Final FDA reform legislation that cleared Congress adds an additional $225 million to industry's user fee tab over five years, but limits penalties that FDA can assess to enforce its new authorities to mandate labeling changes and postmarket studies.

In addition to reauthorizing the prescription drug user fees through fiscal 2012, the drug safety-oriented legislation includes provisions dealing with when and how clinical trial results will be posted for public view, restrictions on conflict of interest waivers for drug advisory committee participants and limitations on the use of citizen petitions to delay generic drug approval.

To meet the Sept. 21 deadline for renewing the user fees and avoiding reduction in force notices to nearly 2,000 FDA employees who are funded by the fees, managers of the legislation bypassed a formal House/Senate conference for reconciling differences in House and Senate bills (H.R. 2900 and S. 1083).

Instead, the product of several months of bipartisan behind-the-scenes negotiations was introduced as H.R. 3580 and adopted by the House on a 405-7 vote, Sept. 19. Despite a "hold" by Sen. Richard Burr, R-N.C., that temporarily delayed action in the Senate, that chamber approved the measure by unanimous consent the following day.

In line with the House version, the legislation pays for new safety initiatives through hefty increases to the user fees negotiated by FDA and industry. The negotiated fees are $396 million per year, plus adjustments for inflation and other factors. The new safety fees total $225 million across all five years, phased in at a rate of $25 million in fiscal 2008 with increases of $10 million per year through FY '12.

If Congress increases appropriations for postmarket safety, the new safety user fees would be reduced, dollar for every dollar appropriated on top of inflation-adjusted current levels.

FDA also is given authority to assess fees in FY '12 to create three months of operating reserves that can be used to pay for new drug reviews during the first three months of FY '13. This gives FDA a funding cushion should Congress once again delay reauthorizing the fees until close to their Sept. 30, 2012 expiration date.

To add "transparency" to future FDA and industry discussions about user fee levels and agency performance goals, H.R. 3580 includes a provision from the House bill that would place on the FDA Web site the minutes from all negotiations with representatives from industry and patient and consumer advocacy groups (¹ Also see "PDUFA Negotiations Would Add Patient, Consumer Reps Under House Bill" - Pink Sheet, 18 June, 2007., p. 9).

Penalty Cap Lowered To $10 Million

Industry concerns about the level of civil monetary penalties allowed by the House bill have been somewhat alleviated by H.R. 3580 (² Also see "PhRMA’s Compromise Offer On Drug Safety Would “Clarify” FDA’s Powers" - Pink Sheet, 18 June, 2007., p. 7). The $50 million ceiling on penalties for continuing violations adjudicated in a single proceeding has been dropped to $10 million, and the provision allowing fines of as much as $1 million per day was dropped.

H.R. 3580 permits fines of no more than $250,000 per violation, not to exceed $1 million for all violations adjudicated in a single proceeding. If a violation continues after written notice to the responsible party, the same amounts can be charged for the first 30 days, doubling for every 30-day period thereafter, subject to the $10 million cap.

In response to complaints that patients continued to be exposed to Vioxx while FDA and Merck spent 18 months negotiating new warning language in the label, H.R. 3580 not only gives FDA authority to require label changes, but sets timelines for negotiations.

If a company is informed that new safety information must be included in a drug's labeling, the firm has 30 days in which to submit a change or contest the requirement. If FDA disagrees with the response, it shall begin discussions with the company. These may last for no more than 30 days.

Once the discussions have concluded, FDA can order a labeling change and the company has 15 days in which to submit a supplement containing the change, or five days in which to appeal, through a dispute resolution proceeding.

The process may be accelerated if the labeling change is needed to protect public health. The new mechanism raised concerns among trial lawyers that it would allow drug firms to argue that any state-based liability claims are pre-empted by FDA's labeling powers; the bill now contains language stating that sponsors are still responsible for maintaining their labels (see ³ Also see "Pre-emption Limits Survive In Congress, Must Now Stare Down Supreme Court" - Pink Sheet, 24 September, 2007.).

Provisions in H.R. 3580 concerning FDA authority to require post-approval clinical studies and trials combines language from both the House and Senate bills. The additional research can be required to assess a known serious risk, signals of a serious risk or to identify an unexpected serious risk, on the basis of scientific data, including chemically-related or pharmacologically-related drugs.

Post-approval studies may be required if other reports and active surveillance are insufficient to answer safety questions. Post-approval clinical trials can be mandated only if post-approval studies are insufficient. Timetables are to be established for completing each study or trial. Failure to meet the timetable raises the specter of fines, unless there is good cause, as determined by FDA.

Results Database To Be Phased In

H.R. 3580 expands the existing registry of clinical trials to cover more drugs. It also creates a new trial results database, as envisioned by H.R. 2900, but this would be done in a series of steps and with HHS given the regulatory authority to determine the details.

Initially, as in S. 1082, the clinical trials registry data bank would be linked to results information for trials that are the primary basis of a drug approval or were conducted after approval.

Within a year of the law's enactment, the registry is to include the demographic and baseline characteristics of patient samples and primary and secondary outcomes for clinical trials for approved drugs. This deadline can be extended to 18 months at the discretion of HHS.

Not later than three years after enactment, regulations are to be issued to further expand the database and determine whether trials for unapproved drugs should be included.

H.R. 2900 required the inclusion of summaries written for patients. However, in response to industry concerns, the patient summaries will be required only if NIH determines that they can be written "without being misleading or promotional."

The pharmaceutical industry has objected to the lay summaries on the grounds that patient-friendly language might be considered by FDA to be promotional material.

The requirement for a summary that is technical in nature also will be at the discretion of NIH, based on whether it can be written without being misleading or promotional.

The final bill also calls for the database to include the protocol along with the results, as suggested by FDA Office of Medical Policy Director Robert Temple (⁴ Also see "Trial Registry Bill Should Request Protocol With Results, FDA’s Temple Says" - Pink Sheet, 16 July, 2007., p. 20).

The clinical trial results database is considered "one of the biggest consumer victories in this legislation" by Consumer Union Senior Policy Analyst Bill Vaughan. Making results available will ensure that "researchers, doctors and the volunteers [who participate in trials] know if these drugs are truly helpful or harmful," he said.

Waivers Stay In The Mix

A House provision that would have limited conflict of interest waivers for advisory committees to one per meeting is absent from the final bill.

The legislation now calls for FDA to determine the total number of waivers given during all committee meetings in 2007. This number must be reduced by five percent per year through 2012 to achieve a total 25 percent reduction in the aggregate number of waivers over the next five years.

Waivers must be made public 15 days prior to a meeting.

Changes to the citizen petition provisions for protesting generic drug applications state that FDA may not delay generic drug approval because of a petition, unless necessary to protect public health. A decision on a petition must be made within 180 days of its filing, and a filer must wait 180 days after filing before going to court to challenge a generic approval.

[Editor's note: Detailed coverage of these and other new requirements of the bill - including regulation of direct-to-consumer advertising - will appear in upcoming issues of "The Pink Sheet."]

- Cathy Dombrowski (c.dombrowski@elsevier.com)

FDA Bill Passes; Congress Adds $225 Million To Industry User Fee Burden

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