FDA should only assess user fees on 505(b)(2) applications that make changes to the Indications & Usage section of labeling, according to a recent backgrounder from the Washington Legal Foundation.

In drafting the Prescription Drug User Fee Act in 1992, Congress "considered the scope of information FDA requires to appear in the I&U section and carefully limited FDA's ability to apply user fees to changes only in that labeling section" for 505(b)(2) applications, authors Robert Dormer and Kurt Karst state.

However, FDA has "broadly interpreted the 505(b)(2) application user fee provision to require user fees far beyond anything that Congress ever intended," the Hyman Phelps & McNamara attorneys argue.

The agency's "interpretation of congressional intent is misplaced and without merit," they contend.

"According to FDA, because Congress used the term 'indication for a use' instead of the term 'Indications & Usage,' and generally referenced [FD&C Act section] 201.57(c) in the legislative history rather than a particular portion of the regulation, substantive changes to any part of the labeling...result in a new 'indication for a use'" and, subsequently, a user fee, the attorneys explain.

"A commonsense interpretation of a new 'indication for a use' means exactly what Congress said it means: any new indication for a drug not previously approved that appears in the I&U section," the authors state.

"The implications of FDA's interpretation of a new 'indication for a use' are that many, if not most, 505(b)(2) applications will be termed 'human drug applications,' and more user fees will be collected."

For example, if a 505(b)(2) included a trial comparing a drug with a previously approved drug, "the description of the results of that study in the labeling would be a new 'indication for a use,' even if the study merely confirmed that the 505(b)(2) drug had comparable efficacy to the listed drug for the already approved indication, and even if a statement to that effect appears only in the 'clinical trials' labeling section."

"Untethered to changes only in the I&U section, FDA feels free to interpret any substantive change as a new 'indication for a use,'" Dormer and Karst state in the backgrounder.

According to WLF, the first written example of FDA's new interpretation appears in a draft guidance on user fee waivers for HIV/AIDS drugs proposed for use in the President's Emergency Plan for AIDS Relief.

That guidance prohibits user fee exemption for abbreviated NDAs and 505(b)(2) applications that are not for a new molecular entity or an indication for a use that has not been previously approved (¹ Also see "Co-Packaged HIV Drug User Fees Likely To Be Waived By AIDS Relief Plan" - Pink Sheet, 25 April, 2005., p. 23).

FDA further supports its interpretation of PDUFA using the argument that Rx-to-OTC switches contain new indications for use, the backgrounder states, and thus require user fees.

According to the authors, FDA has explained that an Rx-to-OTC switch is an exception to the 505(b)(2) exemption from user fees, and that one exception opens the door for others.

"Instead of interpreting Congress' statement that the term 'indication' in [the FD&C Act] 'include[s] an Rx-to-OTC switch' to be an exception to the rule that 'user fees would not be required for any other drugs approved under section 505(b)(2),' FDA interprets the exception as but one example that gives it free right to find others," the attorneys maintain.

"Thus, according to FDA, because in an Rx-to-OTC switch, the indication remains the same, but the 'indication for a use' changes (i.e., Rx to OTC), Congress must have intended for FDA to look beyond the 'Indications and Usage' section."

The authors argue a "switch is, in fact, a change in indication; and the exception cited by Congress is consistent with changes in the I&U section."

Dormer and Karst theorize that FDA has instituted its broader interpretation of "indication" to cover the cost of performance demands that followed PDUFA implementation. "Saddled with these increasing cost burdens, FDA has apparently been forced to find new interpretations in PDUFA to offset those burdens."

FDA said it is currently reviewing the document and has no immediate response.

FDA Collection Of 505(b)(2) User Fees Misguided – WLF Paper

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