FDA Slashes Fees for Priority Review Voucher

Posted 12 September 2012 | By Alexander Gaffney, RAC 

The US Food and Drug Administration (FDA) has announced the release of fee rates for using tropical disease priority review vouchers for the upcoming year, slashing fees more than 32% from 2012.

The tropical disease voucher system was established under the FDA Amendment Act of 2007 (FDAAA), which authorized a novel program. Under it, companies that receive approval for a tropical disease treatment are eligible to receive a transferrable voucher that allows the bearer to receive six-month priority review status for any future product. Products undergoing priority review are generally given an approval decision-positive or negative-within six months after the applicant's filing date.

The legislation was enacted to spur development of treatment options for tropical diseases, which FDA notes have been remarkably stagnant over the last half century. "Because these diseases are found primarily in poor and developing countries, existing incentives have been insufficient to encourage development of new and innovative drug therapies," explained FDA in a 2008 guidance document on the subject. FDA said it was taking an interest in the topic given the needs of other countries and the ability of those diseases to affect Americans in an increasingly globalized economy.

Under normal circumstances, FDA only grants priority review status to products which fill a treatment void or would otherwise represent a significant advancement compared to existing treatments. Because these reviews cost more than traditional drug reviews, the cost per application is more. However, under the voucher program, any company willing to pay the additional cost of the review may have its product reviewed by FDA, the agency explained.

Fees Set to Go Down Significantly

In a 12 September Federal Register announcement, the agency said each company ultimately using the voucher will be responsible for paying the agency $3,559,000, which is determined as being the cost necessary for FDA to review each application. The Fiscal Year 2012 fee for the same voucher was $5,280,000-48% higher than the 2013 fee.

FDA said a previous formula was based on the full average cost of a priority review, but that the new formula better takes into account the, "Current and ongoing incremental FDA resource costs for a priority review." Despite the reduced fee, FDA said the resources collected will still allow it to ensure, "A robust priority review voucher program that is consistent with the Agency's public health goal of encouraging the development of new drug and biological products."

Companies may still find the cost of the voucher an extremely attractive proposition, as a product reaching market four months-if not longer-faster can generate tens of millions of dollars in immediate sales for some companies, some of which may be cash-starved after a lengthy development process. However, to date, claims an article in the Public Library of Science, "the voucher has not resulted in demonstrated value for any company."

Though Novartis has used the voucher to accelerate the approval of one of its drugs, a gouty arthritis drug called Ilaris, the drug's application was ultimately denied by FDA after it decided it did not have sufficient data to make an approval decision. As no product has used the process successfully to date, the article continues, the value of the program is "difficult to quantify."

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