FDA Explains How GDUFA II Will Help Small Businesses

Posted 26 January 2017 By Zachary Brennan

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The US Food and Drug Administration (FDA) on Thursday offered more details on how the second iteration of the Generic Drug User Fee Act (GDUFA), which must be approved by Congress and President Donald Trump by the end of September 2017, will improve upon the first.

One of the biggest proposed changes between the two programs is the creation of a new user fee structure, which was also outlined in the performance goals letter released in October.

Gisa Perez, FDA generics branch chief in the division of user fee management and budget formulation, explained how the GDUFA II will help small businesses in three ways:

“1. Under GDUFA I, a facility incurred an annual facility fee if it was referenced in a pending or approved Abbreviated New Drug Application (ANDA). As a result, a facility referenced only in pending submissions would incur an annual GDUFA facility fee even though it had no generic drug revenue stream. Under GDUFA II, a facility will be assessed an annual fee only once it is identified in an approved submission.

2. Under the GDUFA II user fee structure, there will be three tiers for the annual program fee based on the number of approved ANDAs owned by a firm and its affiliates: (1) Large (20 or more approved ANDAs); (2) Medium (between 6 and 19 approved ANDAs); and (3) Small (5 or fewer approved ANDAs). The ‘large’ tier will pay 100% of the annual program fee, while the ‘medium’ and ‘small’ will pay 40% and 10%, respectively. We believe this will be a major relief for small business.

3. Within the Finished Dosage Form (FDF) facility category, GDUFA II has carved out a subcategory for Contract Manufacturing Organizations (CMOs), which are independent facilities contracted by ANDA sponsors to manufacture their generic drugs. Under GDUFA II, CMOs will pay only one-third of the annual fee paid by firms that manufacture ANDA products at facilities which they themselves or their affiliates own.”

For a better understanding of the fee structure, FDA also recently offered a side-by-side breakdown of the changes between the two GDUFAs:

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In addition, FDA will also allow refunds under GDUFA II for withdrawn ANDAs. As Perez explains, “Under GDUFA I, there were no provisions for ANDA withdrawals once submitted to the Agency. Now, under GDUFA II, if you submit an ANDA, and for any reason decide to withdraw the ANDA before it is received for filing by the Office of Generic Drugs – then you’re welcome to withdraw the ANDA and be entitled to a 75% refund.”

As far as whether active pharmaceutical ingredient (API) manufacturers can self-identify and pay as CMOs, Perez clarified that that’s “a question we get a lot,” and “No, unfortunately under GDUFA II, the CMO classification is carved out for the FDF [finished dosage form] manufacturers only. API manufacturers will incur an API fee when referenced in an approved submission.”

FDA Addresses Small Business Concerns in GDUFA II

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Categories: Generic drugs, Government affairs, Regulatory strategy, Regulatory intelligence, Submission and registration, News, US, CDER

Tags: GDUFA II, generic drug user fees, CMO user fees

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