[Federal Register Volume 76, Number 147 (Monday, August 1, 2011)]
[Notices]
[Pages 45831-45838]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-19332]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
[Docket No. FDA-2011-N-0559]
Prescription Drug User Fee Rates for Fiscal Year 2012
AGENCY: Food and Drug Administration, HHS.
ACTION: Notice.
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SUMMARY: The Food and Drug Administration (FDA) is announcing the rates
for prescription drug user fees for fiscal year (FY) 2012. The Federal
Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the
Prescription Drug User Fee Amendments of 2007 (Title 1 of the Food and
Drug Administration Amendments Act of 2007 (FDAAA)) (PDUFA IV),
authorizes FDA to collect user fees for certain applications for
approval of drug and biological products, on establishments where the
products are made, and on such products. Base revenue amounts to be
generated from PDUFA fees were established by PDUFA IV, with provisions
for certain adjustments. Fee revenue amounts for applications,
establishments, and products are to be established each year by FDA so
that one-third of the PDUFA fee revenues FDA collects each year will be
generated from each of these categories. This document establishes fee
rates for FY 2012 for application fees for an application requiring
clinical data ($1,841,500), for an application not requiring clinical
data or a supplement requiring clinical data ($920,750), for
establishment fees ($520,100), and for product fees ($98,970). These
fees are effective on October 1, 2011, and will remain in effect
through September 30, 2012. For applications and supplements that are
submitted on or after October 1, 2011, the new fee schedule must be
used. Invoices for establishment and product fees for FY 2012 will be
issued in August 2011, using the new fee schedule.
FOR FURTHER INFORMATION CONTACT: David Miller, Office of Financial
Management (HFA-100), Food and Drug Administration, 1350 Picard Dr.,
PI50, Rm. 210J, Rockville, MD 20850, 301-796-7103.
SUPPLEMENTARY INFORMATION:
I. Background
Sections 735 and 736 of the FD&C Act (21 U.S.C. 379g and 379h,
respectively), establish three different kinds of user fees. Fees are
assessed on the following: (1) Certain types of applications and
supplements for approval of drug and biological products, (2) certain
establishments where such products are made, and (3) certain products
(section 736(a) of the FD&C Act). When certain conditions are met, FDA
may waive or reduce fees (section 736(d) of the FD&C Act).
For FY 2008 through FY 2012, the base revenue amounts for the total
revenues from all PDUFA fees are established by PDUFA IV. The base
revenue amount for FY 2008 is to be adjusted for workload, and that
adjusted amount becomes the base amount for the remaining 4 FYs. That
adjusted base revenue amount is increased for drug safety enhancements
by $10,000,000 in each of the subsequent 4 FYs, and the increased total
is further adjusted each year for inflation and workload. Fees for
[[Page 45832]]
applications, establishments, and products are to be established each
year by FDA so that revenues from each category will provide one-third
of the total revenue to be collected each year.
This document uses the fee base revenue amount for FY 2008
published in the Federal Register of October 12, 2007 (72 FR 58103)
(the October 2007 notice); adjusts it for the FY 2009, FY 2010, FY
2011, and FY 2012 drug safety increases (see section 736(b)(4) of the
FD&C Act), for inflation, and for workload, for excess collections
through FY 2011, and for a final year adjustment; and then establishes
the application, establishment, and product fees for FY 2012. These
fees are effective on October 1, 2011, and will remain in effect
through September 30, 2012.
II. Fee Revenue Amount for FY 2012
The total fee revenue amount for FY 2012 is $702,172,000, based on
the fee revenue amount specified in the statute, including additional
fee funding for drug safety and adjustments for inflation, changes in
workload, offset for excess collections and the final year adjustment.
The statutory amount and a one-time base adjustment are described in
sections II.A and II.B of this document. The adjustment for inflation
is described in section II.C of this document, and the adjustment for
changes in workload in section II.D of this document. The adjustment
for estimated excess collections through FY 2012 is described in
section III of this document, and the final year adjustment is
described in section IV of this document.
A. FY 2012 Statutory Fee Revenue Amounts Before Adjustments
PDUFA IV specifies that the fee revenue amount before adjustments
for FY 2012 for all fees is $457,783,000 ($392,783,000 specified in
section 736(b)(1) of the FD&C Act plus an additional $65,000,000 for
drug safety in FY 2012 specified in section 736(b)(4)).
B. Base Adjustment to Statutory Fee Revenue Amount
The statute also specifies that $354,893,000 of the base amount is
to be further adjusted for workload increases through FY 2007 (see
section 736(b)(1)(B) of the FD&C Act). The workload adjustment on this
amount is to be made in accordance with the workload adjustment
provisions that were in effect for FY 2007, except that the adjustment
for investigational new drug (IND) workload is based on the number of
INDs with a submission in the previous 12 months rather than on the
number of new commercial INDs submitted in the same 12-month period.
This adjustment was explained in detail in the October 2007 notice.
Increasing the statutorily specified amount of $354,893,000 by the
specified workload adjuster (11.73 percent) results in an increase of
$41,629,000, rounded to the nearest thousand. Adding this amount to the
$457,783,000 statutorily specified amount from section II.A of this
document, results in a total adjusted PDUFA IV base revenue amount of
$499,412,000, before further adjustment for inflation and changes in
workload after FY 2007.
C. Inflation Adjustment to FY 2012 Fee Revenue Amount
PDUFA IV provides that fee revenue amounts for each FY after FY
2008 shall be adjusted for inflation. The adjustment must reflect the
greater of the following amounts: (1) The total percentage change that
occurred in the Consumer Price Index (CPI) (all items; U.S. city
average) during the 12-month period ending June 30 preceding the FY for
which fees are being set; (2) the total percentage pay change for the
previous FY for Federal employees stationed in the Washington, DC
metropolitan area; or (3) the average annual change in cost, per FDA
full time equivalent (FTE), of all personnel compensation and benefits
paid for the first 5 of the previous 6 FYs. PDUFA IV provides for this
annual adjustment to be cumulative and compounded annually after FY
2008 (see section 736(c)(1) of the FD&C Act).
The first factor is the CPI increase for the 12-month period ending
in June 2011. The CPI for June 2011 was 225.722 and the CPI for June
2010 was 217.965. (These CPI figures are available on the Bureau of
Labor Statistics (BLS) Web site at http://data.bls.gov/cgi-bin/surveymost?bls by checking the first box under ``Price Indexes'' and
then clicking ``Retrieve Data'' at the bottom of the page. FDA has
verified the Web site address, but FDA is not responsible for any
subsequent changes to the Web site after this document publishes in the
Federal Register.) The CPI for June 2011 is 3.559 percent higher than
the CPI for the previous 12-month period.
The second factor is the increase in pay for the previous FY (FY
2011 in this case) for Federal employees stationed in the Washington,
DC metropolitan area. This figure is published by the Office of
Personnel Management (OPM), and found on their Web site at http://www.opm.gov/oca/11tables/html/dcb.asp above the salary table. (FDA has
verified the Web site address, but FDA is not responsible for any
subsequent changes to the Web site after this document publishes in the
Federal Register.) For FY 2011 it was 0.00 percent.
The third factor is the average change in FDA cost for compensation
and benefits per FTE over the previous 5 of the most recent 6 FYs (FY
2006 through FY 2010). The data on total compensation paid and numbers
of FTE paid, from which the average cost per FTE can be derived, are
published in FDA's Justification of Estimates for Appropriations
Committees. Table 1 of this document summarizes that actual cost and
FTE use data for the specified FYs, and provides the percent change
from the previous FY and the average percent change over the most 5
recent FYs, which is 3.72 percent.
Table 1--FDA Personnel Compensation and Benefits (PC&B) Each Year and Percent Change
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Annual average
FY2006 FY2007 FY2008 FY2009 FY2010 increase for
latest 5 years
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Total PC&B.................................. $1,114,704,000 $1,144,369,000 $1,215,627,000 $1,464,445,000 $1,634,108,000 ................
Total FTE................................... 9,698 9,569 9,811 11,413 12,256 ................
PC&B per FTE................................ $114,942 $119,591 $123,905 $128,314 $130,457 ................
Percent Change from Previous Year........... 5.70 4.05 3.61 3.56 1.67 3.72
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The inflation increase for FY 2012 is 3.72 percent. This is the
greater of the CPI change during the 12-month period ending June 30
preceding the FY for which fees are being set (3.559 percent), the
increase in pay for the previous FY (FY 2011 in this case) for Federal
employees stationed in the Washington, DC metropolitan area (0.00
percent), and
[[Page 45833]]
the average annual change in cost, per FDA FTE, of all personnel
compensation and benefits paid for the first 5 of the previous 6 FYs
(3.72 percent). Because the average change in pay per FTE (3.72
percent) is the highest of the three factors, it becomes the inflation
adjustment for total fee revenue for FY 2012.
The inflation adjustment for FY 2009 was 5.64 percent. This is the
greater of the CPI increase during the 12-month period ending June 30
preceding the FY for which fees were being set (June 30, 2008, which
was 5.05 percent), the increase in pay for FY 2008 for Federal
employees stationed in Washington, DC (4.49 percent), or the average
annual change in cost, per FDA FTE, of all personnel compensation and
benefits paid for the first 5 of the previous 6 FYs (5.64 percent).
The inflation adjustment for FY 2010 was 5.54 percent. This is the
greater of the CPI increase during the 12-month period ending June 30
preceding the FY for which fees were being set (June 30, 2009)
(negative 1.43 percent), the increase in pay for FY 2009 for Federal
employees stationed in Washington, DC (4.78 percent), or the average
annual change in cost, per FDA FTE, of all personnel compensation and
benefits paid for the first 5 of the previous 6 FYs (5.54 percent).
The inflation adjustment for FY 2011 was 4.53 percent. This is the
greater of the CPI increase during the 12-month period ending June 30
preceding the FY for which fees were being set (June 30, 2010) (1.053
percent), the increase in pay for FY 2010 for Federal employees
stationed in Washington, DC (2.42 percent), or the average annual
change in cost, per FDA FTE, of all personnel compensation and benefits
paid for the first 5 of the previous 6 FYs (4.53 percent).
PDUFA IV provides for this inflation adjustment to be cumulative
and compounded annually after FY 2008 (see section 736(c)(1) of the
FD&C Act). This factor for FY 2012 (3.72 percent) is compounded by
adding one to it and then multiplying it by one plus the inflation
adjustment factor for FY 2011 (4.53 percent) and by one plus the
inflation adjustment factor for FY 2010 (5.54 percent) and by one plus
the inflation adjustment factor for FY 2009 (5.64 percent). The result
of this multiplication of the inflation factors for the 4 years since
FY 2008 (1.0372 times 1.0453 times 1.0554 times 1.0564 percent) becomes
the inflation adjustment for FY 2012. This inflation adjustment for FY
2012 is 20.88 percent.
Increasing the FY 2012 fee revenue base of $499,412,000, by 20.88
percent yields an inflation-adjusted fee revenue amount for FY 2012 of
$603,689,000, rounded to the nearest thousand dollars, before the
application of the FY 2012 workload adjustment.
D. Workload Adjustment to the FY 2012 Inflation Adjusted Fee Revenue
Amount
PDUFA IV does not allow FDA to adjust the total revenue amount for
workload beginning in FY 2010, unless an independent accounting firm
study is complete (see section 736(c)(2)(C) of the FD&C Act). That
study, conducted by Deloitte Touche, LLP, was completed on March 31,
2009, and is available online at http://www.fda.gov/ForIndustry/UserFees/PrescriptionDrugUserFee/ucm164339.htm. The study found that
the adjustment methodology used by FDA reasonably captures changes in
workload for reviewing human drug applications under PDUFA IV.
Accordingly, FDA continues to use the workload adjustment methodology
prescribed in PDUFA IV.
For each fiscal year beginning in FY 2009, PDUFA IV provides that
fee revenue amounts, after they have been adjusted for inflation, shall
be further adjusted to reflect changes in workload for the process for
the review of human drug applications (see section 736(c)(2) of the
FD&C Act). PDUFA IV continues the Prescription Drug User Fee Amendments
of 2002 (PDUFA III) workload adjustment with modifications, and
provides for a new additional adjustment for changes in review
activity.
FDA calculated the average number of each of the four types of
applications specified in the workload adjustment provision: (1) Human
drug applications, (2) active commercial INDs (applications that have
at least one submission during the previous 12 months), (3) efficacy
supplements, and (4) manufacturing supplements received over the 5-year
period that ended on June 30, 2007 (base years), and the average number
of each of these types of applications over the most recent 5-year
period that ended June 30, 2011.
The calculations are summarized in table 2 of this document. The 5-
year averages for each application category are provided in Column 1
(``5-Year Average Base Years 2002-2007'') and Column 2a (``5-Year
Average 2007-2011'').
PDUFA IV specifies that FDA make additional adjustments for changes
in review activities to human drug applications and active commercial
INDs. These adjustments, specified under PDUFA IV, are summarized in
columns 2b and 2c in table 2 of this document. The number in the new
drug applications/biologics license applications (NDAs/BLAs) line of
column 2b of table 2 of this document is the percent by which the
average workload for meetings, annual reports, and labeling supplements
for NDAs and BLAs has changed from the 5-year period 2002 through 2007,
to the 5-year period 2007 through 2011. Likewise, the number in the
``Active commercial INDs'' line of column 2b of table 2 of this
document is the percent by which the workload for meetings and special
protocol assessments for active commercial INDs has changed from the 5-
year period 2002 through 2007, to the 5-year period 2007 through 2011.
There is no entry in the last two lines of column 2b because the
adjustment for changes in review workload does not apply to the
workload for efficacy supplements and manufacturing supplements.
Column 3 of table 2 of this document reflects the percent change in
workload from column 1 to column 2c. Column 4 of table 2 of this
document shows the weighting factor for each type of application,
estimating how much of the total FDA drug review workload was accounted
for by each type of application in the table during the most recent 5
years. Column 5 of table 2 of this document is the weighted percent
change in each category of workload. This was derived by multiplying
the weighting factor in each line in column 4 by the percent change
from the base years in column 3. At the bottom right of table 2 of this
document is the sum of the values in column 5 that are added,
reflecting an increase in workload of 8.12 percent for FY 2012 when
compared to the base years.
[[Page 45834]]
Table 2--Workload Adjuster Calculation for FY 2012
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Column 3
Column 1 5- Column 2a 5- Column 2b Column 2c Percent Column 5
year average year Adjustment (Column 2a change Column 4 Weighted
Application type base years average for changes increased by (column 1 Weighting percent
2002-2007 2007-2011 in review column 2b) to column factor change
activity 2c)
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NDAs/BLAs................................................ 123.8 130.8 -0.01% 130.8 5.6% 35.3% 1.99%
Active commercial INDs................................... 5,528.2 6520.6 -2.41 6363.2 15.1 42.4 6.40
Efficacy supplements..................................... 163.4 157.4 NA 157.4 -3.7 9.9 -0.36
Manufacturing supplements................................ 2589.2 2606.8 NA 2606.8 0.7 12.4 0.08
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FY 2012 Workload Adjuster............................ ............. ............ ........... ............ ........... ........... 8.12
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The FY 2012 workload adjuster reflected in the calculations in
table 3 of this document is 8.12 percent. Therefore the inflation-
adjusted revenue amount of $603,689,000 from section II.C of this
document will be increased by the FY 2012 workload adjuster of 8.12
percent, resulting in a total adjusted revenue amount in FY 2012 of
$652,709,000, rounded to the nearest thousand dollars.
E. Rent and Rent-Related Adjustment to the FY 2011 Adjusted Fee Revenue
Amount
PDUFA specifies that for FY 2010 and each subsequent FY, the
revenue amount will be decreased if the actual cost paid for rent and
rent-related expenses for preceding FYs are less than estimates made
for such FYs in FY 2006 (see section 736(c)(3) of the FD&C Act). Table
3 of this document shows the estimates of rent and rent-related costs
for FY 2008 through FY 2010 made in 2006 and the actual costs for these
3 FYs, the only FYs for which complete data are available at this time.
Table 3--Comparison of Actual and Estimated Rent and Rent-Related Expenses for the Center for Drug Evaluation and Research (CDER) and the Center for
Biologics Evaluation and Research (CBER)
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Estimates made in 2006 Actual amounts paid
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FY 2008 FY 2009 FY 2010 Total FY 2008 FY 2009 FY 2010 Total
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CDER................................ $46,732,000 $40,415,000 $41,589,000 $128,736,000 $51,619,000 $64,687,250 $58,049,000 $174,355,250
CBER................................ 22,295,000 23,067,000 25,652,000 71,014,000 26,715,000 26,966,750 27,815,000 81,496,750
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Total........................... 69,027,000 63,482,000 67,241,000 199,750,000 78,334,000 91,654,000 85,864,000 255,852,000
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Because FY 2008 through FY 2010 costs for rent and rent-related
items in total ($255,852,000) exceeded the estimates of these costs
made in FY 2006 ($199,750,000), no decrease in the FY 2012 estimated
PDUFA revenues is required under this provision of PDUFA.
III. Offset for Excess Collections Through FY 2011
Under the provisions of PDUFA III, which applies to user fees
collected for FY 2002 through FY 2007, if the amount of fees collected
for a FY exceeds the amount of fees specified in appropriation acts for
that FY, the excess amount shall be credited to FDA's appropriation
account and shall be subtracted from the amount of fees that would
otherwise be authorized to be collected in a subsequent FY (See 21
U.S.C. 379h(g)(4) as amended by PDUFA III). In setting PDUFA fees for
FY 2007 in August of 2006, some offsets were made under these
provisions, but some offsets still need to be made based on final
collection data for that period. Table 4 shows the amount of fees
specified in FDA's annual appropriation for each year from FY 2003
through FY 2007; the amounts FDA has collected for each year; the
amount of offset previously taken; and the cumulative difference. FDA
will take this difference as an offset against FY 2012 fee collections.
Table 4--Offsets Remaining To Be Taken for PDUFA III, FY 2003-2007
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Excess
collections
offset under Remaining
Fees section excess
Fiscal year appropriated Fees collected 736(g)(4) of collections
the FD&C Act to be offset
when 2007 fees
were set
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2003............................................ $222,900,000 $218,302,684 .............. ..............
2004............................................ 249,825,000 258,333,700 $7,230,906 $1,277,794
2005............................................ 284,394,000 287,178,231 .............. 2,784,231
2006............................................ 305,332,000 313,514,278 .............. 8,209,278
2007............................................ 352,200,000 370,934,966 .............. 18,734,966
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Cumulative difference to be offset against .............. .............. .............. 30,974,959
FY 2012 collections........................
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[[Page 45835]]
In addition, under the provisions of PDUFA, as amended by PDUFA IV,
if the sum of the cumulative amount of the fees collected for FY 2008
through 2010, and the amount of fees estimated to be collected under
this section III of the document for FY 2011, exceeds the cumulative
amount appropriated for fees for FYs 2008 through 2011, the excess will
be credited to FDA's appropriation account and subtracted from the
amount of fees that FDA would otherwise be authorized to collect for FY
2012 under the FD&C Act (21 U.S.C. 379h(g)(4) as amended by PDUFA IV).
Table 5 of this document shows the amounts specified in
appropriation acts for each year from FY 2008 through FY 2011, and the
amounts FDA has collected for FYs 2008, 2009, and 2010 as of March 31,
2011, and the amount that FDA estimated it would collect in FY 2011
when it published the notice of FY 2011 fees in the Federal Register on
August 4, 2010 (75 FR 46956). In FY 2011, application fee revenues to
date are less than anticipated when fees were set in August 2010. The
bottom line of table 5 of this document shows the estimated cumulative
difference between fee amounts specified in appropriation acts for FY
2008 through FY 2011 and PDUFA fee amounts collected.
Table 5--Offsets To Be Taken for the PDUFA IV Period, FY 2008-2011 for FY 2008-2010, Fees Collected Through 3/31/
2011; for FY 2011, Estimate as of 3/31/2011
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Fees
Fiscal year appropriated Fees collected Difference
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2008............................................................ $459,412,000 $479,582,086 $20,170,086
2009............................................................ 510,665,000 521,496,042 10,831,042
2010............................................................ 578,162,000 567,877,548 (10,284,452)
2011 estimate................................................... 667,057,000 619,070,000 (47,987,000)
-----------------------------------------------
Cumulative difference....................................... .............. .............. (27,270,324)
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The cumulative fees collected for FYs 2008 through 2011 are
estimated to be more than $27 million less than the cumulative fee
amounts specified in appropriation acts during this same period. Under
section 736(g)(4) of the FD&C Act, an offset is only made if the
cumulative fees collected exceed cumulative fee appropriations for this
period. Accordingly, there will be no offset of fees attributable to
the PDUFA IV period of FYs 2008 through 2012. The only offset will be
for the $30,974,959 for the PDUFA III period. Reducing the inflation
and workload adjusted estimate of total revenue of $652,709,000 by the
PDUFA III offset of $30,975,000 (rounded to the nearest thousand
dollars) results in a revenue estimate of $621,734,000, before the
final year adjustment.
IV. Final Year Adjustment
Under the provisions of PDUFA, as amended, the Secretary of Health
and Human Services may, in addition to the inflation and workload
adjustments, further increase the fees and fee revenues if such an
adjustment is necessary to provide for not more than 3 months of
operating reserves of carryover user fees for the process for the
review of human drug applications for the first 3 months of FY 2013.
The rationale for the amount of this increase shall be contained in the
annual notice establishing fee revenues and fees for FY 2012 (see 21
U.S.C. 379h(c)(4)).
Table 6--Estimated Carryover Balance at the End of FY 2012, After
Deduction of Estimated FY 2011-2012 Operating Costs
------------------------------------------------------------------------
------------------------------------------------------------------------
Total carryover balance end of FY 2010.................. $150,611,598
Used for offset in 2012................................. 30,975,000
Used for additional 53 FTE (FDAAA drug safety), FY 2011- 29,771,000
2012...................................................
Reserve for refunds..................................... 2,500,000
Used for CBER move to White Oak......................... 37,896,000
Used to cover 2011 estimated revenue shortfalls......... 8,382,000
Used to cover 2012 estimated revenue shortfalls......... 8,694,000
Estimated 2012 end of FY carryover balance.............. 32,393,598
------------------------------------------------------------------------
As of September 30, 2010, FDA had cash carryover balances of
$150,611,598. However, of this amount, a total of $30,975,000 will be
used to cover the cost of the reduction in fee revenue that will result
from the offset in fees for excess collections during PDUFA III. A
total of $29,771,000 will be used in FY 2011 and FY 2012 to cover the
cost of additional FTEs allocated in FY 2009 to address increased PDUFA
workload associated with new drug safety provisions under FDAAA. A
total of $2,500,000 is not available to FDA to obligate because it
represents the minimum amount FDA will need to keep in reserve for
refunds that will need to be made. A total of $37,896,000 is expected
to be used for the CBER move to the White Oak campus in FY 2012-2014.
Based on FDA's experience in FY 2010 when about 17 fewer paid full
application fees were received by FDA than expected, causing a revenue
shortfall, FDA is assuming that about 5.5 fewer full applications will
be received in both FY 2011 and FY 2012, resulting in shortfalls of
over $8,382,000 and $8,694,000 each year, respectively, that will have
to be covered from the carryover balances. Thus the amount of carry-
over balance FDA expects to be available for obligation at the end of
FY 2012 is $32,393,598, as shown in the last line of table 6 of this
document.
Table 7--Estimated Fee Revenue Needed To Sustain FY 2012 Operations for
the First 3 Months of FY 2013
------------------------------------------------------------------------
------------------------------------------------------------------------
Estimated total spending from fees in FY 2012........... $652,709,000
Estimated FY 2013 inflation costs at 3.72%.............. 24,280,775
Estimated FY 2013 funds to sustain FY 2012 operations... 676,989,755
Estimated fees needed for 3 months in FY 2013........... 169,247,444
Estimated end-of-FY 2012 carryover balance.............. 32,393,598
Additional revenue needed for 3 months in FY 2013....... 136,854,000
------------------------------------------------------------------------
In FY 2012, FDA expects to spend a total of $652,709,000, as noted
at the end of section III of this document. To sustain current
operations in FY 2012, with an anticipated inflation rate of 3.72
percent, FDA expects to obligate a total of $676,989,775 in FY 2013--or
a total of about $169,247,444 during the first 3 months of FY 2013. The
available
[[Page 45836]]
carryover balance at the beginning of FY 2013 is estimated at
$32,393,598. Thus FDA would need an additional $136,854,000
($169,247,444 minus $32,393,598, rounded to the nearest thousand
dollars) as the final year adjustment to assure sufficient operating
reserves for the first 3 months of FY 2013.
FDA recognizes that adding $136,854,000 to the fee revenue costs in
FY 2012 poses a substantial burden on the regulated industry at a time
when it is undergoing significant financial strain. In light of this,
and in light of the fact that the legislative language authorizing the
final year adjustment allows FDA discretion in whether to make this
adjustment for a full 3 months of operating reserves or for a shorter
period, FDA has decided to balance its own risks with the amount of
burden the final year adjustment will place on the industry. In making
this decision, FDA has decided to assume more risk, making the final
year adjustment to allow for only 2 months of operating reserves
instead of for 3 months of operating reserves. Accordingly FDA will
make the final year adjustment for a lesser amount, as derived in table
8 of this document.
Table 8--Estimated Fee Revenue Needed To Sustain FY 2012 Operations for
the First 2 Months of FY 2013
------------------------------------------------------------------------
------------------------------------------------------------------------
Estimated total spending from fees in FY 2012........ $652,709,000
Estimated FY 2013 inflation costs at 3.72%........... 24,280,775
Estimated 2013 funds to sustain 2012 operations...... 676,989,775
Estimated fees needed for 2 months in FY 2013........ 112,831,629
Estimated 2012 end of FY carryover balance........... 32,393,598
Additional revenue needed for 2 months in 2013....... 80,438,031
------------------------------------------------------------------------
Rounding this amount to the nearest thousand dollars results in a
final year adjustment of $80,438,000. Adding this amount to the total
of $621,743,000, the total after the offset adjustment at the end of
section III of this document, results in a total revenue target of
$702,172,000, rounded to the nearest thousand dollars, for FY 2012.
PDUFA specifies that one-third of the total fee revenue is to be
derived from application fees, one-third from establishment fees, and
one-third from product fees (see section 736(b)(2) of the FD&C Act).
Accordingly, one-third of the total revenue amount (rounded to the
nearest thousand dollars), or a total of $234,057,000 is the total
amount of fee revenue that will be derived from each of these fee
categories: Application Fees, Establishment Fees, and Product Fees.
While the fee revenue amount anticipated in FY 2012 is
$702,172,000, as the previous paragraph shows, FDA assumes that the fee
appropriation for FY 2012 will be 5 percent higher, or $737,281,000,
rounded to the nearest thousand dollars. The PDUFA IV 5-Year Financial
Plan, (which can be found at http://www.fda.gov/ForIndustry/UserFees/PrescriptionDrugUserFee/ucm153456.htm) states in Assumption 14 (Fee
Revenue and Annual Appropriation Amount) that the PDUFA workload
adjuster is a lagging adjustment dampened by averages over five years,
and will not help FDA keep up with workload if there are sudden
increases in the number of applications to be reviewed in the current
fiscal year. Appropriated amounts for PDUFA fee revenue each year are
estimated at 5 percent higher than estimated fee revenues for each
year, to provide FDA with the ability to cope with surges in
application review workload should that occur. If FDA collects less
than the fee estimate at the beginning of the year and less than the
fee appropriation, then collections rather than appropriations set the
upper limit on how much FDA may actually keep and spend. If, however,
FDA collects more than fee estimates at the beginning of the year, due
to a workload surge, a slightly higher fee appropriation will permit
FDA to keep and spend the higher collections in order to respond to a
real surge in review workload that caused the increased collections--an
unexpected increase in the number of applications that FDA must review
in accordance with PDUFA goals. For this reason, in most FY since 1993,
actual appropriations have slightly exceeded PDUFA fee revenue
estimates made each year.
V. Application Fee Calculations
A. Application Fee Revenues and Application Fees
Application fees will be set to generate one-third of the total fee
revenue amount, or $234,057,000, in FY 2012, as calculated previously
in this document.
B. Estimate of the Number of Fee-Paying Applications and the
Establishment of Application Fees
For FY 2008 through FY 2012, FDA will estimate the total number of
fee-paying full application equivalents (FAEs) it expects to receive
the next FY by averaging the number of fee-paying FAEs received in the
5 most recent fiscal years. Using a rolling average of the 5 most
recent fiscal years is the same method that has been applied for the
last 8 years.
In estimating the number of fee-paying FAEs that FDA will receive
in FY 2012, the 5-year rolling average for the most recent 5 years will
be based on actual counts of fee-paying FAEs received for FY 2007
through FY 2011. For FY 2011, FDA is estimating the number of fee-
paying FAEs for the full year based on the actual count for the first 9
months and estimating the number for the final 3 months, as we have
done for the past 8 years.
Table 9 of this document shows, in column 1, the total number of
each type of FAE received in the first 9 months of FY 2011, whether
fees were paid or not. Column 2 shows the number of FAEs for which fees
were waived or exempted during this period, and column 3 shows the
number of fee-paying FAEs received through June 30, 2011. Column 4
estimates the 12-month total fee-paying FAEs for FY 2011 based on the
applications received through June 30, 2011. All of the counts are in
FAEs. A full application requiring clinical data counts as one FAE. An
application not requiring clinical data counts as one-half an FAE, as
does a supplement requiring clinical data. An application that is
withdrawn, or refused for filing, counts as one-fourth of an FAE if the
applicant initially paid a full application fee, or one-eighth of an
FAE if the applicant initially paid one-half of the full application
fee amount.
[[Page 45837]]
Table 9--FY 2011 Full Application Equivalents Received Through June 30, 2011, and Projected Through September
30, 2011
----------------------------------------------------------------------------------------------------------------
Column 2
Column 1 Fees Column 3 Column 4
Total exempted or Total fee 12-Month
received waived paying fee paying
through 6/ through 6/ through 6/ projection
30/2011 30/2011 30/2011
----------------------------------------------------------------------------------------------------------------
Applications requiring clinical data........................ 55 18 37 49.33
Applications not requiring clinical data.................... 9.5 5.5 4 5.33
Supplements requiring clinical data......................... 44.5 9 35.5 47.88
Withdrawn or refused to file................................ 1.625 1.25 .375 .5
---------------------------------------------------
Total................................................... 110.625 33.75 76.875 102.5
----------------------------------------------------------------------------------------------------------------
In the first 9 months of FY 2011, FDA received 110.625 FAEs, of
which 76.875 were fee-paying. Based on data from the last 10 FYs, on
average, 25 percent of the applications submitted each year come in the
final 3 months. Dividing 76.875 by 3 and multiplying by 4 extrapolates
the amount to the full 12 months of the FY and projects the number of
fee-paying FAEs in FY 2011 at 102.5.
As table 10 of this document shows, the average number of fee-
paying FAEs received annually in the most recent 5-year period, and
including our estimate for FY 2011, is 127.1 FAEs. FDA will set fees
for FY 2011 based on this estimate as the number of full application
equivalents that will pay fees.
Table 10--Fee-Paying FAE 5-Year Average
----------------------------------------------------------------------------------------------------------------
2011 5-Year
Fiscal year 2007 2008 2009 2010 estimate average
----------------------------------------------------------------------------------------------------------------
Fee-Paying FAEs............. 134.4 140.0 140.3 118.4 102.5 127.1
----------------------------------------------------------------------------------------------------------------
The FY 2012 application fee is estimated by dividing the average
number of full applications that paid fees over the latest 5 years,
127.1, into the fee revenue amount to be derived from application fees
in FY 2012, $234,057,000. The result, rounded to the nearest $100, is a
fee of $1,841,500 per full application requiring clinical data, and
$920,750 per application not requiring clinical data or per supplement
requiring clinical data.
VI. Fee Calculations for Establishment and Product Fees
A. Establishment Fees
At the beginning of FY 2011, the establishment fee was based on an
estimate that 415 establishments would be subject to, and would pay,
fees. By the end of FY 2011, FDA estimates that 475 establishments will
have been billed for establishment fees, before all decisions on
requests for waivers or reductions are made. FDA estimates that a total
of 10 establishment fee waivers or reductions will be made for FY 2011.
In addition, FDA estimates that another 15 full establishment fees will
be exempted this year based on the orphan drug exemption in FDAAA (see
section 736(k) of the FD&C Act). Subtracting 25 establishments (10
waivers, plus the estimated 15 establishments under the orphan
exemption) from 450 leaves a net of 415 fee-paying establishments. FDA
will use 450 for its FY 2012 estimate of establishments paying fees,
after taking waivers and reductions into account. The fee per
establishment is determined by dividing the adjusted total fee revenue
to be derived from establishments ($234,057,000) by the estimated 450
establishments, for an establishment fee rate for FY 2012 of $520,100
(rounded to the nearest $100).
B. Product Fees
At the beginning of FY 2011, the product fee was based on an
estimate that 2,385 products would be subject to and would pay product
fees. By the end of FY 2011, FDA estimates that 2,450 products will
have been billed for product fees, before all decisions on requests for
waivers, reductions, or exemptions are made. FDA assumes that there
will be 55 waivers and reductions granted. In addition, FDA estimates
that another 30 product fees will be exempted this year based on the
orphan drug exemption in FDAAA (see section 736(k) of the FD&C Act).
FDA estimates that 2,365 products will qualify for product fees in FY
2011, after allowing for waivers and reductions, including the orphan
drug products eligible under the FDAAA exemption, and will use this
number for its FY 2012 estimate. The FY 2012 product fee rate is
determined by dividing the adjusted total fee revenue to be derived
from product fees ($234,057,000) by the estimated 2,365 products for a
FY 2012 product fee of $98,970 (rounded to the nearest $10).
VII. Fee Schedule for FY 2012
The fee rates for FY 2012 are set out in table 11 of this document.
Table 11--Fee Schedule for FY 2012
------------------------------------------------------------------------
Fee rates for
Fee category FY 2012
------------------------------------------------------------------------
Applications............................................ ..............
Requiring clinical data............................. $1,841,500
Not requiring clinical data......................... 920,750
Supplements requiring clinical data................. 920,750
Establishments.......................................... 520,100
Products................................................ 98,970
------------------------------------------------------------------------
IX. Fee Payment Options and Procedures
A. Application Fees
The appropriate application fee established in the new fee schedule
must be paid for any application or supplement subject to fees under
PDUFA that is received after September 30, 2011. Payment must be made
in U.S. currency by check, bank draft, or U.S. postal money order
payable to the order of the Food and Drug Administration. Please
include the user fee
[[Page 45838]]
identification (ID) number on your check, bank draft, or postal money
order. Your payment can be mailed to: Food and Drug Administration,
P.O. Box 979107, St. Louis, MO 63197-9000.
If checks are to be sent by a courier that requests a street
address, the courier can deliver the checks to: U.S. Bank, Attention:
Government Lockbox 979107, 1005 Convention Plaza, St. Louis, MO 63101.
(Note: This U.S. Bank address is for courier delivery only.)
Please make sure that the FDA post office box number (P.O. Box
979107) is written on the check, bank draft, or postal money order.
Wire transfer payment may also be used. Please reference your
unique user fee ID number when completing your transfer. The
originating financial institution may charge a wire transfer fee
between $15.00 and $35.00. Please ask your financial institution about
the fee and include it with your payment to ensure that your fee is
fully paid. The account information is as follows: New York Federal
Reserve Bank, U.S. Dept of Treasury, TREAS NYC, 33 Liberty St., New
York, NY 10045, Acct. No.: 75060099, Routing No.: 021030004, SWIFT:
FRNYUS33, Beneficiary: FDA, 1350 Piccard Dr., Rockville, MD, 20850.
Application fees can also be paid online with an electronic check
(ACH). FDA has partnered with the U.S. Department of the Treasury to
utilize Pay.gov, a Web-based payment application, for online electronic
payment. The Pay.gov feature is available on the FDA Web site after the
user fee ID number is generated.
The tax identification number of the Food and Drug Administration
is 53-0196965.
B. Establishment and Product Fees
FDA will issue invoices for establishment and product fees for FY
2012 under the new fee schedule in August 2011. Payment will be due on
October 1, 2011. FDA will issue invoices in November 2012 for any
products and establishments subject to fees for FY 2012 that qualify
for fee assessments after the August 2011 billing.
Dated: July 26, 2011.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2011-19332 Filed 7-29-11; 8:45 am]
BILLING CODE 4160-01-P