fees to the FDA -- one when they submit an application for a new drug, one for inspections of their manufacturing plants and another for each approved drug on the market. The funds, which will total $1.2 billion over the next five years, go to staff and supply the two FDA centers that review new drug applications. FDA officials say the industry money does not affect agency decision-making -- that it speeds the review process but makes it no more likely that any single drug application will be approved.

The details of all the user-fee programs have been negotiated in private between the FDA and organizations that represent the industries involved -- the Pharmaceutical Research and Manufacturers of America and Biotechnology Industry Organization for drugs, the Animal Health Industry for veterinary drugs and the Advanced Medical Technology Association for medical devices.

When the first drug user-fee bill was passed in 1992 and when it was reauthorized in 1997, intense debates followed in Congress before the program became law. But with the current expansion, Congress had only one limited hearing (in March in the House) and the animal drug and medical devices user-fee programs were never publicly debated. The final negotiations on medical devices were completed over the past weekend.

"It's an amazing thing that all this is going on behind closed doors, that this bill isn't being discussed in the sunshine at all," said Diana Zuckerman, president of the National Center for Policy Research for Women & Families, a public interest group in Washington. "Patient and consumer groups are really not getting a chance to weigh in properly."

But the expanded drug user-fee bill contains some provisions that patient and consumer groups applaud. It would allow the FDA to use industry funds to pay for expanded safety reviews after drugs come on the market and sets aside up to $20 million in dedicated funds. The bill that passed the conference committee also requires greater public participation in the future in the user-fee negotiations between the FDA and the drug industry.

The decision to add the drug user-fee bill to the bioterrorism legislation was initially announced by conference committee chairman Rep. W.J. "Billy" Tauzin (R-La.). He and other legislators agreed to keep all "controversial" elements out of the user-fee proposal, but that effort hit some roadblocks.

The medical device user-fee legislation was opposed by some smaller manufacturers in the industry, and makers of generic veterinary drugs also fought the fee program for their center. Large trade associations representing both industries believe that the FDA centers that regulate their products are underfunded and that the drug user-fee program has increased that underfunding.