Congress Slated to Reauthorize User Fees, Without FDA ‘Improvements’

As the deadline nears for enacting legislation to renew user fees to fund significant FDA operations, legislative leaders are looking to approve a bare-bones measure as part of a short-term government funding bill. Congress must enact a continuing resolution (CR) by Oct. 1, to prevent a federal government shutdown, and the legislators now have agreed to include a five-year fee reauthorization in that measure. Such a continuing resolution (CR) for fiscal year 2023 is expected to run through Dec. 16, after the upcoming mid-term elections.

A key point of debate is whether to include in the CR package provisions to continue and revise a number of FDA programs also slated to expire next week. These and a number of broader reforms were included in the user fee reauthorization bill that was approved by the House months ago and has been pending in the Senate for weeks. It would make significant changes in FDA programs and operations, including policies for how FDA regulates diagnostics, dietary supplements, and cosmetics.

Also off the table is the proposed Cures 2.0 legislation, which was pulled from the main user fee package due to Republican opposition. That measure supports and revises a range of programs to advance biomedical research, but now its fate is uncertain.

Without reauthorization of new fees for drugs (PDUFA), generic drugs (GDUFA), biosimilars (BsUFA), and medical devices (MDUFA) before the current fee programs expire next week, FDA will lose its authority to collect fees from manufacturers, along with requirements for meeting certain timeframes and for utilizing agreed-on policies for assessing and approving new drugs and medical products.

FDA also would have to lay off thousands of staffers who are supported by fee revenues of potential layoffs, a prospect that has eroded agency morale and undermined efforts to recruit and hire needed employees. The agency has struggled for months to maintain and expand its professional workforce in a very competitive market for skilled biopharma experts, and the agency’s funding uncertainty has worsened the situation.

Medical product user fees generate about $2 billion in agency revenues, about 40% of FDA’s non-tobacco budget. While Congressional leaders on both sides of the aisle support the agency’s programs as important for ensuring the health and safety of Americans, the broader political debate over government funding has erected added hurdles for timely reauthorization of new user fee programs. And some consumer advocates have broadened their criticism of expanded user fee funding of FDA by regulated industry as leading toward bias and undermining agency decision-making. FDA Commissioner Robert Califf has said that the agency has sufficient carryover funds to maintain operations for about five weeks into the new fiscal year that begins Oct. 1, but FDA still will have to notify more than 3,000 staffers of “impending employment actions” without user fee reauthorization by Congress.