LESTER M. CRAWFORD, D.V.M., Ph.D.
FOOD AND DRUG ADMINISTRATION
SUBCOMMITTEE ON HEALTH
COMMITTEE ON ENERGY AND COMMERCE
UNITED STATES HOUSE OF REPRESENTATIVES
MARCH 6, 2002
RELEASE ONLY UPON DELIVERY
Mr. Chairman and Members of the Subcommittee, I am Lester
M. Crawford, Deputy Commissioner of the Food and Drug
Administration (FDA or the Agency). I am pleased to be
here today to discuss the Agency's success in implementing
the Prescription Drug User Fee Act and to emphasize the
importance of reauthorizing this law in advance of its
September 30, 2002, expiration date.
In 1992, Congress enacted the Prescription Drug User
Fee Act (PDUFA I). This law provided additional resources
to hire more medical and scientific reviewers to conduct
premarket reviews, to hire support personnel and field
investigators to speed up the application review process
for human drug and biological products, and to acquire
and support critical information technology infrastructure.
In 1997, after the success of PDUFA I, Congress reauthorized
the program for an additional five years. With this reauthorization
(PDUFA II), came higher expectations for reviews and additional
goals designed to reduce clinical drug development times.
The President’s budget request for Fiscal Year (FY) 2003
recommends that PDUFA be reauthorized through FY2007,
and we have been engaged in discussions with consumers,
health providers, and industry over the past year to develop
proposals for PDUFA III. These discussions have been very
useful, and we hope to complete the consultation process
in the very near future and forward our PDUFA III recommendations
to the Department of Health and Human Services.
During PDUFA I and PDUFA II, FDA met the highest expectations
for performance while continuing to adhere to rigorous
standards for safety and effectiveness. We now have eight
years of data on our efforts to achieve PDUFA goals, and
the Agency’s record of achievement is impressive. The
Agency faced a total of 73 performance goals during this
period. These goals governed the review of priority and
standard new product applications, resubmitted applications,
and supplements. During this eight-year timeframe, FDA
met or exceeded 71 of 73 PDUFA performance goals.
In addition to the 73 performance goals, procedural and
processing standards were instituted under PDUFA II. A
total of 19 goals governing meetings, clinical holds,
dispute resolution, and special protocols were established
when the law was reauthorized. FDA met or exceeded 15
of 19 procedural and processing goals. If you combine
our performance and procedural accomplishments, the Agency
met or exceeded 86 out of 92 PDUFA goals.
Not only has FDA significantly reduced application review
times under PDUFA, it also has significantly reduced product
approval times, and therefore, the time for new drugs
to reach the market. Review time is the time it takes
FDA to review original or resubmitted new product applications,
efficacy supplements, and manufacturing supplements and
issue an action letter. Approval time is measured from
the date an application was initially submitted to the
date an approval letter is issued. Approval time includes
the period of FDA review, as well as the time a sponsor
may spend responding to deficiencies identified by the
Agency during application review. Because of these deficiencies,
some products require more than one review cycle. While
PDUFA established goals for review times, and faster reviews
tend to produce quicker approvals, the quality and completeness
of an individual application and the public health priority
of the product significantly affect time to approval.
The result of our efforts has been a dramatic reduction
in product approval times. The median approval time for
priority new drug and biologic applications dropped from
13 months in FY1993 to only six months in FY2000. We do
not have complete data for FY2001, but median approval
times are projected to remain at six months.
For standard new drug applications, the median approval
time was 22 months in FY1993. By FY1999, however, median
approval times had declined to 12 months. For a variety
of reasons, such as competing PDUFA goals and priorities
and unanswered questions that must be addressed within
some applications, we may experience a slight increase
in approval time in FY2000 for this category of applications.
The data for FY2000 are only preliminary, however.
THE WORLD LEADER
Drugs are now reviewed in the U.S. as fast or faster
than anywhere in the world, without compromising the very
stringent standards that Americans have come to expect.
Between FY1993 and FY 2001, pharmaceutical firms have
introduced 285 new molecular entities (NMEs) and 73 biologics
into the market, a dramatic increase compared to any other
period of time.
Ten years ago, European pharmaceutical companies were
the industry leaders. With the enactment of PDUFA, however,
U.S. companies have overtaken their European counterparts
and now have a commanding lead in world markets. According
to a July 2001 report in the Financial Times, the
European share of the world pharmaceutical market fell
from 32 to 22 percent over the past ten years while U.S.
market share rose from 31 to 43 percent. During this period,
pharmaceutical R&D investment doubled in the European
Union, while U.S. R&D increased a remarkable five-fold.
This turn-around prompted the Tufts Center for the Study
of Drug Development to describe the U.S. environment for
pharmaceutical innovation since PDUFA as "nothing
short of remarkable." The members of this Subcommittee
deserve a large share of the credit for championing PDUFA
and for making these successes possible.
Your efforts have produced significant benefits for public
health. The public has gained access to 717 new drugs
and biologics under PDUFA, including 174 that represent
significant therapeutic advancements. During the PDUFA
era, FDA reviewers have approved:
- 30 new medicines for cancer;
- 37 new medicines for AIDS;
- 29 medicines to fight infection; and
- 18 medicines for cardiovascular disease.
Every day, the lives of cancer patients are measurably
improved as a result of the greater emphasis on priority
review that we instituted under PDUFA. For example, Herceptin®,
a biological product to treat breast cancer, was approved
by FDA in less than five months. In Europe, the approval
process took 18 months. Because of FDA’s priority review,
10,000 American women with advanced breast cancer had
earlier access to this drug. These patients will gain
an estimated 2,300 additional years of life because of
early access to this important new therapy.
The pharmaceutical industry also enjoys significant R&D
savings as a result of shorter review times. Under PDUFA,
FDA reduced new drug review by 12 months. Each month of
reduced review results in an average saving of $2.5 million,
or $30 million in R&D cost savings over 12 months.
Given that FDA approves an average of 40 NMEs and biologics
per year, the savings to industry represent $1.2 billion
annually. The program represents a bargain in light of
the $133 million that industry paid in user fees in FY2001.
Finally, PDUFA has also brought significant benefits
- Performance goals have helped streamline and harmonize
the management of drug and biological product review.
- The program’s requirement for comprehensive product
reviews and responses has resulted in improvements to
the quality of the application review process.
- Most importantly, the fees have enabled the Agency
to hire additional medical reviewers and other specialists,
and upgrade the technology that is essential for the
success of the program.
FDA GOALS FOR PDUFA III
1. SOUND FINANCIAL FOOTING
While our experience under PDUFA II has generally been
good, a number of significant issues have surfaced that
undermine the program’s financial foundation. In PDUFA
III, we are working to address these issues and ensure
that the Agency has a sound financial footing to conduct
essential review and approval activities.
During the final three years of PDUFA II, the amount
of fees collected has been substantially less than the
cost of performing review activities. FDA has been able
to sustain its review effort only by spending fee revenue
collected in previous years that has been held in reserve—an
arrangement permitted under the Act. In FY2001 and FY2002,
spending from fee revenues will exceed fee income by about
$30 million each year. FDA is reducing operations in FY2002
to adjust to this revenue shortfall. However, unspent
revenues from previous years will be depleted by the end
of this fiscal year and there will be little or no fee
balances available after September 30. Establishing a
fee structure to ensure that income covers the cost of
enhancements to the drug and biologic review process authorized
by PDUFA is an issue that we are working to address in
Another problem is that PDUFA application fees are only
paid on new drug and biologic applications and efficacy
supplements. Yet the review of fee-paying applications
represents only a fraction of FDA’s actual review workload.
There are many activities associated with the process
for the review of human drugs and biological products
that are not covered by PDUFA fees. These activities continue
to grow steadily and demand more resources each year,
while the number of fee-paying applications, and the revenue
they generate, fluctuates considerably. This dynamic was
not taken into account when the fee formula was established.
The uncertainty about fee revenue is further complicated
by the relationship between application fees and the product
and establishment fees that also we collect under PDUFA
II. The law directs that establishment and product fees
rise and fall based upon the number of fee-paying applications,
yet the volume of work associated with these activities
has little or no relationship to the number of applications.
The reality of this situation is inconsistent with the
expectation that product and establishment fees were intended
to be a stable element of PDUFA revenue in order to insure
a consistent and predictable source of fees.
2. RISK MANAGEMENT
While drugs and biological products are under development,
clinical testing is usually limited to small, carefully
selected populations of 5,000 or less. After approval,
however, millions of patients may be exposed to the drug.
When the drug is exposed to a much larger and diverse
population, adverse events not seen during clinical trials
often emerge in the first few years after a new product
is on the market. PDUFA has fostered a dramatic reduction
in product approval times, and the U.S. market is increasingly
the country where drugs are first launched.
There is no evidence that drugs are being withdrawn from
the market for safety reasons at a greater rate during
the PDUFA era than prior to the enactment of this landmark
legislation. In fact, the withdrawal rate for new drugs
approved prior to PDUFA is identical to the rate of withdrawal
for drugs approved since PDUFA was enacted (2.7 percent).
However, the need to institute a more effective program
of risk management for new drugs, and thereby ensure greater
patient safety, is clearly warranted by the intrinsic
limitations of drug development programs (particularly
the size of clinical trials) and the reality that more
drugs are launched for the first time in the U.S. Where
risks can be effectively managed, we avoid the need to
withdraw drugs that are highly beneficial to many patients,
though harmful to some.
As you know, PDUFA II expires on September 30, 2002,
and I want to emphasize again the importance of achieving
a timely reauthorizion of this law. FDA is ready to work
with you to accomplish this.
I have described the status of FDA’s user fee account
– Agency carryover balances will be exhausted by the end
of the current fiscal year. If we are to sustain our record
of accomplishment under PDUFA II, it is critical that
the reauthorization occur without a gap between the expiration
of the old law and the enactment of PDUFA III.
Timely reauthorization is a priority for the pharmaceutical
industry, the American public, and the many talented staff
at FDA that we rely upon to conduct human drug and biologic
reviews. Retaining FDA’s skilled employees is essential
to the success of PDUFA III. Any hesitation or delay in
the reauthorization of this program could trigger sudden
erosion in our work force, particularly among senior reviewers
whose skills are in very high demand. The repercussions
of such a loss would be with us for years to come.
Thank you for your commitment to the mission of FDA,
and to the continued success of PDUFA. I am happy to answer
questions you may have.
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revised: March 7, 2002