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Regulatory Focus™ > News Articles > Politico: FDA, Other Domestic Agencies Unable to Freely Talk about Sequestration

Politico: FDA, Other Domestic Agencies Unable to Freely Talk about Sequestration

Posted 06 February 2013 | By Alexander Gaffney, RAC

If federal agencies, including the US Food and Drug Administration (FDA), seem to be approaching the looming threat of fiscal devastation rather quietly, it's not by accident, reports Politico.

That's because Cabinet-level officials, including Kathleen Sebelius, secretary of the Department of Health and Human Services and FDA Commissioner Margaret Hamburg's boss, have been under a virtual gag order from executive branch officials, said Politico.

Any remarks they make must first be cleared through the Office of Management and Budget (OMB), an executive branch agency that acts as an overseer of the federal bureaucracy-a directive that has reportedly stemmed the flow of a considerable amount of information and prevented many officials from speaking too prominently on the issues that would face their agencies if budget sequestration comes into effect.


Those cuts, first passed as part of the Budget Control Act in late 2011, would automatically cut close to 8% from most domestic federal agencies' budgets on an annualized basis. Though it was supposed to go into effect in early January 2013, congressional legislators have thus far managed to delay its implementation until March. The deadline for action, however, is looming, and many industry analysts say FDA could be hard hit by the cuts and forced to delay approval decisions if it is unable to maintain proper staffing levels.

The cuts will go into effect on 1 March 2013 without any congressional action, and federal agencies are set to start publishing their sequester plans as early as 6 February 2013, reports the Federal Times. Those plans are set to include personnel actions-furloughs, firings, and canceled hiring-as well as any grants that might be curtailed and other savings coming from training, travel, supplies and facilities.

Agencies have been planning in earnest for the cuts since at least 14 January 2013, when OMB's Acting Director Jeffery Zients sent a memo to all heads to agencies directing them to begin preparing for the estimated $85 billion in cuts the federal government will need to make.

Given the number of staff at FDA-nearly 15,000-an 8% cut in resources could potentially be devastating to its ability to review new products and inspect facilities, particularly in light of its new congressionally-mandated authorities under legislation like the Food Safety Modernization Act (FSMA) and the FDA Safety and innovation Act (FDASIA), both of which substantially expanded FDA's duties.

Communication Difficulties

But, as Politico reports, just communicating these cuts has been a challenge for heads of agencies. OMB's "gag rule," as one legislator called it, is apparently intended to reduce confusion in the federal workforce by maintaining consistent and accurate messaging, but also seems intended to prevent political skirmishes from focusing on domestic programs as well. The Department of Defense, they note, has been curiously exempted from these rules and has been lobbying against the cuts frequently and loudly.

So while Hamburg has occasionally-as she did this week-made remarks regarding the sequester's effects at the invitation of some advocacy groups, the agency hasn't been given the same room in which to communicate as some public health advocates would like.

That silence could ultimately pose problems for not just the agency, but the industry it regulates as well. While most defense contractors have been vocally opposed to cuts because it affects their contracting directly, pharmaceutical and medical device companies could face similar, albeit indirect, costs.

A company with a submitted drug application could, for example, face longer review times to get the product approved. Companies will also see portions of their user fees-over $100 million each year by OMB's estimates-subject to the sequester as well, subjecting FDA to even more resource constraints. Companies could also face longer times for pre-approval inspections (PAIs) and an agency that returns to-as a 2007 FDA Science Board report put it-a "firefighting posture."

Regulatory Focus has reached out to FDA for comment and will update this space accordingly.

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